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Burlington Stores Reach $11 Million Settlement Over Employee Overtime Pay

department store interior

Burlington Stores has agreed to pay $11 million to settle claims that it failed to properly classify assistant store managers and pay them overtime wages.

As reported by the Pittsburgh Post-Gazette, the settlement brings closure to a series of lawsuits brought by over 3,000 assistant store managers who claimed that they were entitled to overtime pay under federal law for working more than 40 hours a week, and that Burlington failed to provide its stored with sufficient “labor budgets” for hourly employees, resulting in assistant store managers doing the work without overtime pay.

While managers are exempt from being paid overtime, they must meet certain requirements – typically involving the type of work duties they perform or the discretion they can exercise over certain business decisions. According to court documents, Burlington’s assistant store managers performed tasks similar to hourly employees and did not exercise “meaningful independent judgment or discretion” or have the authority to hire or fire employees.

Burlington, which is based in South Jersey, reclassified its assistant store managers as hourly employees eligible for overtime pay in February 2021, and set aside over $30 million to pay what it owed managers who worked overtime while they were misclassified.

Burlington’s latest settlement comes after the South Jersey-based chain formerly known as Burlington Coat Factory settled two other suits brought by assistant store managers for a combined $19.6 million. Other discount retailers, including TJ Maxx and Duane Reade, settled similar cases brought by their assistant store managers, with TJ Maxx paying $31.5 million in 2020 and Duane Reade reaching a $13.5 million settlement in 2017.

Worker Misclassification & Workers’ Rights

Classifying hourly employees as managers, as Burlington is alleged to have done in these cases, is one of several ways companies misclassify workers to cut costs. As we’ve discussed in previous blogs, misclassifying workers as independent contractors rather than employees is another way employers skirt responsibilities to pay their workers lawful wages or the benefits to which they’re entitled.

Unfortunately, worker misclassification – whether its misclassifying workers as non-hourly employees or as independent contractors – is not uncommon. But it is harmful to workers who often lose out on overtime, benefits such as unemployment or workers’ compensation, and other important labor protections.

At Levinson Axelrod, P.A., our attorneys have experience representing workers across the state in matters of workers’ compensation and wage and hour claims involving overtime. If you have questions about your rights and legal options, call (732) 440-3089 or contact us online.