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Class-action Suit Filed Against Family Video

15 Mar, 2011 By: Erik Gruenwedel

A class-action lawsuit has been filed against Family Video alleging the largest privately-owned video rental chain in the country with more than 6,500 employees forced staff to work “off the clock” without getting paid for standard and overtime hours.

The suit, filed March 14 in U.S. District Court in Chicago, claims former employee Darvette Smith was not fairly compensated for standard and overtime hours worked at three Family Video store locations in Des Moines, Iowa, from November 2008 to January 2011.

The suit claims Glenview, Ill.-based Family Video with 730 stores in 19 states violated provisions of the Fair Labor Standards Act in an effort to strictly manage its labor costs. Unpaid work included assisting customers, opening stores, maintenance, making required phone calls, completing inventory-related tasks, stocking shelves, and closing down stores, which required balancing cash registers and making off-site bank deposits.

“The law requires that employees be paid for all the work they do. Unpaid work each day adds up quickly and can make a big difference in employees’ paychecks, particularly in these tough economic times,” said Matthew George, an attorney with San Francisco-based Girard Gibbs LLP, which filed the suit with Hagens Berman Sobol Shapiro LLP in Chicago.

George said the unpaid compensation includes hours worked below Family Video’s mandated limit of 40 hours worked per week. He said “off the clock” litigation is typically standard between retail establishments.

“We get quite a few complaints that this [occurs] in this economy,” George said. “Obviously, employers are trying to cut down on labor expenses, which sometimes can result in these types of practices.”

The complaint, which requests a jury trial, seeks unspecified compensatory and liquid damages, in addition to legal fees. Due to the case being filed as a collective action, registered plaintiffs could receive double their unpaid wages and overtime.

A Family Video representative was not immediately available for comment.

Last December, Family Video said it had opened 125 stores since July, employing 1,000 new staffers during that time period. In addition to touting street date availability of new releases, Family Video pledged to charge no more than $2.80 for a new title rented for five days.

“We have never deviated from our model of high service and low-cost entertainment while being an integral part of every community,” Keith Hoogland, president of Family Video, said in a statement at the time.

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