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News | Oct 13, 2014

WINEBRAKE & SANTILLO OBTAINS IMPORTANT VICTORY ON BEHALF PENNSYLVANIA RETAIL WORKERS WHO ARE PAID “HALF-TIME” FOR OVERTIME WORK.

On July 10, 2014, the United States District Court for the Eastern District of Pennsylvania issued an important decision in Verderame v. RadioShack Corporation, 2:13-cv-2539-MSG, a case brought by our firm and our friends at the Minneapolis, MN firm of Nichols Kaster PLLP.

The store managers in Verderame were paid overtime under the federal “fluctuating workweek method” in which overtime-eligible employees are paid a salary plus overtime compensation equal to “one-half” the employee’s regular hourly rate.  In certain circumstances, this method of overtime compensation is permissible under the federal overtime law.

The Verderame lawsuit alleged that RadioShack’s use of the fluctuating workweek method violated Pennsylvania’s overtime law, which often is found to be more worker-friendly than federal law.  RadioShack sought dismissal of the lawsuit, alleging that the fluctuating workweek method is permissible under Pennsylvania law.

United States District Judge Mitchell S. Goldberg’s 12-page opinion rejected RadioShack’s argument.  The Judge concluded that, while the fluctuating workweek method of compensation “may be lawful under the baseline federal regulation, the same cannot be said as it applies to the more employee-friendly Pennsylvania regulation.”  Thus, the Court held that “RadioShack violated the [Pennsylvania Minimum Wage Act] by not compensating Plaintiff for overtime at ‘1 ½ times’ the basic rate as set forth in their compensation plan” and granted the plaintiff’s motion for summary judgment.”

To date, our firm has recovered millions of dollars for Pennsylvania employees paid under the fluctuating workweek method of overtime compensation.  Most of these employees hold “manager,” “assistant manager,” and “co-manager” positions at retail chains.

If any of your Pennsylvania clients have worked in retail and been paid overtime under the half-time method, we would be very happy to speak with them.

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