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While reviewing the docket recently of South Florida federal court cases filed in a single day, Robert S. Turk realized that more than a third of the lawsuits were for overtime pay. “Five of the 13 cases in federal court were overtime claims under the Fair Labor Standards Act. There has definitely been an uptick in these cases,” said Turk, a partner in the Miami office of Gunster Yoakley who specializes in labor and employment law. “It has maintained that pace and increased,” he said. “It’s been full steam ahead.” The number of overtime suits filed in the Southern District of Florida has nearly doubled from 2000 to 2002, and collective actions brought by groups of employees under the FLSA have more than tripled, according to a survey by Frank Scruggs, the national co-chair of the employment practice at Greenberg Traurig. According to Scruggs’ numbers, 78 collective actions under the FLSA were filed in 2000 and 261 were filed in 2002. Collective actions are brought by employees who have claims that are considered similarly situated and are different from typical class actions under Rule 23 of Federal Rules of Civil Procedure. In terms of total claims, which included not just collective actions but suits by individuals, there were 341 total overtime claims filed in the Southern District in 2000 and 615 during 2002. “There is an increasing awareness that plaintiffs and lawyers have succeeded in getting multimillion-dollar awards around the country. The statute contains an attorney fee provision and provision for the doubling of damages when violations are proven intentional, and that has served to increase the awareness of claims,” said Scruggs, a former Florida secretary of labor. Observers speculate South Florida is a hotbed for this type of litigation because of the bad economy combined with the large immigrant work force and the high number of small businesses that either don’t know or consciously fail to comply with the law. “It is a function of two, distinct factors,” said Donald J. Jaret, a solo practitioner in Miami who has represented plaintiffs in wage and hour cases for 20 years. “One, there are more violations here because of the nature of the work force and its employers. Two, attorneys have become more aware and are interested in handling these types of cases.” But critics blame the wave of lawsuits under FLSA on an overzealous plaintiffs’ bar seeking to make as much money as it can by filing as many suits as it can. They cite a stipulation in the act that requires the losing party to pay attorney fees. In other words, in a dispute over $600 in overtime pay, the losing company could still also be liable for $15,000 in attorney fees. “Lawyers have caught on that this is an easy way to make big money,” said Mark R. Cheskin, a partner at Morgan Lewis in Miami. “As an employer, the more you fight the more you rack up fees because the clock is ticking.” In fact, Jaret himself ended up on the receiving end of a scathing order by a Miami federal judge who accused him of seeking to drive up attorney fees in a local overtime case. The plaintiff was an employee of Killian Oaks House of Learning, a private school in Miami-Dade. According to court papers, the worker, who had been terminated, filed a claim for overtime. But in a ruling released this week, U.S. District Judge Federico A. Moreno chastised Jaret, who sought $16,000 in attorney fees in a case for $315.89 in wages as “shaking down” the defendants by trying to conduct “nightmarishly expensive litigation solely in pursuit of attorneys fees.” The judge added: “Every action of plaintiff’s counsel, it seems, was calculated to avoid prompt out-of-court resolution that would have kept the costs of litigation down to any reasonable amount. Indeed, he has the temerity to cloak a case of this frivolous nature in the laudable and salutary policy objectives that the FLSA was enacted to combat.” Jaret said he would appeal the ruling. “Although I do not discuss pending matters such as this, it is something that in my opinion needs to be corrected and I will do everything in my power to correct it,” he said Monday. While he declined to discuss the case specifically, he said that in general the onus for resolving FLSA cases should rest with defendants. Miami attorney Peter Homer of Homer, Bonner & Delgado represented the school pro bono. The FLSA, the Depression-era federal law enacted more than 60 years ago that created the 40-hour work week and governs overtime pay, has become the statute of choice by plaintiffs’ attorneys to sue employers. Last year, the U.S. Department of Labor announced that, for the first time, there were more lawsuits for overtime pay under the FLSA than claims alleging job discrimination. “There has been a rediscovery of the statute,” said Caryl L. Boies, a partner in the Hollywood, Fla., office of Boies, Schiller & Flexner. The claims have resulted in some eye-catching payouts. Last year, Starbucks agreed to settle claims of $18 million for unpaid overtime to store managers and assistant managers. But Jaret insists many employers are simply failing to comply with the law. In particular, that South Florida’s large immigrant population and abundance of small businesses creates an environment ripe for the complexities of wage and hour law to be misunderstood or simply ignored. “There are a lot of small employers here who are not educated in the U.S. or are not sophisticated business people and they don’t know, or don’t care, about this area of law,” Jaret said. But equally important, he added, is that attorneys are now looking to bring overtime claims. “Ten to 15 years ago, I was pretty much the only guy doing wage and hour law,” Jaret said. “Recently, a lot of attorneys are dabbling in it. Some are doing it well and some are messing it up.” Greg Shavitz, partner of three-attorney Shavitz Law Firm in Boca Raton, Fla., who predominantly does wage and hour work, added that the spate of claims has much to do with a down economy and both attorneys and employees becoming more aware of the law. “A client may inquire about an unrelated employment matter like wrongful termination or disability — and there are more of them in a bad economy. But, when interviewing the client, attorneys are now asking if they received time and a half for overtime work,” Shavitz said. “That’s why many attorneys who don’t practice in the field are identifying claims. Also, employees who have brought these claims are telling their friends. We keep finding that clients of ours have been referred by past clients.” Enacted in 1938, the FLSA established minimum wage, overtime pay, record-keeping and child labor standards for full- and part-time workers in the private sector and government. The basic premise of the overtime provision is that anyone who works more than 40 hours a week is entitled to a time-and-a-half rate of pay. But within that there are a litany of exceptions that exempt employers from paying overtime. It is the exceptions, according to attorneys, that are often ignored or misunderstood. “Perhaps the biggest pitfall for employers is the misclassification of employees into one of the numerous categories that exempt employers from having to pay overtime,” Mark J. Neuberger, the managing partner of Buchanan Ingersoll in Miami, recently wrote in a column published in The National Law Journal. Generally, the exemptions are for executive, professional and administrative employees, but figuring out who falls under what description can be difficult because the government’s descriptions of various job duties have not changed in decades. Jaret said he sees many instances where an employer incorrectly concludes that because an employer slaps the title “assistant manager” on an employee or pays an employee a salary rather than hourly wages, the employee is not due overtime pay. Critics and some attorneys agree that changes are needed. “The law needs to be revised. There is just too much gray area in the wording of the law where an employer can be an innocent violator,” Turk said. Tammy McCutchen, the administrator of the U.S. Labor Department wage and hour division, has said that she intends to propose revisions of the classifications. But plaintiffs’ attorneys say that removing attorney fees from the federal statute is not the cure. They contend that if attorney fees were not built into the statute many workers — including those most easily taken advantage of — would not be able to file a claim. For example, a worker earning minimum wage in a restaurant could not hire a lawyer and bring a claim. They also asserted that while the law could use some clarification, there is no reason why employers cannot understand and fully comply with the law as it is currently written. Meanwhile, the cases keep coming. “I don’t think these cases are at their peak. I still think there are a huge number of potential cases and claims,” Jaret said. “I still don’t see a huge awareness on behalf of employees to comply with this law.”

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