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Entry-Level Auditors Slap KPMG With Overtime Suit

Law360 - Leigh Kamping-Carder

Law360, New York (January 20, 2011) -- Two former employees have accused accounting firm KPMG LLP of denying a proposed class of thousands of audit associates overtime compensation.

Kyle Pippins and Jamie Schindler filed a complaint Wednesday in the U.S. District Court for the Southern District of New York, alleging KPMG willfully violated the Fair Labor Standards Act by misclassifying them as exempt from overtime wage protections.

The complaint was filed by Justin M. Swartz and Rachel Bien of Outten & Golden LLP and Gregg I. Shavitz of Shavitz Law Group PA.

The audit associate position is “an entry-level job that requires no advanced training” and primarily consists of photocopying, data entry, basic document review, inventory and work as the “lowest-level members of the teams tasked with auditing KPMG's client records,” the plaintiffs claim.

They perform job duties under the close watch of KPMG supervisors and “exercise little, or no, independent judgment and discretion,” the complaint said.

KPMG paid the audit associates a weekly wage, but they regularly worked more than 40 hours per week, and sometimes up to 65 hours per week, for which they received no premium compensation, according to the suit.

The plaintiffs claim the violations are the result of company-wide pay practices.

Pippins and Schindler have asked the court to certify an opt-in class of current and former KPMG audit associates and audit associate “seconds” who did not receive overtime compensation in the three years before the filing of the suit.

The one-count complaint seeks unpaid overtime, liquidated damages, an order preventing KMPG from continuing the pay policy, interest, attorneys' fees and other relief.

Pippins, a Dallas resident, worked at KMPG in Texas from September 2007 through March 2009. Schindler, a resident of Pembroke Pines, Fla., worked at the firm in Florida between August 2008 and April 2009. Both completed the firm's 12-week internship program, the complaint says.

Most of the KPMG audit associates are recent college graduates, according to Swartz, co-chair of the class action practice group at Outten.

“It's a pretty common practice for big companies to require entry-level employees to do nothing but grunt work, make them work long hours, [and] take advantage of their desire to move up in the company by not paying them properly,” Swartz said.

KPMG, headquartered in New York City, recruited roughly 3,700 “campus hires” in 2009 and 2010, according to the complaint. Across the U.S., the firm employs more than 23,000 workers and partners.

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The plaintiffs are represented by Outten & Golden LLP and Shavitz Law Group PA.

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The case is Pippins et al. v. KPMG LLP, case number 11-cv-0377, in the U.S. District Court for the Southern District of New York.