$2.85M Settlement Proposed in Lowe's Employment Class Action Lawsuit

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Santa Clara, CA: A $2.85 million settlement has been reached in an employment class action lawsuit pending against Lowe’s Home Centers LLC. Filed by installation workers for the DIY retailer, the lawsuit alleges that those installation workers were misclassified as independent contractors rather than employees eligible for benefits.

Lead plaintiff Thomas Mittl filed the suit in August 2015 claiming that Lowes classified installers and installation companies providing services to Lowe’s customers as independent contractors rather than employees. This, the suit states, is in violation of the New Jersey Construction Industry Independent Contractor Act and common law unjust enrichment.

The result of the alleged misclassification of “independent contractor” was that it prevented the installers from receiving benefits including liability insurance coverage, workers compensation, temporary disability and health insurance. Further, they were barred them from eligibility for Social Security and Medicare, according to the complaint.

Mittl claimed in the suit that he worked 80 hours a week on Lowe’s jobs, however, he didn’t receive benefits and was required to pay self-employment tax on all income earned from Lowe’s.

Mittl owns Toms River Automatic Door & Window Company in New Jersey. In his complaint, he argues that installation workers should be classified as employees because Lowe’s controlled the work they performed, including designating which customers the installers would work for, inspecting their work, requiring customers to pay Lowe’s directly for all work, submitting the installers to background checks, and requiring them to wear Lowe’s hats and shirts while working.

Mittl worked for Lowe’s for a decade, until his contract was terminated in November 2014, allegedly over his refusal to install windows in a way dictated by Lowe’s, the suit states.

Notably, Lowe’s argued that certain installation companies had signed contracts with arbitration clauses containing class action waivers and that Lowe’s should be indemnified from legal action. Under the terms of the proposed settlement, Lowe’s has agreed to release any claims it had against class members for breach of contract and indemnification.

The settlement class consists of all installation workers or installation companies that signed a contract with Lowe’s to perform installation services on behalf of the company in New Jersey. If the settlement receives preliminary approval it will impact some 450 installation workers and companies, according to court papers.

The proposed settlement motion seeks class certification, appointment of Mitl as class representative and a $20,000 incentive award for Mitl as such a representative, among other things. The case is Thomas Mittl v. Lowe’s Home Centers LLC, case number 3:15-cv-06886 in the U.S. District Court for the District of New Jersey.

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