Newark, NJ: Cosmetics giant Mary Kay is facing a putative employment class action lawsuit filed by New Jersey state residents who worked for the company, alleging they were misclassified as independent contractors and unfairly made to purchase company merchandise as part of their employment.
Specifically, the lawsuit, filed on behalf of New Jersey-based Mary Kay product sellers, alleges the cosmetics company required employees to make non-negotiable payments under threat of termination, for Mary Kay products including marketing materials, uniforms and retail merchandise. These actions are in violation of the New Jersey Wage Payment Law, the lawsuit states. Additionally, the company required that they buy minimum amounts of company products or face expulsion, regardless of whether they had customers to purchase those products.
Further, the lawsuit claims that Plaintiff Ina M. Collins and tens of thousands of others who worked for Mary Kay as sales consultants and directors, were misclassified as independent contractors instead of employees.
"As a result of defendants' conduct, the class members have endured significant economic damages, including all the money they needlessly spent on meeting quotas for product purchases, on overpaying for car leases, on paying for their own advertising, on having to pay taxes on overvalued gifts to them, and on having to pay all of their Social Security taxes as if they were self-employed,"the complaint states.
The lawsuit contends that "Mary Kay Inc. exercises extensive control and direction over the manner of performance of plaintiff and all class members and leaves very little to their discretion." Further, the lawsuit contends that Mary Kay forced class members to pay fixed, non-negotiable prices for numerous types of sales and marketing materials, like pamphlets and DVDs, while not allowing them from formulating and selecting their own marketing schemes.
Finally, plaintiffs assert that Mary Kay required the workers to purchase certain ancillary items and samples for which no commissions were paid and did not count toward their mandatory minimum product purchases. Plaintiffs were required to wear uniforms the company sold to them at non-negotiable prices when attending various meetings, and, on occasion, they had to wear expensive formal gowns for which they had to bear the expense.
Collins is representing plaintiffs who worked as "beauty consultants,"including, but not limited to, all levels of "sales directors"for the company from September 2009 to the present who "were not, and are not, exempt under the New Jersey Wage Payment Law."
Collins is represented by Ravi Sattiraju of the Sattiraju Law Firm PC. The case is Collins v. Mary Kay Inc. et al., case number 2:15-cv-07129, in the U.S. District Court for the District of New Jersey.