GNC Class Certified to Pursue Overtime Claims

(CN) - A federal judge pared down but nevertheless granted conditional class certification to GNC managers suing the chain for unpaid overtime.

Dominic Vargas and Anne Hickok sued General Nutrition Centers Inc. and General Nutrition Corp. for violations of the federal Fair Labor Standards Act in June 2010.

GNC allegedly practiced an unwritten, de facto policy of encouraging store managers to manipulate their hours in the centralized computer system so that it appeared they had only worked 40 hours per week.

Though Vargas and Hickok served as retail store managers outside Pittsburgh, Pa., and Greensboro, N.C., respectively, they sought to certify a class of GNC managers, assistant managers, and other nonexempt employees nationwide. GNC operates roughly 2,800 stores in the United States.

U.S. District Judge Terrence McVerry in Pittsburgh partly granted conditional certification last week.

"Plaintiffs have produced evidence sufficient for their showing at this stage to demonstrate defendants' efforts to document overtime expenses, to individually identify those who accrue overtime expenses, to demand explanations for each use of overtime, to cast the use of overtime pejoratively with terms like 'abuse' or 'costing' the company money, and to impose consequences for being over the allotted budget in the form of either written warnings or possible termination of employment for managers without regard to the question of whether overtime was necessary or not," McVerry wrote. "Coupled with this is the evidence that supervisors are able to note the time entries for managers and other employees that are subsequently adjusted, and those occasions discovered by plaintiffs that RSDs [regional sales directors] were made aware of off-the-clock work with no action being taken to correct it."

To secure conditional certification, Vargas and Hickok sufficiently demonstrated that GNC's handling of overtime "had the effect of encouraging off-the-clock work through a tone of resistance to reported overtime (authorized or not), and that such an approach was ultimately translated to store managers in the form of a prohibition of overtime in and of itself notwithstanding the written policies set forth in the employee handbook and elsewhere," according to the 19-page opinion.

McVerry limited the class to store managers, eliminating assistant store managers and other nonexempt employees from the collective action.

"According to the evidentiary showing proffered by plaintiffs, it was the limitation imposed on store managers to curtail overtime that collided with the other requirements of operating and maintaining each store and allegedly put the managers in the untenable position of having to complete necessary duties off the clock," the order states.

McVerry further restricted the class to those store managers from the two divisions encompassing Pennsylvania and North Carolina, the areas where Vargas and Hickok worked for GNC and from which they derived their evidence.

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