Schuck Law’s attorneys prevailed at the Court of Appeals for the Ninth Circuit in arguing that employers can’t use a reducing “bonus” to avoid paying their workers overtime wages This employer’s pay structure subtracted overtime wages from bonuses. The result was a payment plan that essentially paid the employee at the same rate no matter how many hours the employee worked, using the smaller bonus to offset the employees’ overtime earnings. The Court of Appeals found this was an unlawful payment practice that avoids payment of overtime wages. The Court rejected the employer’s arguments that it could avoid paying overtime as long as the employees’ total weekly pay exceeded minimum wage and agreed with Schuck Law that the employer still had to calculate and pay overtime at one-and-a-half times the regular rate. This case reinforces that employers must strictly follow the law when determining overtime pay, and that lump-sum or flat-rate pay systems do not excuse failure to pay overtime correctly.
DECISION(S):
Brunozzi v. Cable Comm. Inc., 851 F3d 990 (9th Cir. 2017).