Pepsi, the multinational beverage and snack producer, has resolved claims of unpaid wages for nearly $13 million after a New York federal judge preliminary approves the deal. Approximately 70,000 current and former hourly employees who were employed by Pepsi between December 1, 2021 and the present stand to benefit from the $12.75 million settlement. The case, originally filed January of this year, alleged that a widespread Kronos hack, that caused an outage of Pepsi’s timekeeping system for several months, caused them to incorrectly keep track of their employees’ schedules resulting in significant underpayment.
The lawsuit specifically alleged that after the Kronos cyber security incident, Pepsi wrongly decided to keep track of their employees’ hours by taking the average of prior payments and other estimation measures. These averaging techniques of past pay periods did not accurately reflect all the hours thousands of employees worked leading up to the busy holiday season and beyond. This caused hourly employees who worked over 40 hours a week to be short on their regular hourly rate pay as well as time and a half overtime pay and additional claims of untimely pay. The case which was brought under the Fair Labor Standards Act (“FLSA”) as well as several state laws will see itself fullyresolved once it receives final approval this upcoming April.
This case prompted several other proposed class actions under the FLSA that alleged unpaid wages due to the Kronos hack. There is no reason why hard working employees should have to carry the cost of the Kronos outage by accepting underpayment for months on end. Anytime an employer decides to calculate its workers’ overtime pay based on a formula that does not take into account the actual amount of overtime completed the result will be illegal pay practices. If you’ve been a victim of improper wage payment, no matter the cause, you may be entitled to recover your pay and damages. Give our employment law firm, Fitapelli & Schaffer, LLP, a call for a free and confidential consultation at (212)300-0375 or visit our website here for additional helpful information regarding your rights.