A $1.8 million settlement agreement was approved this month by a California federal judge. The suit was between UPS and a class of workers who accused the shipping giant of failing to pay employees their correct wages and provide accurate wage statements.
U.S. District Judge Philip S. Gutierrez approved the deal Jan. 18th, which resolved the suit between UPS Supply Chain Solutions Inc. and lead plaintiffs Eric Ayala and Adrian Aviles. The Plaintiffs accused UPS of the wage violations as well as failure to compensate workers for work expenses and not providing rest and meal breaks.
"In sum, weighing the clear risks of ongoing litigation against the substantial recovery the settlement provides for the class, the amount offered in settlement is reasonable," Judge Gutierrez said in the order granting the motion for final approval.
The consolidated complaint was filed in May 2020, accusing their former employer of violating the California Labor Code. They said in their complaint that UPS required them to use their personal phones for work duties, travel between work sites while off the clock and that 30-minute meal breaks were not provided to employees.
The parties then engaged in an all-day mediation session in January 2021 but were unable to reach an agreement, according to the judge's order. They later engaged in another mediation session where the parties principally agreed to a settlement proposed by the mediator, according to Judge Gutierrez.
The parties spent several months negotiating the final deal that was eventually agreed upon and filed before the court, the judge's order said.
Out of the $1.8 million total, $600,000 will pay for attorney fees and more than $133,000 will pay the legal costs for the case, according to the order. The lead plaintiffs are set to receive $20,000 each in enhancement awards for their work as class representatives, Judge Gutierrez said.
UPS has also agreed to pay $40,000 in Private Attorneys General Act penalties, Judge Gutierrez said — $30,000 of which will be paid to the California Labor and Workforce Development Agency and $10,000 of which will be paid to PAGA settlement class members.
The class is composed of about 2,100 California UPS employees who will see an average award of $442, with the highest totaling approximately almost $1,700, according to the judge's order.
UPS also agreed to a "key policy change" in the deal, Judge Gutierrez said. It will now pay its nonexempt hourly employees for the time they spend enduring security checkpoints at its California facilities. UPS has agreed to install time-capturing systems at all security checkpoints, a change in policy that the class said "fairly and adequately" addressed the concerns that caused them to sue their employer, according to Judge Gutierrez's order.
Judge Gutierrez said a significant amount of discovery had been completed in the case, signaling that the class members had a clear view of their position to negotiate a fair settlement.
"The court is confident that plaintiffs had enough information to make an informed decision about the settlement based on the strengths and weaknesses of the case," Judge Gutierrez said.
UPS spokesperson Matthew O'Connor declined to comment on the settlement.
"UPS has policies and procedures to ensure that all of our employees are paid for the work they perform," he said.