No unjust enrichment claims allowed in state and federal FLSA cases — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

No unjust enrichment claims allowed in state and federal FLSA cases

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Sometimes, attorneys representing disgruntled employees will try anything to make the charges stick. Now the federal district court in Minnesota has ruled that plaintiffs can’t add state unjust enrichment claims to standard overtime claims under the federal Fair Labor Standards Act (FLSA) and Minnesota’s similar state law.

Recent case: Amy Maranda sued HealthPartners on behalf of herself and other similarly situated employees after she claimed the company had wrongly classified her as an exempt administrative employee.

The FLSA requires employers to pay overtime for workers who put in more than 40 hours per week unless they fit into one of several exemptions—such as the administrative exemption Maranda’s employer allegedly used to avoid paying her overtime. Maranda also claimed that the company denied her a benefit under its 401(k) account because it didn’t count her claimed (yet unpaid) overtime wages.

Then, Maranda’s attorneys added one more claim: They said the employer also unjustly enriched itself under Minnesota’s common law. Maranda claimed that the company enriched itself at her expense when it wrongly classified her and others in her job classification as exempt. In other words, by keeping the potential overtime payments, the company benefited and Maranda lost out.

The court refused to allow the additional claim in this case. It reasoned that existing overtime laws were an adequate remedy. (Maranda v. HealthPartners, No. 07-4655, DC MN, 2008)

Final note: Had Maranda been successful, the consequences would have been frightening for employers. While she may recover twice what she would have been paid in overtime, she could have potentially recovered much more on an unjust enrichment claim.

That’s one reason so many employees’ attorneys try to add common-law claims—they don’t like being limited to what state and federal laws say they can recover and would rather have a jury set the award. Then, the sky’s the limit.

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