La-Z-Boy Settles $1.07M Wage Class Action in California

Case Background

In a significant resolution to a class action lawsuit, LZB Retail, Inc., operating as the well-known furniture company La-Z-Boy, agreed to a settlement. This agreement ended claims that the company had failed to correctly compensate its non-exempt, hourly employees in California. The case, which Dustin Evers originally filed, centered on allegations that La-Z-Boy’s corporate policies and systems had systematically deprived a large group of workers of their full wages and legally required breaks under the detailed provisions of the California Labor Code. The San Diego Superior Court formally approved the settlement in September 2024, bringing the consolidated legal action to a close before it ever went to a jury trial.

Cause

The Plaintiffs asserted that the root cause of the lawsuit lay in the Defendants’ widespread, company-wide employment practices. The complaint claimed that La-Z-Boy designed and maintained payroll and scheduling systems that were inherently incapable of tracking all working time and ensuring compliance with the state's stringent rules for breaks. This systemic failure, the Plaintiffs argued, was the direct reason hundreds of hourly employees did not receive the pay and rest periods they were owed.

Injury

The primary injury to the workers was purely economic. The former and current employees claimed they had suffered financial harm from the company’s inability to properly record and pay for all hours worked. This included time spent working off-the-clock, which resulted in the employees receiving less than the minimum wage for their entire workweek. Furthermore, the class members were injured by the lack of compensation for missed meal and rest breaks, which state law requires. They also sought to recover statutory penalties stemming from inaccurate pay stubs and delayed final paychecks upon separation.

Damages Sought

The lawsuit asked the Court to grant a wide range of financial remedies for the affected employees. The complaint demanded compensatory damages to recover all outstanding minimum wages and overtime pay. Crucially, it sought premium pay an hour’s worth of wages for every single meal and rest break the company had allegedly failed to provide. Beyond actual lost wages, the Plaintiffs asked for significant civil penalties allowed under California law for violations like incorrect wage statements and failure to issue final pay on time. Finally, the suit demanded that the company surrender any profits it had gained by underpaying its workforce, along with all legal costs and fees the Plaintiffs incurred.

Key Arguments and Proceedings

Dustin Evers initially filed the lawsuit on November 12, 2021, and the Court later consolidated it with a similar case, ensuring all affected employees were included in one comprehensive action. The proceedings required an in-depth review of the company's payroll practices and time-keeping records across its various retail locations. Ultimately, the parties entered into rigorous, arm’s-length negotiations and successfully mediated the dispute, avoiding the lengthy and expensive process of a full trial.

Legal Representation

Plaintiff(s): Dustin Evers and all similarly situated employees

·       Counsel for Plaintiff(s): Nicholas J. Ferraro | Lauren N. Vega

Defendant(s): La-Z-Boy Incorporated | LZB Retail, Inc.

·       Counsel for Defendant(s): Sylvia J Kim | Matthew C Kane

Key Arguments or Remarks by Counsel

The legal claims focused on the intricate requirements of California law, and the defense centered on the company's intent and compliance efforts.

Claims

The Plaintiffs raised four central claims regarding violations of wage and hour law.

Minimum Wage and Overtime The core claim alleged that the Defendants had a policy or practice that required hourly employees to perform certain job duties, such as closing down systems or preparatory work, before clocking in or after clocking out. This "off-the-clock" work resulted in employees not receiving payment for all hours worked and sometimes meant they were not paid minimum wage for the entire work period. Furthermore, the lawsuit contended that the company had incorrectly calculated employees' regular rates, leading to an underpayment of the required time-and-a-half or double-time overtime rate.

Failure to Provide Meal and Rest Breaks A central part of the case involved California’s stringent meal and rest period requirements. The Plaintiffs argued that the fast-paced or understaffed retail environment often required employees to miss their paid ten-minute rest breaks or their thirty-minute meal breaks entirely. The complaint specifically sought one hour of premium pay for each missed break, as state law requires.

Inaccurate Wage Statements The lawsuit included a separate claim for the Defendants' failure to provide accurate written wage statements. The complaint argued that because the company had failed to correctly record all hours worked and to calculate the proper pay rates, the pay stubs employees received were inherently inaccurate. The Plaintiffs sought statutory penalties for every paycheck that contained incorrect information.

Defense

Attorneys for La-Z-Boy denied all substantive allegations in the complaint. They asserted that the company had always maintained and distributed policies that directed managers and employees to comply with California’s wage and hour laws, including taking all meal and rest breaks. The defense argued that if any breaks were missed, those instances were isolated events caused by employee preference or individual circumstances, not by a systemic company policy. The company maintained that it had paid all compensation owed and that the claims were either invalid or barred by other legal defenses.

Settlement

The Court formally approved the settlement agreement on September 5, 2024. The approval resulted in LZB Retail, Inc., and La-Z-Boy Incorporated paying a total of $1,075,000 to resolve all claims made by the class members. The Court determined that the settlement represented a fair and reasonable outcome, considering the risks and delays of continuing the litigation. The gross settlement amount covered all payments distributed to the hundreds of eligible class members, funded the administrative costs of the settlement process, and accounted for the attorneys' fees and costs the Plaintiffs' counsel incurred. This resolution effectively ended the litigation over the alleged labor code violations.

Court documents are available upon request at jurimatic@exlitem.com