Misclassification Case Granted Class Action Certification

KPMG auditors are the most recent group of workers alleging misclassification by their employer. According to the Sacramento Bee, a New York federal court has granted conditional class action status to a group of auditors from KPMG who allege that they were denied overtime illegally. These entry-level auditors claim that they were misclassified as exempt employees, not entitling them to overtime pay and other benefits. They maintain that their classification as exempt violates federal employment standards guaranteed under the Fair Labor Standards Act (FLSA).

KPMG is one of the “Big Four” accounting firms, along with powerhouses Deloitte, PricewaterhouseCoopers, and Ernst & Young. So far, KPMG auditors in Florida, New York, New Jersey, Washington, Nebraska, Texas, and Washington have all reported the same treatment by their employer. According to reports, the lawyer for the class action against the accounting giant said “KPMG audit associates work long hours and make big sacrifices for the company. The least they should be able to expect is for KPMG to follow the law when it pays them.”

The Department of Labor (DOL) has called employee misclassification as an “alarming trend” that frequently leads to wage violations, especially in low-wage industries. There are multiple ways a company can misclassify an employee. Workers can be classified as “independent contractors” instead of company employees, making them exempt from FLSA overtime protections. An employee is considered a worker that has the “right to control” what needs to be done and how it should be done. Conversely, independent contractors are told what tasks need to be done and only determine how the task should be completed. Another method is to label an employee as a manager without giving them managerial responsibilities.

The practice of misclassification is so rampant that the Department of Labor and Internal Revenue Service (IRS) offering a temporary amnesty program for employers to rectify the situation. This indefinite period of amnesty would permit employers to reclassify employees correctly and pay a minimal amount of back taxes, instead of risking lawsuits or fines from federal investigations. If you are being misclassified by an employer, you may be being wrongly withheld overtime pay and other valuable benefits. Contact a devoted overtime attorney to see if you might be eligible to pursue compensation for unpaid overtime or underpayment.