Labor Letter - April 2013: Count The Cost Before Waging The War

by Fisher Phillips
Contact

When Sun Tzu wrote “The Art of War” in the sixth century B.C., he probably wasn’t thinking about how his advice would apply to employment law litigation in the 21st century, but he might as well have. One of his most famous quotes from that epic military treatise is “Those who wish to fight must first count the cost.” A recent example from Washington state shows the value of following this sage advice.

The Field Of Battle

Andrew Fiore worked for PPG Industries for a relatively brief period of time, roughly nine months, in 2009.  He was employed as a Territory Manager, which called for him to service retail stores throughout Washington and Oregon, assisting in the selling of paint and paint products for PPG. His actual job involved him managing color samples at the paint counter of these retail stores, including rotating stock, building displays, and performing manual labor. His job also called for him to directly interact with the customers and contractors who were looking to buy products.

PPG considered him an “exempt” employee, which means they paid him a fixed salary and did not pay him any overtime. In their view, his primary job responsibility was “promoting sales,” which meant that he fit into one of the white-collar exemptions that allowed them to pay him a fixed salary no matter how many hours he worked per week. According to Mr. Fiore, he worked a considerable amount of time beyond 40 hours per week during his brief stint at PPG, travelling to and from the 11 stores in his territory, handling after hours email and phone calls, and other functions besides his in-store job responsibilities.

After his employment at PPG ended, Mr. Fiore brought a wage and hour lawsuit against PPG, contending that his duties principally consisted of manual labor and conducting individual sales, and thus he should have been entitled to overtime pay. After sitting down and calculating how much he thought he should have been paid, Mr. Fiore concluded that he had been shorted about $12,000.

Now $12,000 is nothing to sneeze at. It’s a considerable sum of money to the vast majority of people in this country, and someone who believed he earned that money fairly would certainly not want to give it up. From an employer’s perspective – even an international conglomerate – $12,000 is no small chunk of change either. PPG decided after it received the lawsuit that it was willing to fight Mr. Fiore’s efforts to recoup that money and instructed its lawyers to defend the case vigorously. And fight it vigorously they did. For the next three years, the lawyers for PPG and Mr. Fiore waged a battle over this issue at arbitration, then at trial court, then at the Court of Appeals, and finally at the Washington Supreme Court.

When the dust settled a few weeks ago after years of fighting, the courts concluded that Mr. Fiore was entitled to recover his $12,000 (now doubled to $24,000 as a punishment for “willfully” withholding the overtime pay). And to cap it all off, the Court also told PPG that it had to reimburse Mr. Fiore’s attorneys their fees for fighting the case on his behalf, which total over $700,000. Yes, you read that correctly – nearly three quarters of a million dollars spent fighting over $12,000.

Could It Still Be Worth It?

This is not necessarily an uncommon scenario. For a variety of reasons, employers often far outspend in defense costs what it would have taken to simply settle a case early on. In PPG’s view, this matter was a “test case” that would have national implications for many of its workers, which is one reason to go toe to toe all the way to the state Supreme Court.

In many other cases, employers decide to draw a line in the sand and fight a particular case to set an example for other disgruntled workers (or former workers) who may be thinking about filing a lawsuit but will think twice if they know the company will forcefully fight their case. In still other cases, employers just decide to fight a case on principle grounds – they know they are in the right, and they would rather spend money defending their position than “paying off” someone undeserving of any reward.

Of course, all of these reasons are quite justified, and at the end of the day PPG might say that they would do it all over again if they had to.  But for some employers, another quote from Sun Tzu’s Art of War might be applicable when thinking about fighting employment litigation: “He will win who knows when to fight and when not to fight.” For some companies, spending $700,000 to fight a $12,000 claim is worth the money. For many others, this story is a cautionary tale about when to fight and when to think about resolving a case in a different manner.


For more information contact the author at RMeneghello@laborlawyers.com or (503)252-4262.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Fisher Phillips | Attorney Advertising

Written by:

Fisher Phillips
Contact
more
less

Fisher Phillips on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
Feedback? Tell us what you think of the new jdsupra.com!