Settlement reached in Moore, et al. v. IKEA California
March 2, 2007
Daily Journal Verdicts & Settlements
SETTLEMENT: $5 million.
CASE/NUMBER: Moore, et al. v. IKEA California, et al., BC263646/BC269402
COURT/DATE: L.A. Superior Central/Dec. 11, 2006
ATTORNEYS: Plaintiff - John N. Quisenberry, Robert J. Drexler, Jr., Susan E. Abitanta (The Quisenberry Law Firm, Los Angeles).
Defendant - Frank M. Liberatore, Scott C. Lacunza (Jackson Lewis, LLP, Newport Beach).
FACTS: Approximately 500 current and former employees who worked as store department managers ans assistant department managers and assistant department managers in California (Managers) at IKEA stores across California between Dec. 14, 1997, and Oct. 16, 2005, charged that IKEA improperly classified its Managers as exempt to avoid paying overtime.
Under California law, employers are required to pay overtime to all employees, unless the employer can show that an exemption applies.
PLAINTIFF'S CONTENTIONS: Class members were improperly classified as exempt from receiving overtime pay.
DEFENDANT'S CONTENTIONS: IKEA contended that its Managers fell under the executive exemption because they spent more than half their working hours managing the business and performing managerial tasks.
RESULT: Approximately 500 current ans former IKEA employees who worked as store department managers in California (Managers) at IKEA stores across California between Dec. 14, 1997, and Oct. 16, 2005 will share in a $5 million settlement for compensation of unpaid wages. This settlement was approved on Dec 11, 2006, by court Judge Peter J. Lichtman.
OTHER INFORMATION: Although defendants made no admission of wrongdoing, the parties were able to come to a settlement viewed as fair by both sides. Under the settlement agreement, Assistant Managers are entitled to receive for each week worked $83.10 and Managers are entitled to receive $53.69.
A greater percentage of the settlement amount was allocated tot he Assistant Managers because they accounted for 56 percent of the employment work weeks, and because they arguably had a stronger case on the misclassification issue. Any residual money will be distributed to class members, and none of the settlement monies will revert to IKEA.
No one objected to the settlement, and the class notice received a very high response rate, i.e., approximately 73 percent of the Assistant Managers and 79 percent of the Managers submitted valid claims.
Since the inception of this case, IKEA has reclassified certain Assistant Managers in its California stores as non-exempt employees entitled to overtime compensation.
