I just posted last week about an off-the-clock FLSA class action case. Well, maybe it’s the season, or the leaves changing color, but another such case has recently started to work its way through the courts. A putative class of personal trainers at Life Time Fitness Inc. are now seeking conditional class certification in an Illinois action in which the plaintiffs’ theory is that the company sought to avoid overtime by compelling the employees to work off the clock without pay (i.e. overtime). The case is entitled Steger et al. v. LTF Club Operations Co. Inc., and was filed in federal court in the Northern District of Illinois.
The trainers allege that they were paid on commission and classified as exempt under the FLSA Section 7(i) exemption, but allege that they did a great deal of work such as cleaning exercise equipment, performing fitness assessments for prospective clients, completing mandatory classes and walking the gym floor to solicit new business, which did not generate commissions. The plaintiffs allege that if they failed to earn time and one-half the minimum wage through their commission (which is what is needed to qualify for the exemption), they were paid the difference through a supposed “draw” which was later deducted from subsequent paychecks.
The Complaint also alleges that managers were penalized for supervising trainers who failed to make that minimum by incurring the deduction of the draw money from their own earnings. Thus, the managers encouraged their employees to clock in only while they serviced clients, and to perform the rest of their required tasks off the clock. The penalty for not obeying this (illegal) directive was, according to plaintiffs, termination of their employment. The Complaint asserts that “even though personal trainers were in the fitness centers under the control of Life Time performing work, they did not clock in. Personal trainers who did take the draw were instructed not to, and if they did not comply, they were fired.”
Life Time Fitness operates over one-hundred fitness centers in more than two dozen states that currently employ a total of 3,000 personal trainers, according to the conditional certification motion. The proposed class of employees includes Pilates instructors, metabolic specialists, nutritionists and others, in addition to traditional personal trainers; the plaintiffs estimate that the putative class contains 6,000 people.
The plaintiffs’ counsel stated that this procedure was nothing more than a”sophisticated form of denying people wages.” He continued by asserting that the Company “ incentivized their store level management to encourage their workers to work off the clock.” For my part, I know, from experience, that where labor costs are an issue and labor budgets are right, companies, and/or individual managers, can feel sufficiently pressured to cut corners and have people work off the clock. This is always very risky, as all it takes is a single employee, probably one who has been fired (and correctly so) to file a complaint or be the “named plaintiff” in a lawsuit. Then, the efforts made to stay within labor budgets end up blowing the legal fee budget.