The lawsuit was filed by two former employees, Karina Escobedo and Liliam Lopez, on behalf of themselves and all other similarly situated employees.
According to California labor law, overtime must be paid at the rate of one and a half times the regular hourly wage. However, the lawsuit claims that Pacific Western Bank paid employees overtime wages in the form of a “discretionary wage incentive wage based on their performance for the company”.
The lawsuit claims that the bank should calculate overtime based on both the required hourly time and half rate and include the discretionary wage incentive.
The plaintiffs are represented by the national employment law firm of Blumenthal, Nordrehaug & Bhowmik.
Attorney Nicholas De Blouw does not comment on ongoing litigation but notes that California Labor Laws make clear that “generally a non-exempt employee's overtime compensation must be based upon his or her ‘regular rate’ of pay.
"These types of violations can go unnoticed for years..."
“This is not only the employee's stated hourly rate or other straight-time wage,” says De Blouw. “Instead, regular rate includes all ‘remuneration for employment’ that is not otherwise excludable from the regular rate.”
In addition, the state of claim says, the bank failed to provide the plaintiffs and other members of the class with “complete and accurate wage statements” which are required by law. The statements the bank provided, the claim goes on to say, did not show the correct penalty for missed meal or rest periods. California Labor Code Section 226 requires companies to provide employees with itemized wage statements in writing.
The plaintiffs claim that their “rigorous work schedules” often required them to forfeit meal breaks or take meal breaks during which they were not fully relieved of their duties. In addition, the company failed to provide a second meal break on days when employees worked 10 hours or more.
The lawsuit alleges Pacific Western Bank engaged in unfair labor practices, at the expense of the workers, in order to gain an advantage over competitors who complied with the law.
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The class action has yet to be certified.
De Blouw and the Blumenthal, Nordrehaug & Bhowmik firm have handled hundreds of employment law cases. De Blouw says, from his experience, companies that “fail to include non-discretionary incentive compensation into employees’ overtimes rates are engaging in wage theft.
“These types of violations can go unnoticed for years because employees sometimes are only being shorted a few dollars per pay period. Companies know that it is easier to steal a few dollars from a lot of employees than a lot of dollars from a few employees,” he says.