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By Porter Wells
A small printing company in Florida isn’t liability for overtime compensation to a former employee because the company’s sales weren’t large enough to be covered by the FLSA, the Eleventh Circuit ruled July 17.
The ruling from the federal appeals court is a reminder that the wage and hour requirements of the Fair Labor Standards Act may not apply to enterprises that rope in less than $500,000 per year in sales or business.
Abalux Inc. submitted records showing it logged annual gross sales in the upper ranges of $400,000 from 2013 to 2016, the years Jesus Collar was an employee. Where Abalux’s sales surpassed $500,000, retail sales tax adjustments brought that number back under the threshold, meaning the FLSA didn’t apply, the U.S. Court of Appeals for the Eleventh Circuit said.
The case also illustrates the pitfalls of pursuing a case too aggressively. Abalux filed seven motions for sanctions in the lower court against Collar’s counsel because they “‘knew or should have known’ that the case ought to be dismissed as meritless,” Leslie Langbein, Abalux’s attorney, told Bloomberg Law in a July 17 email.
The district court issued a sixty-three page order July 5 agreeing that sanctions were warranted because of the “never-give-up strategy of using a full-throttle approach” undertaken by Collar’s legal team, even when it became clear their lawsuit wasn’t supported by the law.
Abalux seeks $40,000 in fees and costs, Langbein said.
Attorneys for Collar didn’t immediately respond to Bloomberg Law’s request for comment.
Langbein & Langbein in Miami Lakes, Fla., represented Abalux. J.H. Zidell, PA, in Miami Beach represented Collar.
The case is Collar v. Abalux, Inc., 11th Cir., No. 18-10676, opinion issued 7/17/18.
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