Yuba City settles overtime lawsuit
Yuba City will pay $20,000 in attorney’s fees as part of a settlement reached in a lawsuit claiming the city violated the Fair Labor Standards Act.
City employees Todd Wolfe, a police officer, and fire department personnel David Jans, Robert Stoddard, Ajinder Gill and Warren Dickerson were plaintiffs, claiming the city “failed to include monetary compensation paid to (employees) who declined (city-provided) health insurance in the ‘regular rate’ used to calculate their overtime compensation,” according to the suit.
David Mastagni, one of the attorneys representing the employees, said the lawsuit was never an adversarial matter.
“The city worked very well with us,” Mastagni said in a phone interview Friday. “We got a very quick resolution, (and) I think everyone was happy with it. It was resolved in a mutually satisfactory way.”
The federal lawsuit, filed last July, stems fom last year’s decision from the 9th U.S. Circuit Court of Appeals involving San Gabriel, requiring that other cities change the way they issue “cash-in-lieu benefits” to employees.
Economic Growth and Public Affairs Official Darin Gale said prior to the San Gabriel case, the city was not including cash-in-lieu benefits into employees’ true hourly rates – instead, the 25-cents-on-thedollar cash-in-lieu payments were issued as a separate line item included in employee paychecks.
In a statement, Gale said it “was proactive in administering the results of the San Gabriel case and communicated as such to our employees. An outcome of the San Gabriel case was a number of cities, including Yuba City, was sued or negatively contacted by attorney or employee groups.”
Yuba City said it was in the process of auditing and compensating employees in compliance with the San Gabriel case when the lawsuit was received. The city was in the process of compensating the employees in compliance with San Gabriel and the lawsuit caused additional costs to the city, it was reported.
The suit alleged Yuba City “implemented an illegal compensation computation method, which undercuts (employees’) ‘regular rate’ of pay. (The city’s) method of calculating (employees’) ‘regular rate’ of pay results, and has resulted, in underpayment for overtime hours worked.”
The settlement agreement noted the city calculated and paid overtime compensation arising out of cash-in-lieu benefits to all eligible employees dating back to July 1, 2013.
The city also paid liquidated damages and calculated the back wages, based on the inclusion of the cash-in-lieu benefits and taking into account all overtime hours worked, according to the settlement. Those payments were issued to employees last November.
Included in the settlement agreement is the city’s modification of its calculation of the regular rate of pay to include amounts paid as cash-in-lieu benefits going forward.