Facts

Wrike, Inc. is an international company located in San Diego, California, that provides cloud-based project management applications, known as software as a service, with customers paying a monthly amount for its services. From August 2019 until January 20, 2020, Beniyam Kebede worked for Wrike, Inc. as an account manager. Alan Tsai worked for Wrike as a strategic account manager from October 2018 until July 20, 2020. Monica I. Pazmino worked for Wrike as a senior account manager from October 2019 until April 1, 2020. On May 13, 2020, Kebede, Tsai, and Pazmino brought a class action on behalf of themselves and all others similarly situated against Wrike in the Superior Court of Santa Clara County, alleging various Labor Code violations and violation of the Industrial Welfare Commission Wage Order 4-2001. The class included all current and former commissioned employees who worked for Wrike in California from April 6, 2016 to March 31, 2021. The parties mediated with Louis Marin, a respected wage and hour class action mediator, before reaching a settlement.

PLAINTIFFS' CONTENTIONS: Plaintiffs contended that as exempt employees, they regularly did not earn more than half of their compensation in commission earnings as required by law and some or all of the compensation defined by defendants as "commissions" were not bona fide commission under the Labor Code. Further, plaintiffs maintained that defendants had a consistent policy which did not pay plaintiffs all wages due, including overtime wages and wages due upon termination, and systematically failed to record all hours actually worked by plaintiffs. Moreover, plaintiff argued that defendants had a consistent policy which did not authorize or permit plaintiffs to receive: rest periods of at least ten minutes per four hours, duty-free meal periods of at least thirty minutes for shifts of five hours or more, or reimbursement for reasonable and necessary business expenses, including personal cell phone and at-home internet expenses. Finally, plaintiff alleged that defendants intentionally and willfully failed to provide plaintiffs with complete and accurate wage statements.

DEFENDANT'S CONTENTIONS: Defendant denied liability and claimed that even if liability were found, damages would be limited because some positions were reclassified soon after the class period began, and all other positions were reclassified four months before the class period ended. Further, defendant contended that class members met the commission exemption in all weeks they met the compensation test, and in weeks they did not, they met the administrative exemption. Moreover, defendant argued that there were no meal period violations because they did not impede or discourage plaintiffs from taking breaks and in fact, provided plaintiffs with food and a separate space to relax and eat. Finally, defendant alleged that it was unnecessary to use cell phones while in the office and only a reasonable percentage of an employee's cell phone charges must be reimbursed.

Result

$2,000,000 settlement with $1,796,000 in new money and $204,000 from when Wrike paid 102 employees for individual settlement agreements before mediating.