Small overtime foul-ups can grow into giant liabilities.
Three hospitals in Orange County, CA, owned by Tenet Healthcare, recently settled a class action lawsuit for $85 million.
Here’s what happened:
The suit alleged that to avoid OT costs, Tenet lowered the hourly pay rate for nurses and other employees when they worked more than eight hours a day.
So while the employee technically earned OT, their net wages remained the same as if they hadn’t.
The suit also alleged Tenet used as many as five different hourly pay rates — depending on the length of an employee’s shift.
Roughly, 23,000 current and former employees statewide qualify for settlement payments.
“It’s not enough for an employer to demonstrate that it pays overtime on paper. They have to pay overtime in money, not math,” said Frank Coughlin, a Santa Ana attorney representing one of the employees who brought the suit.
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