Fashion Institute Sued for Not Paying Overtime to Employees

Reading ContractA local Fashion School is defending itself against current and former teachers in a class action lawsuit for unpaid wages. The lawsuit was filed against the Fashion Institute of Design & Merchandising, FIDM, on October 28. The teachers in this class action claim that FIDM did not pay overtime and did not reimburse them for expenses.

FIDM is a fashion school with branch campuses in Irvine, Los Angeles, San Diego, and San Francisco. The lawsuit’s lead plaintiff is Amanda Ferguson. Ferguson alleges that certain teachers at FIDM were not properly paid overtime, although they regularly worked more than 8 hours a day and worked for more than 40 hours a week. The lawsuit also claims that the teachers were not reimbursed for travel and business expenses. The lead plaintiff also claims that she was fired without being paid the wages that she had earned.  The lawsuit was filed in Los Angeles Superior Court. Ferguson is a former faculty member of FIDM’s Los Angeles branch.

California Overtime Law for Post-Secondary Teachers and Professors

The Industrial Welfare Commission specifies in wage order 4-2001 that certain professional employees are not entitled to overtime wages, if the professional meets the following criteria:
1.    They are licensed or certified by the State of California to engage in a listed profession, which includes teaching;
2.    The professional uses independent judgment  and discretion in performing their duties;
3.    The professional earns no less than twice the minimum wage for full-time work (currently $33,280);

A teacher must also teach in an accredited college or university or under a certificate from the Commission for Teacher Preparation and Licensing to qualify for the exemption.

This lawsuit is interesting because postsecondary professors are generally exempt from overtime requirements, as long as they earn at least $33,280. However, the Department of Labor Standards Enforcement has stated that this exemption only applies to institutions that grant bachelor’s degrees or other higher degrees. Not all of FIDM’s programs are bachelor degree programs; according to their website FIDM also has Associate of Arts programs and art and design programs. Although both of these programs are accredited by respectable institutions, it is unclear whether these programs’ accreditation is good for the purpose of the overtime exemption.

Nevertheless, it is very likely that these teachers will be considered exempt because in 2003 the California Court of Appeals determined in California School of Culinary Arts v. Lujan that schools need not provide bachelor’s degrees to allow its teachers to fall under the overtime exemptions.

Failure to Pay Wages Due and Waiting Time Penalties

Even if FIDM can show that its teachers were properly classified as exempt from overtime, generally there are a myriad of other technicalities that can result in significant losses for a business in these types of class action lawsuits. For example, if a business does not pay wages due after a termination or quit within the time specified in the California Labor Code, the employer will be required to pay special damages equal to the daily amount that the employee earned for each day that the employer fails to pay the employee, up to a maximum of 30 days. In some cases brought as private lawsuits, an early resolution can be worked out for a reduction in the penalties owed.

Orange County Business Defense Attorney

If you are facing a lawsuit for unpaid wages contact the Law Offices of Tony T. Liu. Mr. Liu is a litigation expert and can help resolve your claims in a cost effective manner. Call (714) 415-2007 today.