STATUS: Resolved

Outten & Golden represents current and former Gristedes grocery store employees in New York who filed a class action lawsuit in federal court seeking unpaid overtime and related remedies. The suit alleges that Gristede’s has avoided paying overtime wages by misclassifying co-managers and night managers as exempt from the overtime requirements of the Fair Labor Standards Act and New York’s Labor Law. The suit also alleges that Gristedes failed to pay other employees for all hours worked.  The Complaint was recently amended to add a fraud claim based on allegations in the complaint that Gristedes systematically cheated workers out of millions of dollars in earned wages by falsifying payroll records.  The Amended Complaint also added claims against the owner of Gristedes, John Catsimatidis, and two senior managers.

On September 29, 2006, Judge Crotty certified this case as a class and collective action. In deciding the motion for class certification in favor of the plaintiffs, the Court observed that “Given Gristedes practice of treating co-managers and department managers as hourly workers, it is irrelevant that some individual plaintiffs or others similarly situated may have assumed duties that would otherwise make them exempt under the regulations. . . . Gristedes clearly sought to treat workers as “hourly” for some purposes (i.e., docking them for hours not worked during the workweek), but “salaried” for other purposes (i.e., not paying them overtime for hours worked in excess of the workweek). The Court also noted that: “Here, the two provisions at issue expressly require that executive and administrative employees be paid a salary. Such salaried compensation, by definition, cannot be the hourly wages Gristedes admitted company policy dictates. Since Plaintiffs have adduced convincing evidence that Gristedes acknowledged company policy treated co-managers and department managers as hourly employees, Defendants cannot defeat commonality by pointing to individualized exemption determinations on the basis of duties.”

According to published sources, Gristedes, a leading New York City supermarket chain, is a subsidiary of the Red Apple Group. Another subsidiary of the Red Apple Group is United Refining, which processes 65,000 barrels of oil a day, distributes fuel to its 372 Country Fair/Red Apple gas stations/convenience stores in New York, Pennsylvania, and Ohio. The Red Apple Group also has real estate, aircraft leasing, and newspaper operations.

(*Prior results do not guarantee a similar outcome.)


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