Employees’ Suit for Alleged Illegal Payday Loan Scheme Is Dismissed on Summary Judgment by Federal Court in Georgia

Under state and federal law, there are several different types of claims that may arise in an Atlanta wage and hour violation case, including allegations of unpaid overtime, unpaid hours, minimum wage violations, and/or misclassifications. It is important to contact an attorney promptly if you believe that your employer has violated these or other employment-related laws.

Facts of the Case

The plaintiffs in a recent case were current or former employees of a certain manufacturer of portable storage buildings in Swainsboro, Georgia. They filed suit against the defendants, the manufacturer and its chief executive officer, in 2017, asserting a putative class action arising from what the plaintiffs characterized as an “illegal payday lending scheme within the manufacturing facility.” (Certification as a class action was later denied.)

Some 12 causes of action were set initially set forth, including claims under both the federal Fair Labor Standards Act and the Georgia Minimum Wage Law for paying wages below the statutory minimum; a claim pursuant to the Georgia Industrial Loan Act for making payday loans without a license;  a claim pursuant to the both the state and federal Racketeer Influenced and Corrupt Organizations Acts; and a claim pursuant to 42 U.S.C. § 1981 for civil rights violations and racial discrimination.

Decision of the Court

The United States District Court for the Southern District of Georgia, Statesboro Division, granted the defendants’ motions for summary judgment. While affording the plaintiffs’ the benefit of the doubt as to all factual disputes arising from their claims and making it clear that the court did not condone the defendants’ conduct, the court ultimately concluded that no rational juror could find that the defendants participated in or profited from the “payday loan scheme” alleged by the plaintiffs.

In so holding, the court found that the scheme at issue was a “side venture” by a certain sales and general manager and a (now deceased) plant manager, who used their own money to fund a loan scheme in which employees were charged as much as $6 for every $20 borrowed. While the defendants may have been aware of the loans, there was no evidence that they knew the terms of such loans or that they received any profit from the loans.

Hire an Experienced Atlanta Wage & Hour Attorney

There are many state and federal laws in place designed to protect Georgia workers. Of course, this does not mean that every employer operates within the bounds of these laws. If you believe that your employer has failed to comply with wage-and-hour laws, please call Attorney John L. Mays at Parks, Chesin & Walbert at 404-873-8048 and make an appointment to discuss your concerns. As with other types of litigation, please be mindful that strict deadlines may apply, so it is important to take prompt legal action, or else your case may be dismissed as untimely.

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