LOCAL CLAIMS ADJUSTERS ARE VINDICATED AS JUDGE’S ORDER ENFORCES THE JURY VERDICT:
FARMERS INSURANCE EXCHANGE MUST PAY OVERTIME TO ITS ELIGIBLE MINNESOTA EMPLOYEES

MINNEAPOLIS, MN – This week, a Final Order of Judgment in the case, Milner v. Farmers Insurance Exchange, was filed, ending months of legal maneuvering by Farmers Insurance Exchange (“Farmers Insurance”) to avoid having a Minnesota jury verdict enforced against it. In October 2004, following a three-week trial, a Hennepin County jury concluded that insurer, Farmers Insurance, had improperly misclassified certain of its Minnesota claims representatives as administrative employees, in violation of Minnesota Fair Labor Standards Act. The benefit of this misclassification to Farmers Insurance was they could refuse to pay overtime to these hourly workers, saving the insurer millions of dollars. In a somewhat unusual move, the Honorable Gary Larson, the presiding Hennepin County Judge at the trial, contacted a federal judge in Oregon (where other Farmers’ employees are also seeking unpaid overtime), and worked out an Order in the Minnesota case that would enforce the Hennepin jury’s verdict without infringing on the federal case.

Under Minnesota law, employers are required to pay overtime to all employees who work more than 48 hours per week, unless the employer can show that an exemption applies. In this case, Farmers Insurance claimed that claims representatives were ineligible to receive overtime because their jobs were “administrative,” a category of employees who, like managers and professionals, are not entitled to overtime pay. The claims representatives who brought the lawsuit argued this misclassification was improper. According to the Complaint, the claims representatives were deliberately given more work to do than they could accomplish in a normal workweek, while Farmers refused to pay them overtime, based upon their purported classification as “administrators.” The claims adjusters asked for the denied overtime pay and sought a Court injunction, requiring Farmers to properly classify those employees in the future.

In an Order released this week, the Honorable Gary Larson granted final judgment in favor of the employees and awarded injunctive relief and civil penalties to the claims representatives. According to the Zimmerman Reed attorney for the employees, “We are so pleased with this result. Our clients are dedicated, hardworking people. They weren’t asking for a hand-out; they just wanted honest pay for honest work. The jury sent a message to Farmers that, at least in Minnesota, workers’ right to honest pay will be protected.”

If you would like more information, or would just like to talk with a lawyer experienced in this litigation, please call 800-755-0098 for a free consultation or click here to fill out an online free case review.

Helpful Links