Category: FLSA

The Top 3 Mistakes Employers Make That Lead to Employment Lawsuits

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Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You Prevent Employment Lawsuits

As a small business owner, you are likely juggling many responsibilities. One of the most important aspects of running a successful business is managing your employees effectively and within the boundaries of the law. Unfortunately, many small business owners unknowingly make mistakes that can lead to costly employment lawsuits.

Mishandling Employee Classification

One of the most common mistakes employers make is improperly classifying their employees, which can lead to wage and hour laws violations. There are two primary classifications: exempt and non-exempt employees. Exempt employees are not eligible for overtime pay, while non-exempt employees must be paid overtime for any hours worked over 40 in a workweek.

Misclassifying employees can lead to significant financial penalties for employers. If an employee is incorrectly classified as exempt, they may be entitled to overtime pay for all hours worked over 40 in a workweek. This can result in substantial back pay, fines, and penalties for the employer.

To avoid misclassification, it is essential to familiarize yourself with the criteria for exempt and non-exempt employees under the Fair Labor Standards Act (FLSA). The FLSA provides specific tests to determine if an employee qualifies as exempt based on salary, job duties, and responsibilities. If you are unsure about an employee’s classification, consult with legal counsel to ensure compliance with the law.

Additionally, regularly review and update your employee classifications as job duties and responsibilities change. Ensuring proper classification from the outset and consistently monitoring it can help prevent costly litigation.

Failing to Comply With Anti-Discrimination Laws

Employment discrimination lawsuits are another common legal issue for small businesses. Employers must comply with various anti-discrimination laws, such as Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act (ADA), and the Age Discrimination in Employment Act (ADEA).

Failing to comply with these laws can lead to costly and time-consuming litigation. Discrimination claims can result in substantial damages, including back pay, compensatory damages, and punitive damages. Moreover, defending against these claims can severely damage a company’s reputation and employee morale.

It is essential to create and enforce a clear anti-discrimination policy to prevent discrimination claims. This policy should outline the company’s commitment to equal opportunity and prohibit discrimination based on race, color, religion, sex, national origin, age, disability, or other protected characteristics.

Additionally, provide regular training on anti-discrimination laws and your company’s policies to all employees, including managers and supervisors. This will help ensure everyone understands their rights and responsibilities under the law.

Finally, promptly investigate and address any complaints of discrimination. Taking appropriate action when a complaint arises can help prevent escalation and potential litigation.

Ignoring Employee Complaints

Employee complaints, whether about harassment, discrimination, or workplace safety, should never be ignored. Failing to address these concerns can lead to legal liability and a hostile work environment.

Ignoring employee complaints can result in a hostile work environment, which may lead to lawsuits alleging harassment or discrimination. Additionally, failing to address workplace safety concerns can result in violations of the Occupational Safety and Health Administration (OSHA) regulations, leading to fines and penalties.

Establish a straightforward process for employees to report complaints and concerns. This process should include multiple avenues for reporting, such as a designated HR representative or an anonymous hotline.

Take all complaints seriously and conduct a thorough investigation. If the investigation reveals any wrongdoing, take appropriate action to remedy the situation, such as disciplining the offending party or implementing new workplace policies.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Can Help You Prevent Employment Lawsuits

You cannot stop anyone from suing you, but you can take proactive steps to reduce the likelihood that a lawsuit against your company will be successful. To create a plan for your business, speak with our Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. about your options. Call us at 215-574-0600 or contact us online to schedule an initial consultation. Located in Philadelphia, we proudly serve clients in Pennsylvania and New Jersey.

Should I be Paid for My Summer Internship?

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Internships are almost always a win-win. Employers get needed help and potential future hires, while the intern gets valuable work experience that looks great on a resume. It may not be common knowledge that legal guidelines stipulate whether an internship must be paid or unpaid, but there are. Therefore, anyone considering an internship should know if their position qualifies for a paycheck.

After years of study of internships, the U.S. Department of Labor realized that many employers take advantage of interns by not paying them. While interns often volunteer to work for free, they should not do this if they legally should be paid. According to guidelines under the federal Fair Labor Standards Act (FLSA):

  • Interns in a qualifying paid position must earn at least the federal minimum wage for internships in the for-profit or private sector.
  • They also must be paid overtime.

What Criteria Do Interns Have to Meet to be Paid?

The FLSA specifies criteria to determine whether the intern is a trainee who does not need to be paid or an employee that must be paid at least the federal minimum wage:

  • Intern does not replace regular employees but works under close supervision of existing staff.
  • Employer and intern both clearly understand there is no expectation of compensation during or at the end of the internship.
  • Internship is similar to training that would be given in an educational environment despite occurring in the employer’s facility.
  • Internship accommodates the intern’s schedule and commitments, such as school attendance.
  • Internship benefits the intern and their formal education; it ties in coursework or provides academic credit.
  • Internship is limited to the actual time the intern is provided beneficial learning.

If the internship meets all the criteria above, the FLSA does not consider it to be an employment relationship. Employers are then exempt from paying the minimum wage and overtime. While the criteria are open to interpretation, employers who do not want to pay their interns must provide skills and opportunities that truly benefit them.

Moral and Ethical Considerations

While the law provides legal guidelines regarding payment for internships, there are moral and ethical considerations too. Many studies show that paid interns are loyal and happy interns. They are often more enthusiastic, often hoping to be hired. Interns will also feel valuable if they are earning a paycheck and be more willing to contribute. Additionally, paying is good for the employer as well; they can set the intern’s schedule and the number of work hours.

Ethical considerations come into play as well. Employers must consider the intern’s responsibilities. Are they getting an authentic educational experience with a valuable mentor-mentee relationship, or are they making copies and getting coffee? If the intern’s work contributes in any way to the company’s successful operations, they should be paid.

An employer who expects an intern to work many hours for free or does not give them a valuable educational experience should not hire the intern to begin with. Interns should not be considered free labor. Instead, they should be regarded as contributing members of a work team that deserve to be paid for their time and effort.

The FLSA guidelines regarding internships are not easily enforced, and some employers are not even aware of them. Many interns are willing to work for free. However, when they do, the employer has the moral responsibility to give them a significant learning and skill-building experience that will benefit them in their future careers.

Philadelphia Employment Lawyers at Sidkoff, Pincus & Green P.C. Protect Interns’ Rights to Fair Pay

Interns and employees have rights under the law. Wage and hour issues are common among those who contact the Philadelphia employment lawyers at Sidkoff, Pincus & Green P.C. We have helped numerous employees get fair and just treatment in the workplace. For an initial consultation about your case, contact us online or call us at 215-574-0600. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

Department of Labor Conducts Investigation, Finds Many Employers in Violation of FLSA

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Philadelphia employment lawyers advocate for clients who's employer is violating FLSA.The Department of Labor recently conducted multiple investigations throughout the country, identifying multiple violators of various aspects of the Fair Labor Standards Act (FLSA). The FLSA sets guidelines as to who is protected, and dictates that certain employees must receive 1.5x their hourly rate for any weekly hours worked in excess of 40. The Department of Labor penalized various employers who improperly compensated their employees for mistakes such as incorrectly rounding an hourly wage rate, or playing flat daily rates.

One of the investigations ordered Lowndes Advocacy Resource Center Inc. (LARC) of Georgia to pay $157,473 back to 130 of its employees, because it did not meet the requirements of Section 14(c) of the Fair Labor Standards Act, which allows employers, after obtaining a certificate, to pay a minimum wage less than the Federal minimum to disabled employees. LARC incorrectly rounded the employees’ wage rates, deducted their break time from their daily hours, and did not count travel time as work time, resulting in their gross underpayment.

Similarly, ASAP Courier & Logistics LLC, was ordered to pay 160 of its employees $64,027 in back wages based on underpayment of its delivery drivers. The Florida based company paid its drivers flat daily rates without regard to how many hours they worked, severely reducing the amount of overtime that they should have been paid. Paying flat daily rates is not illegal; however, any hours worked in excess of 40 must be compensated by 1.5x the employee’s hourly rate. Similar to ASAP, Chattanooga Restaurant Group LLC had to pay its employees $153,740 for failing to accurately track their hours, significantly reducing the amount of overtime to which the employees were entitled.

For more information, call our Philadelphia employment lawyers for Fair Labor Standards Act in Philadelphia and South Jersey at the Law Office of Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

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Department of Labor Proposes Update to the Fair Labor Standards Act’s Overtime Rates

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Philadelphia overtime lawyers are knowledgeable in all aspects of overtime and the FLSA.In March 2019, the U.S. Department of Labor (DOL) suggested an update to the FLSA’s definition of “regular pay” in order to make it easier for employees to calculate employee overtime premiums. This proposal is supported by the Society for Human Resource Management (SHRM) because the changes will provide more clarity in the overtime calculation process, therefore making it easier for employers to offer benefits to their employees without fear of violating any standards.

Currently, the “regular rate” of pay is not clearly defined, and in order to avoid violation of the FLSA standards, employers are not offering certain benefits such as public transportation subsidies, tuition reimbursement, and more. The proposal by the DOL to clarify the meaning of “regular pay” should hopefully decrease uncertainty and encourage employers to offer such benefits without fear of a lawsuit.

As of now, overtime rate must be paid once employees work over 40 hours and that it must be at least 1 ½ times their regular rate. However, overtime rates also must include all payments for employment unless it falls under one of the statutory exceptions. For example, in addition to hourly wages and salaries, the regular rate also includes most bonuses, on-call pay, commissions and more. The DOL’s proposed amendment to the FLSA would clarify that the following benefits are excluded from the regular rate calculation: tuition reimbursement, employer-provided gyms, reimbursed expenses, and more.

Hopefully, once the proposed changes come into effect, employers will offer more benefits to their employees. The proposed changes should, at the very least, create clarity in the FLSA so employees are compensated fairly for their overtime work.

For more information, call our Philadelphia overtime lawyers at the Law Office of Sidkoff, Pincus & Green P.C. at 215-574-0600 or submit an online inquiry.

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GNC Employees Sue Over Alleged PA Minimum Wage Act Violations

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Philadelphia overtime claims lawyers secure fair overtime pay for workers.Chevalier v. General Nutrition Centers (GNC) was a class action lawsuit filed on behalf of a group of GNC employees who argued that they should be paid time-and-a-half for any hours worked over 40, rather than merely their regular rate plus half. According to the plaintiffs, the company used unfair methods to calculate the employee’s regular rate in violation of the Pennsylvania Minimum Wage Act (PMWA).

The case addresses two main issues. First, the plaintiffs believed that the trial court should have calculated the employees’ regular rate by diving their weekly salary by 40 hours, rather than by the total hours they actually worked. However, the section of the PMWA that applies to this case authorizes the secretary of the Department of Labor and Industry to declare which regulations could define the term.

Second, the plaintiffs argued that the proper overtime pay should be time-and-a-half, according to Pennsylvania law. The court decided that there is no such thing as half-time overtime, and the PMWA requires employers to pay no less than 1-½ times the employee’s regular pay rate for hours worked in excess of 40 hours in a given workweek.

The attorney representing GNC told the court that the method GNC used to calculate overtime was fair and that it met the requirements of the Fair Labor Standards Act (FLSA) and the PMWA. He also discussed the fact that the Department of Labor and Industry did not offer an opinion about whether the practice was appropriate. He argued that the Department of Labor and Industry adopted language from the FLSA, which demonstrated their intent to calculate employees’ overtime pay based on FLSA standards.

Justice Christine Donohoe questioned that assertion due to the absence of any clear language from state regulators. She went on the say that it is not the Court’s position to try to understand the intent of an agency. Rather, the purpose of the Court is to interpret the statute.

Philadelphia Overtime Claims Lawyers at Sidkoff, Pincus & Green, P.C. Secure Fair Overtime Pay for Workers

If you have not received the overtime pay you deserve, you are urged to contact the Philadelphia overtime claims lawyers at Sidkoff, Pincus & Green, P.C. We will examine the details of your case and ensure that you receive the full overtime pay to which you are entitled. To schedule a confidential consultation, call us today at 215-547-0600 or contact us online. Our offices are located in Philadelphia, where we represent clients in employment law matters across southeastern Pennsylvania and New Jersey.

Class Action Claim Filed Against Hotel Chain for Unpaid Overtime

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Philadelphia employment lawyers represent workers with unpaid overtime claims.In the case of Diflavis v. Choice Hotels International, the plaintiff claimed that she did not receive the overtime pay that she deserved, which violated the Fair Labor Standards Act (FLSA) and the Pennsylvania Minimum Wage Act. On behalf of herself, and other employees who made similar claims, the plaintiff filed a class action and collective action claim against the hotel chain. The defendant argued that the Complaint against them should be dismissed because the plaintiff failed to adequately demonstrate that Choice Hotels was a joint employer in the case. In addition, they requested that the collective and class action claims be stricken from the complaint. The Court denied both requests.

From early June 2018 to late August 2018, the plaintiff worked as a full-time housekeeper for Clarion Hotel & Conference Center, making an hourly rate of $9.00. All Clarion Hotel housekeepers are assigned 16 rooms to service, which includes making the beds, providing clean towels, vacuuming, and general cleaning. For any rooms serviced beyond the 16 that were assigned, the housekeeper earns $5.00 per room. While housekeepers are scheduled to work five, eight and a half-hour shifts each week, they are expected to continue working until all 16 rooms have been serviced.

Overtime Violations

In order to service all 16 rooms, housekeepers often worked up to 12 hours per day without taking a break for meals. The plaintiff claimed that she worked an average of 50 to 55 hours per week, but she was only paid for 36 hours per week. She alleged that she was not paid the overtime rate of $13.50 per hour for the number of hours she worked that exceeded 40 hours. In addition, she alleged that the defendants were aware of the violations, and that they calculated housekeepers’ pay based on the number of work hours and rooms serviced that supervisors entered into payroll, rather than the actual number of hours worked and rooms serviced. The plaintiff also argued that Choice Hotels and Rama Construction Company are joint employers in the case.

The defendant argued that the joint employer allegations were flawed because the plaintiff did not satisfy the test for a joint employer, and she failed to specify whether her primary employer was Rama or Choice Hotels. However, the court ruled in favor of the plaintiff, saying that Choice Hotels did not meet the standard required to strike the plaintiff’s collective and class action claims.

Philadelphia Employment Lawyers at Sidkoff, Pincus & Green, P.C. Represent Workers with Unpaid Overtime Claims

If you have not received overtime pay for working more than 40 hours in a given week, you are urged to contact the Philadelphia employment lawyers at Sidkoff, Pincus & Green, P.C. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. Our offices are conveniently located in Center City Philadelphia, where we serve clients from Southeastern Pennsylvania and New Jersey.

Employee Loses Prima Facie Case of Retaliation But May Continue His Defamation Case Against Former Employer

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On March 20, 2018, Plaintiff Haabiyl Mims filed a Complaint alleging retaliatory discharge under the Fair Labor Standards Act of 1938 (FLSA § 15 (a)(3)), Defamation and Defamation Per Se, and Wrongful Termination by Defendants New Age Protection Inc. and Tamisha Thorogood Haabiyl Mims v. New Age Protection, Inc., Civ. Action No. 18-CV-1185, 2018 WL 5829340 (E.D. Pa. 2018). After 5 years working at his former employer, Defendant New Age Protection, Inc., a security corporation, Mims was terminated in March 2017. The given reason was that it appeared as if Mims falsified his timesheet to get paid for time he did not work. This termination was made 8 months after Mims received thousands of dollars in back taxes when New Age was investigated by the Department of Labor. Mims then brought suit, alleging retaliation by his former company.

The Court reviewed the Fair Labor Standards Act (FLSA) to see if Mim’s termination was lawful. In Pennsylvania, courts looks at three necessary elements to establish a prima facie case of retaliation under the FLSA, “(1) the plaintiff engaged in protected activity, (2) the employer took an adverse employment action against him, and (3) there was a causal link between the plaintiff’s protected action and the employer’s adverse action.” Scholly v. JMK Plastering, Inc., No. 07–4998, 2008 WL 2579729, at *3 (E.D. Pa. June 25, 2008) (citing Preobrazhenskaya v. Mercy Hall Infirmary, 2003 WL 21877711 (3d Cir. 2003) (citation omitted)). Mims insisted that his former manager and employer knew of his participation in the DOL investigation and fired him because of it. The Court looked at the Mims’ Complaint and saw that he had no proof that his company or manager knew he took part in the investigation. The Court pointed out that even if his employer knew the eight month gap is too far between to establish a clear connection timewise. The Court also focused on the two promotions that Mims received during his time at the company so they concluded there was no animosity at all. Thus, the Court found that Mims termination did not violate the FLSA.

The Court then moved onto Mims’ allegation of defamation. In Pennsylvania, a A plaintiff must establish: (1) The defamatory character of the communication. (2) Its publication by the defendant. (3) Its application to the plaintiff. (4) The understanding by the recipient of its defamatory meaning. (5) The understanding by the recipient of it as intended to be applied to the plaintiff. A statement is defamatory “if it tends so to harm the reputation of another as to lower him in the estimation of the community or to deter third persons from association or dealing with him.”

The Court looked at one of the emails that seemed to impute that Mims engaged in criminal and/or improper conduct punishable by either imprisonment or judicial sanction to all employees of the company. The company tried to defend itself by asserting that the email was sent out to only certain privileged people at the company who needed to know that Mims was terminated and why. The Court ruled that the issue was too contentious to decide without further evidence and allowed Mims to amend his Complaint regarding the defamation claim.

At the Law Office of Sidkoff, Pincus & Green, our Pennsylvania and New Jersey attorneys are knowledgeable in all matters related to employment discrimination. To schedule a consultation with a Philadelphia employment lawyer, call 215-574-0600 today or contact us online.

Eastern District Court Dismisses FLSA Claim Based on Statute of Limitations

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In Everett v. The Maternal Child Consortium, LLC, the Eastern District of Pennsylvania dismissed claims arising from a violation of the Fair Labor Standards Act (“FLSA”) which did not fall within the two-year statute of limitations. Civil Action No. 18-746 (E.D.Pa. 2018). Plaintiff began working for Defendant’s company in September of 2004 as a scheduler. Between 2004 and 2016, Plaintiff alleges that she consistently worked 41.5 hours per week and estimated that on three occasions per week, her meals were interrupted which reduced her meal time to under twenty minutes, the amount of time required by law.

Plaintiff asserted two bases for her FLSA claim. First, she asserted that she was not paid overtime compensation for work performed during her meal breaks. Second, she asserted that she performed “compensable on-call work”. The FLSA establishes federal minimum-wage, maximum-hour, and overtime guarantees that cannot be modified by contract. Under the FLSA, “employers may not employ an employee for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.”

Defendant raised a statute of limitations defense and contended that Plaintiff has to show that Defendant willfully violated the FLSA. Since Plaintiff failed to do so, the Court dismissed all of her claims arising out of a violation of the FLSA which did not fall within the two-year statute of limitations. In addition, the Court found that Plaintiff’s single allegation that she “performed compensable on-call work” was not enough to state a claim because she was required to show “onerous on-call polices and significant interference with plaintiff’s personal life.” For these reasons, the Court dismissed Plaintiff’s second FLSA claim.

For more information, call our Philadelphia employment lawyers for Fair Labor Standards Act in Philadelphia and South Jersey at the Law Office of Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

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Third Circuit Court Affirms Grant of Summary Judgment in PMWA Statutory Construction Case

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In Livi v. Hyatt Hotels Corp., No. 17-3646, 2018 WL 4944823 (3d Cir. 2018) the Third Circuit Court of Appeals affirmed the grant of summary judgment in favor of Hyatt Hotels in a Pennsylvania Minimum Wage Act (“PMWA”) and Pennsylvania Wage Payment and Collection Law (“WPCL”) action. Plaintiff, a banquet server for Hyatt, filed a class action complaint on behalf of herself and similarly situated individuals alleging that she worked more than 40 hours but was not paid overtime and that she was entitled to contractual service charge which Hyatt retained.

Under Pennsylvania law, service establishments (including hotels) are not required to pay overtime to employees working more than 40 hours per week if they are exempt from the overtime requirement under 34 Pa. Code § 231.43(f). An employer may be exempt if the “regular rate of pay of the employee is in excess of 1 ½ times the minimum hourly rate applicable” or “more than half of the employee’s compensation for a representative period, not less than 1 month, represents commissions on goods or services.” Plaintiff fell within both exemptions because the Court found her regular rate of pay at Hyatt was more than 1 ½ times the minimum wage and the service charges Hyatt paid her comprised more than half her compensation.

However, Plaintiff argued that Hyatt was not exempt from the overtime requirement because the service charges do not “represent commissions on goods or services” under the Pa. Code. The Court reasoned that although the relevant Pennsylvania statutes do not define “commission” and the Pennsylvania Supreme Court had no guidance on the issue, it was appropriate for the Court to look to Pennsylvania’s intermediate appellate court for assistance. The Court then explained that Pennsylvania’s Commonwealth Court instructed that “when the PMWA substantially parallels the federal Fair Labor Standards Act (“FLSA”), Pennsylvania courts look to federal courts’ interpretation of the parallel FLSA provision for guidance. Looking then to the FLSA’s overtime exemption, the Court agreed with the District Court that banquet service charges represent commissions. Therefore, the District Court appropriately awarded summary judgment to Hyatt.

If you have been denied overtime wages, the experienced Philadelphia employment lawyers at the Law Office Of Sidkoff, Pincus & Green will fight to get you the compensation you deserve. To schedule a consultation, call us at 215-574-0600 or contact us online today. With offices conveniently located in Philadelphia, we serve clients throughout Southeastern Pennsylvania and South Jersey.

PA District Court Declines to Dismiss PMWA Based on Factual Insufficiency

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In Philadelphia Metal Trades Council v. Konnerud Consulting West, Civil Action No. 15-5621, 2016 WL 1086709 (E.D. Pa. 2016) the Court found that Plaintiff’s Pennsylvania Minimum Wage Act (“PMWA”) claim is not preempted by the Fair Labor Standards Act (“FLSA”) and declined to dismiss Plaintiffs claim. Plaintiff was an unincorporated association consisting of a number of local union chapters. Defendants were subcontractors conducting business and employing workers at Plaintiffs shipyard. Defendants, who are foreign corporations, were required to provide a certified payroll of their employees.

According to Plaintiffs, Defendants paid workers less than one and one half times their regular hourly wage for hours worked in excess of forty. Plaintiffs filed a complaint and alleged that employees worked over forty hours a week and that Defendants failed to pay them overtime wages in violation of the PMWA and the Pennsylvania Wage Payment and Collection Law (“WPCL”).

Defendant moved to dismiss Plaintiffs Complaint based on the fact that Plaintiffs PMWA claim was factually inadequate and preempted by the Fair Labor Standards Act (“FLSA”). As to the first argument, the Court found that Plaintiff’s claim under the PMWA was factually sufficient because Plaintiff plead sufficient facts to give rise to a plausible claim for relief under the PMWA. The Court found that Plaintiffs attachment of payroll audits which supported the allegations that Defendants were violating the PMWA as dispositive. As to the second issue, the Court found that Plaintiffs PMWA claim was not preempted by the FLSA because Plaintiff did not explicitly bring an opt-out class action which Defendants argue would conflict with the FLSA. Even if Plaintiff brought an opt-out PMWA class action as described by Defendant, its claim would still not be preempted by the FLSA.

For more information, call our Philadelphia employment lawyers for Fair Labor Standards Act in Philadelphia and South Jersey at the Law Office of Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

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