Ruling: Lids store managers may proceed with pay class-action

January 4, 2018

Indianapolis-based Lids store managers who claim they were denied overtime pay in violation of the Fair Labor Standards Act cleared the first hurdle Tuesday in a proposed class-action lawsuit.

Lids, which sells college and professional sports team branded hats and apparel at more than 1,000 stores and kiosks in malls nationwide, is accused of failing to pay managers for overtime under a fluctuating work week method of payment. Under this method, employees are paid a salary whether they work more or less than 40 hours a week. Hours worked in excess of 40 hours a week are compensated at a minimum of one-half the worker’s normal hourly pay rate.

But the suit alleges Lids store managers didn’t receive that overtime compensation and instead were paid a bonus based on meeting sales quotas.

Judge Richard Young in the District Court for the Southern District of Indiana on Tuesday denied Lids’ motion to dismiss the case and granted the managers’ motion for conditional certification of an opt-in class of current and former store managers.

Young wrote that lead plaintiff Julia Shumate “has made a modest factual showing that she and the potential opt-in plaintiffs were victims of a common policy that violated the FLSA.” At this stage, Young wrote, that showing is sufficient to establish a conditional opt-in class.

The judge ordered Lids to provide an Excel spreadsheet within 30 days listing the names and last known addresses of non-exempt store managers who were entitled to overtime pay since Feb. 2, 2014.

The case is Julia Shumate, on behalf of all others similarly situated v. Genesco, Inc., Hat World Inc., d/b/a Lids Sports Group, 1:17-cv-3574.


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