$9 Million GNC Wage Settlement Gets Court Approval

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By Lisa Nagele-Piazza

April 28 — General Nutrition Corp. and a class of about 8,000 California sales associates and assistant store managers received preliminary court approval April 27 of a $9 million deal to settle wage and hour claims.

The settlement comes nearly four years after lead plaintiff Charles Brewer filed his initial complaint asserting various claims, including that the health-product retailer required hourly employees to work “off-the-clock” hours and didn’t permit workers to take meal and rest breaks as required by California law.

In November 2014, Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California certified the class to include all hourly employees who worked as sales associates or assistant store managers in California from July 22, 2007 to Nov. 12, 2014 (222 DLR A-2, 11/18/14).

But Rogers excluded the workers' proposed “off-the-clock” subclass, finding that the procedures employees followed to make alleged off-the-clock bank deposits depended more on each store manager's practices than a common company policy.

For the same reason, Rogers decertified the workers' off-the-clock collective claim that was brought under the federal Fair Labor Standards Act.

The settlement agreement will resolve all remaining issues in the case, including the named plaintiffs' individual claims, according to documents filed with the court.

Agreement Reached Before Jury Selection

The material terms of the settlement agreement were reached with the assistance of a mediator Feb. 5, 2016, the day the parties intended to select a jury for the trial, according to the joint motion for settlement approval.

“After weighing the certain and immediate benefits of these settlements against the uncertainty of trial,” the workers and their attorneys “believe the proposed settlement is fair, reasonable and adequate,” the motion said.

The settlement terms include respective service enhancement payments for the named plaintiffs of $15,000, $10,000, $7,500 and $2,500, depending on their level of involvement in the case.

In exchange for the service payments, the named plaintiffs will agree to release all their individual claims and “causes of action of every nature and description whatsoever.”

Class counsel will seek $2.7 million of the settlement fund for attorneys’ fees and up to $300,000 for litigation expenses.

Rogers approved the notice to be mailed to class members who will have an opportunity to opt out of—or present objections to—the settlement agreement.

A final fairness hearing is scheduled for Aug. 23.

Hoffman Employment Lawyers LLC and Chavez & Gertler LLP represented the workers. Littler Mendelson PC represented GNC.

To contact the reporter on this story: Lisa Nagele-Piazza in Washington at lnagele@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com