Bed Bath & Beyond Target of Class-Action Suit Over Overtime Pay

Bed Bath & Beyond is being sued by a group of New Jersey workers who claim the company has been shorting its employees of overtime pay for years. The class-action lawsuit accuses the company of violating New Jersey's Wage and Hour Law by not paying some of its employees time-and-a-half for hours worked over 40 hours. The salaried employees were allegedly paid for overtime work by the New York company with a "fluctuating OT" formula, which would reduce the hourly overtime rates the more hours the employee worked. The class-action suit claims the hourly rate for overtime pay would sometimes come in less than minimum wage, violating New Jersey's labor laws.

Total Retail's Take: With the turnover rate for retail employees higher than most other industries, many retailers are making efforts to promote their store associate positions as a career, not just a job. Higher pay and increased benefits for store associates are selling points that retailers are using in an effort to cut down on turnover at their stores. With respect to this class-action lawsuit against Bed Bath & Beyond, the retailer has allegedly taken steps to curtail overtime costs, possibly as a result of declining sales and profits. With more attractive opportunities out there — Ikea recently expanded paid parental leave for its U.S. employees, Wal-Mart recently raised pay for 1.2 million workers — it may be difficult for BB&B to retain store associates if these claims prove to be true.