Ohio Overtime Attorney Best Answer: Can my employer avoid paying me overtime by calling me an independent contractor? Can my employer avoid paying me overtime by splitting my hours between different companies? How do I find a lawyer to sue my job for overtime pay violations?
Both Federal and Ohio law require that qualified employees are entitled to overtime wages. As provided by Ohio R.C. § 4111.03(A) “[a]n employer shall pay an employee for overtime at a wage rate of one and one-half times the employee’s wage rate for hours worked in excess of forty hours in one workweek, in the manner and methods provided in and subject to the exemptions of . . . the Fair Labor Standards Act of 1938, 52 Stat. 1060, 29 U.S.C.A. 207, 213, as amended.”
As incorporated in Ohio R.C. § 4111.03(A), the Fair Labor Standards Act (“FLSA“) establishes what kind of employees should be paid overtime wages. Essentially, the law starts with the presumption that every employee should be paid overtime and makes exceptions for those employees that don’t. These exceptions are called exempt employees.
Those who read our wage and hour attorneys‘ blogs may recall that we blogged about the various tricks employers use to avoid paying employees overtime. (Can I Sue My Boss Individually For Not Paying Me For Overtime? I Need A Wage Lawyer!; If I Do Domestic Work, Can I Sue For Overtime Pay? I Need A Lawyer!; Are IT Employees Entitled To Be Paid Overtime At Time And A Half?; Should I Be Paid Overtime Even If I Have The Title Manger? Top Ohio Wage and Hour Lawyer Reply; What Is The Minimum Salary To Be Exempt From Overtime Pay Requirements? I Need A Lawyer!)
The recent case of Perez v. Oak Grove Cinemas, Inc., demonstrates that employers are not only still using these tricks to commit wage theft against its employees, but coming up with new ones as well.
In Perez, the plaintiffs were employed by Oak Grove Cinemas (“OGC”) to do construction, maintenance, and landscaping to various properties owned by OGC’s president, David Emami, and his wife, Diane Emami, to include their personal residence. However – and this is where the new trick comes in – the Emamis would have the employees punch two time cards for two different companies during the day, in order to make it appear that no overtime had been worked. Employees would punch in during the morning for one company, OGC, and then punch out around lunch time. These employees would then punch back in after lunch for another company owned by the Emamis, and continue their workday until they punched out on the second time card. The task and jobs the employees were performing were the exact same between the companies, for the same rate of pay, and most of the employees testified that they just thought they were employed by the Emamis, and had not paid attention to the actual entity they were employed by. These employees would generally receive two checks, one from each company. One employee testified that when he asked David Emami why he was receiving two checks, he was expressly told it was because the Emamis did not want to pay overtime.
Eventually, the Department of Labor (“DOL“)was notified of these practices, and decided to file suit on behalf of employees. The case proceeded to bench trial before United States District Court for the District of Oregon Judge Marco A. Hernandez. As a defense, the Emami’s attempted to use another overtime trick to avoid liability by claiming the employees were actually independent contractors. But the Court wasn’t having any of it:
David Emami hired the workers. He determined their rate of pay. He often told them where to work on any particular day and frequented the various locations where the workers performed an array of tasks as he determined. He controlled the manner in which the work was to be performed. He frequently told them to hurry up. His supervisory employee or subcontractor also directed the workers, but those individuals were employed by David Emami.
The workers had no opportunity for “profit or loss” depending on their managerial skill. David Emami testified that the workers generally were all performing primitive construction work and were unskilled. While the workers had some investment in their own small tools, they did not provide any of the landscaping equipment or more specialized or heavy equipment used at various projects. The workers did not employ helpers. Although the jobs performed by the OGC employees were not an integral part of the movie theater business, the evidence showed that in addition to running a movie theater, OGC supplied the labor for the Emamis’ other businesses. The trial testimony of all the witnesses established that running the movie theater is not the primary purpose of the Emamis’ collective property-related businesses. Given that all three businesses shared all of the workers, it is clear that the workers’ landscaping and construction work was an integral part of the Emamis’ property-related business interests. Moreover, as noted above, none of the employees worked for a non-Emami entity during the time they worked for the Emamis. They did not have other clients. They did not own their own companies. Additionally, the workers were paid by the hour, not by the job, often punching a time clock.
The only evidence suggesting that the employees were independent contractors is the non-credible testimony of the Emamis. All relevant facts show that the “economic reality” of the relationship between the workers and the Emamis is that the workers were entirely dependent on the Emamis and their businesses. Finally, while only six employees testified, Defendants presented no evidence suggesting that they treated the remaining twenty-nine employees any differently than the six who appeared at trial. It is reasonable to conclude that all the Exhibit A individuals were employees for all of the hours they worked for the Emamis and any of the three Defendant companies.
Next, the Emamis attempted to argue that (1) each business entity the employees worked under was too small to be covered under the FLSA and (2) that the employees were working under truly separate businesses. The Court saw through this as well, finding that OGC and the other businesses owned by the Emami’s were part of a single enterprise:
Although part of OGC’s business was running the movie theater, the testimony established that it simultaneously had the purpose of providing labor for the maintenance and construction of other properties owned or managed by one of the two Barrington companies. Thus, the three companies are “related” and engage in “related activities” by sharing the OGC labor pool for the work required at all of the Emami properties. Second, the three companies were under the common control of the Emamis who together own 100% of the entities, hire the workers, set wages, supervise the work, and do all of the employment-related bookkeeping. There is no question that the performance of the employees was controlled by the Emamis. Third, the three companies had a common business purpose of property management with OGC supplying the labor and the other two companies providing the need for the labor.
Because Defendants’ three businesses have related activities, are under the common control of the Emamis, and have a common business purpose, they are properly treated as a single enterprise engaged in commerce under sections 203(r)(1) and 203(s)(1)(A) [of the FLSA].
Moreover, there was evidence that David Emami knew what he was doing was wrong, and that he threatened to retaliate against anyone who participated in the DOL’s investigation:
Pedro Camarillo testified that David Emami told him that if the government called, he was supposed to hang up. And if the government sent a letter, he should destroy it by using a shredder or tearing it up in pieces and putting it down the toilet. Pedro Camarillo further testified that David Emami suggested that the employees just change their names and phone numbers. Although David Emami did not explicitly state why he was afraid of the government’s investigation, he made clear to Pedro Camarillo that if any of the employees received money as a result of the investigation, he would fire them.
Finally, the Court concluded that the evidence established that the Emamis’ violation of the part of a deliberate “scheme,” in which the Emami’s attempted to avoid their obligations under the law:
Defendants did not act in good faith. For the reasons previously explained, Defendants had no honest intention to follow the law but instead purposefully intended to evade the law’s requirements. They had no reasonable grounds for believing that their conduct complied with the FLSA because the evidence establishes that despite their knowledge of the overtime law, they created a scheme by which they denied their employees overtime wages
Perez demonstrates that there are still many employers out there who knowingly attempt to cheat their employees out of lawfully earned wages, and who jealously attempt to thwart any effort by employees to be paid.
If you believe that your employer is not paying you all of your wages for all of your lawfully earned overtime compensation at a rate of one and half times your normal wages as requires under the Federal Fair Labor Standards Act or Ohio Minimum Fair Wage Standards laws or you are an nonexempt employee that has been misclassified as exempt or independent contractor, contact the attorneys at The Spitz Law Firm today for a free and confidential initial consultation. The wage and hour lawyers at The Spitz Law Firm will provide you with the best options for your overtime pay dispute situation. If you even think that you may be entitled to overtime pay that you are not being paid, call 866-797-6040.
The materials available at the top of this overtime, wage and hour web page and at this employment law website are for informational purposes only and not for the purpose of providing legal advice. If you are still asking, “Am I entitled to overtime?”, “Does my job have to pay me for …”, “My paycheck is not right…” or “What do I do if…”, the your best option is to contact an Ohio overtime attorney to obtain advice with respect to FLSA questions or any particular employment law issue. Use and access to this employment law website or any of the links contained within the site do not create an attorney-client relationship. The legal opinions expressed at the top of this page or through this site are the opinions of the individual lawyer and may not reflect the opinions of The Spitz Law Firm, Brian Spitz, or any individual attorney.