Employment & Labor Insider

A recently filed class action against SKIMS Retail LLC and related entities is the latest reminder that even high-profile brands are not immune from California wage-and-hour litigation. Filed in Los Angeles County Superior Court, the lawsuit alleges a wide range of violations of the California Labor Code, including unpaid overtime, missed meal and rest breaks, inaccurate wage statements, unreimbursed business expenses, and untimely final pay.

SKIMS is Kim Kardashian’s shapewear company.

Allegations are only allegations, but the case highlights how quickly routine payroll and scheduling practices can evolve into costly class and representative actions, particularly for employers with large hourly workforces.

The allegations

Plaintiff David Knight, who worked for SKIMS as an hourly, non-exempt employee, alleges the company maintained policies and practices requiring employees to work through meal and rest periods without proper compensation. Mr. Knight also claims that employees were not fully compensated for all hours worked. He also contends that certain forms of compensation -- including shift differentials, commissions, bonuses, and other non-discretionary payments -- were improperly excluded from the regular rate of pay used to calculate overtime compensation.

In addition to the overtime and break-related claims, Mr. Knight alleges that payroll records were not properly maintained and that wage statements failed to accurately reflect total hours worked and applicable wages earned as required by California law.

Finally, Mr. Knight alleges that he and other employees incurred unreimbursed business expenses during their employment and that former employees were not timely paid all wages owed upon separation, giving rise to waiting time penalties under the California Labor Code. The lawsuit seeks damages, restitution, statutory penalties, injunctive relief, attorneys’ fees, and class certification.

Why employers should pay attention

The Knight lawsuit has attracted attention because of the SKIMS brand and its association with the Kardashian family. However, the allegations are far from unusual. California employers, particularly those dependent on hourly labor, continue to face a steady stream of lawsuits challenging timekeeping practices, break compliance, wage statement formatting, reimbursement policies, and final pay procedures. Even technical or seemingly minor violations may result in significant exposure when pursued on a class-wide basis.

All employers, in and outside California, should consider routinely auditing themselves to ensure that the following wage-hour practices are compliant with applicable law:

• Meal and rest breaks.
• Timekeeping and off-clock work.
• Overtime and regular rate calculations.
• Accuracy of wage statements.
• Expense reimbursement policies.
• Final pay and separation procedures.

Employers should also ensure that supervisors and managers are properly trained on scheduling, break compliance, and timekeeping expectations. Violations are generally more likely to occur on the front lines.

The bigger picture

High-profile consumer brands often attract public attention when lawsuits are filed, but the underlying allegations in the SKIMS lawsuit are far from unique. Employers of all sizes continue to be targeted for alleged payroll and break-related violations, particularly in industries dependent on hourly labor.

The SKIMS lawsuit is a reminder that no employer is immune from California wage-and-hour scrutiny and that preventive compliance efforts are far less costly than defending class action litigation.