Pactrack Settles $160K Wage Dispute Class Action
Table of Contents
Case Background
A legal challenge against Pactrack, Inc., a transportation and logistics company, concluded with a settlement. The class action lawsuit, which former employee Carmen Bustamante filed, claimed that the company had systematically failed to pay its hourly workers correctly under California's strict labor code. Bustamante asserted that Pactrack’s practices had led to employees being denied proper minimum wages, overtime, and reimbursement for necessary business expenses. Filed in the Los Angeles Superior Court, the settlement brought the litigation to a close in September 2024, preventing the need for a lengthy and unpredictable jury trial.
Cause
The Plaintiffs identified the central cause of the action as the company’s flawed payroll and operational policies regarding hourly employees. The complaint alleged that Pactrack did not correctly account for and compensate all time employees spent working, specifically time spent on activities essential to their jobs but not officially on the clock. This alleged systematic failure to track and pay for all hours worked formed the foundation of the wage claims.
Injury
The injury to the employees was financial and stemmed from the alleged corporate practices. The class members claimed they had suffered direct economic harm because the company failed to pay them for every minute they worked, including overtime hours. This shortfall meant they received less than the legally required minimum wage for their work period. Furthermore, the employees were injured by the company’s alleged failure to reimburse them for necessary business expenses, forcing them to absorb company costs themselves. They also sought statutory penalties for inaccurate pay records.
Damages Sought
The lawsuit asked the Court to order the company to provide a comprehensive financial remedy for the affected workers. The complaint demanded recovery of all unpaid minimum wages and overtime pay. It also sought damages for the company's failure to compensate for all hours worked and to reimburse employees for business expenses, which the law requires. Beyond compensatory damages, the Plaintiff sought civil penalties that state law imposes on employers for various violations of the Labor Code, as well as an order compelling the company to change its policies going forward. Finally, the suit demanded payment of all attorneys' fees and litigation costs the class had incurred.
Key Arguments and Proceedings
Carmen Bustamante filed the initial complaint on March 21, 2022, officially starting the lawsuit. The case proceeded as a class action, which allowed hundreds of other current and former hourly employees to join the claim under the umbrella of a single legal action. The proceedings focused on investigating company-wide policies and analyzing large sets of payroll data to determine the extent of the alleged wage violations before the parties successfully negotiated a settlement.
Legal Representation
Plaintiff(s): Carmen Bustamante and all similarly situated employees
· Counsel for Plaintiff(s): Kane Moon | Lilit Tunyan
Defendant(s): Pactrack, Inc.
· Counsel for Defendant(s): Johnson Timothy Lloyd
Key Arguments or Remarks by Counsel
The legal arguments focused on the specific rules governing compensation for non-exempt workers in California, and whether the company's operational demands violated these rules.
Claims
The Plaintiff raised multiple claims against the company, which detailed various ways the employees were allegedly underpaid.
Failure to Pay Minimum Wages and Overtime The most fundamental claim alleged that the company did not pay employees for all hours worked, which resulted in a failure to pay minimum wages and, in some cases, the correct overtime premium. The complaint asserted that the company required employees to perform essential tasks before clocking in or after clocking out, effectively forcing them to work "off-the-clock" without compensation.
Failure to Reimburse Business Expenses The complaint included a specific claim that Pactrack failed to reimburse employees for necessary business expenditures. State law requires an employer to pay for all costs an employee incurs while performing their job duties. The lawsuit alleged that employees often absorbed personal costs that the company should have covered.
Failure to Provide Accurate Wage Statements the Plaintiff contended that because the company did not accurately record or pay for all hours worked, the written wage statements (pay stubs) that employees received were false. The lawsuit sought statutory penalties for every paycheck that failed to provide the clear and correct information the Labor Code mandates.
Defense
Attorneys for Pactrack, Inc. vigorously denied the Plaintiff’s allegations. The defense asserted that the company had maintained clear policies directing employees to record all of their work time and that it had intended to fully comply with all state and federal labor laws. The defense argued that if any violations occurred, they were not widespread or systematic, but rather isolated instances that resulted from employee conduct or misunderstandings of policy.
Settlement
The Court formally approved the settlement on September 19, 2024. Pactrack, Inc. agreed to pay a total of $160,000 to resolve all wage and hour claims brought by Carmen Bustamante and the class. The Court deemed the settlement amount a fair resolution given the costs and risks of continued litigation. The gross settlement amount covered payments distributed to the eligible employees, the costs associated with administering the settlement, and the payment of attorneys' fees and costs the Plaintiff's counsel incurred. This approval successfully concluded the multi-faceted labor lawsuit.
Court documents are available upon request at jurimatic@exlitem.com