Atlanta Employment Attorneys Blog
Unpaid overtime lawsuits pursued under the Fair Labor Standards Act are often complex matters. That’s true even if the parties avoid a trial and instead settle their dispute. Getting what you deserve from your settlement requires several crucial things, including negotiating an agreement that meets all your essential needs, executing an agreement that is clear, detailed, unambiguous, and complete, and taking all necessary actions to uphold your rights obtained in that agreement. As you work toward completing any of these steps, representation from an experienced Atlanta unpaid overtime lawyer can be vital to your success and protecting your interests.
A recent case from the federal courts is a relevant example. The lawsuit, which the workers filed in the Northern District of Georgia in 2019, alleged claims of unpaid overtime in violation of the FLSA. Although the workers originally sought more than $800,000 in damages, they and the employer eventually agreed to a settlement of $60,000. The agreement called for the employer to pay $10,000 upfront (within seven days) and then pay $1,000 each month for 50 months.
The contract also stated that if the employer didn’t pay, paid late, or otherwise defaulted on its obligations, the workers were required to contact the employer’s lawyer and give the employer seven days to cure the default. If the employer did not respond satisfactorily within seven days, then the workers were entitled to a $100,000 judgment against the employer and its owner.
According to the workers, the employer didn’t make the June and July 2023 payments on time. The workers allegedly contacted the employer’s attorney by U.S. mail and email but received no response, so they began pursuing the $100,000 judgment.
The problem (for the workers) was that the employer’s attorney had changed firms in early 2021. He had updated his contact information with the State Bar of Georgia and with the court’s electronic docketing system but had not directly communicated with the workers or their counsel (which the agreement did not require him to do.) The copies of the notice went to the lawyer’s old office in Atlanta and his old work email. According to the attorney, he was unaware of the alleged default until the workers’ motion appeared in the court’s electronic docketing system.
The settlement was ambiguous about this aspect of communication, according to the court. The contract included no terms covering a situation where the employer’s attorney changed firms and also had nothing about attorneys’ obligations to provide the other side with updated contact information regarding such a change. When a settlement agreement is ambiguous, the law requires the courts to consider “all the contract terms… together in arriving at the construction of any part.” It also says that “a construction upholding the contract in whole and every part is preferred.”
Actual Notice was Required
From the undisputed and unambiguous portions of the agreement, the court decided that the workers needed to provide the employer’s attorney with actual notice of any alleged default. The agreement’s very short timeframes (like declaring a payment made just one day late to be an actionable default and giving the employer only seven days to fix the default) were integral to the judge’s conclusion. Because the employer’s lawyer didn’t receive actual notice of the alleged default, the workers’ motion failed.
The employer’s successful defense in this motion highlights some useful points. One, it reminds parties pursuing FLSA settlements of the profound importance of extremely detailed settlement agreements that minimize the risk of ambiguities. Two, it reminds parties of the importance of detail-oriented counsel. (Checking the court docketing system or the State Bar’s website might have spared the workers in this case their unfavorable result.)
Wherever you are pursuing or defending an unpaid overtime claim, you can enhance the protection of your rights and your interests by having the right legal team on your side. The knowledgeable Atlanta unpaid overtime attorneys at the law firm of Parks, Chesin & Walbert have assisted many businesses in ensuring FLSA compliance, as well as aiding businesses and workers in handling their FLSA lawsuits. Guided by our in-depth experience, we can provide the answers and advocacy you need. Contact us today at 404-873-8048 or through this website to schedule a consultation.