Groupon Inc (NASDAQ:GRPN) faces lawsuits from over 1,000 sales representatives who claim it did not pay overtime before and after its 2011 initial public offering. According to Reuters, the workers had been trying to get their cases consolidated and were seeking class action status.
Groupon workers to reorganize
About 1,500 sales representatives who worked for Groupon are pursuing the daily deals giant in connection with claims about overtime pay. The company is accused of violating Illinois’ law on minimum wage. U.S. District Judge Edmond Chang said their claims could not be organized into a class action case because they are too different to justify class action status.
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The judge did, however, say the plaintiffs could reorganize and pursue a class action case that is smaller. He said they could use Groupon’s new management policies, which are more uniform, as markers for a smaller class action. Chang said the plaintiffs have until Sept. 23 to decide whether to pursue individual claims or else suggest smaller class.
Wal-Mart court decision cited in Groupon case
An attorney who represents the plaintiffs at Groupon said they are disappointed with the ruling. A spokesperson for Groupon said they are pleased with it. Class action cases are usually preferable for plaintiffs because they are able to spend less in legal fees and get back more than if each case was brought individually.
Chang cited a 2011 Supreme Court Case involving Wal-Mart Stores, Inc. (NYSE:WMT). Workers’ claims against Wal-Mart have been well-publicized over the years. Chang said the decision in the Wal-Mart case made it more difficult for large numbers of plaintiffs to pursue big class action cases.
This week’s decision showed that the suit against Groupon requested class action status for the periods between Aug. 19, 2018 and March 19, 2011 and Aug. 23, 2011 and the present. During these two periods, Groupon reportedly did not pay overtime to workers. The case also requested class action status for the five months in between that period when the company allegedly paid less overtime than what it was supposed to pay.