Labor & Employment Law Daily $31.5M would settle misclassification, OT claims of T.J. Maxx, Marshalls, HomeGoods assistant managers
News
Monday, July 27, 2020

$31.5M would settle misclassification, OT claims of T.J. Maxx, Marshalls, HomeGoods assistant managers

By Pamela Wolf, J.D.

The $31,500,000 maximum gross settlement amount is the second largest wage and hour settlement in the First Circuit in terms of total dollars.

In a wage and hour class and collective action litigated for more than six years, parent TJX Companies and its T.J. Maxx, Marshalls, and HomeGoods business would pay $31.5 million to about 1,911 former and current assistant store managers, according to a proposed settlement agreement. The deal would settle allegations that the plaintiffs were misclassified as exempt and were not paid overtime wages for hours worked over 40.

Earlier settlement. Previously, in September 2016, part of the consolidated class action—for management training misclassification and unpaid overtime—was settled for $4.75 million, delivering more than $165 per week of training to those class members. At that time the court was concerned about the low turnout of claimants, which significantly reduced the total distribution to the class by operation of a reversion provision, but it nevertheless approved an attorneys’ fee award that exceeded the total distribution to the class. The court warned that it would give greater weight to the percentage of claims made by class members in the future.

Hard-fought litigation. Fast forward to the July 20, 2020, plaintiffs’ unopposed motion for preliminary settlement. After ongoing discovery disputes, two mediation sessions, extensive negotiations, and the intervention of the mediator to help resolve particular disputes, the parties finally came to an agreement, the plaintiffs said. Before reaching agreement, and throughout the extensive litigation of the case, the plaintiffs’ counsel “thoroughly investigated the claims brought in this action,” the memorandum in support of the proposed settlement states.

About the numbers. The $31,500,000 maximum gross settlement amount is the second largest wage and hour settlement in the First Circuit in terms of total dollars, according to the plaintiffs. The settlement includes the FLSA claims of the 1,172 opt-in plaintiffs and the claims of the members of the putative New York state law settlement class, estimated at 900 individuals, for a total (given overlap) of about 1,911 current and former assistant store managers.

The average gross recovery amount for each of the FLSA opt-in plaintiffs and New York State law settlement class members would be about $16,750 ($10,207 after awards for administration, attorneys’ fees and costs, and service payments). From the gross settlement fund would be subtracted class counsel’s attorneys’ fees and costs and disbursements of up to 33 and 1/3 percent ($10.49 million); service payments to class representatives and the FLSA opt-in plaintiffs who appeared for deposition (totaling $108,000); the defendants’ share of payroll taxes; the mediation expenses; and the expenses of the claims administrator (about $60,000). There would also be a reserve fund of about $500,000 to cover errors or omissions.

The consolidated case, Roberts v. The TJX Companies, Inc., is pending in the District of Massachusetts; it is No. 1:13-CV-13142.

Interested in submitting an article?

Submit your information to us today!

Learn More

Labor & Employment Law Daily: Breaking legal news at your fingertips

Sign up today for your free trial to this daily reporting service created by attorneys, for attorneys. Stay up to date on labor and employment legal matters with same-day coverage of breaking news, court decisions, legislation, and regulatory activity with easy access through email or mobile app.