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California seeks $17 million in back wages from ZipRealty

September 26, 2011 |  2:59 pm

California's labor commissioner has filed a $17-million lawsuit for back wages against a San Francisco Bay Area real estate brokerage, ZipRealty Inc., that markets homes statewide and nationally using an Internet-based sales strategy.

The case is the largest minimum wage enforcement action in California history, according to the California Department of Industrial Relations.

The complaint filed in Alameda County Superior Court accuses ZipRealty of Emeryville of not paying minimum wage and overtime pay to hundreds of agents throughout California.

The lawsuit seeks about $7.5 million in unpaid minimum wages, $1.3 million in unpaid overtime and more than $9 million in damages and penalties.

"In times like these, enforcement of the minimum wage is critical to maintaining a floor that allows workers to survive," California Labor Commissioner Julie Su said. "This enforcement is important not just for employees but for hardworking employers who shouldn't have to compete against law breakers."

The suit is related to a September decision by a Kern County Superior Court judge that ruled that local ZipRealty agents frequently received no pay at all, even though as employees they were entitled to get at least minimum wage for all hours worked.

During the trial, ZipRealty argued that it did not need to pay minimum wage or overtime because the people involved were "outside sales persons." The court disagreed, noting that the agents should have been paid by law because they spent less than half their time working away from their offices.

ZipRealty lawyers did not respond to requests for comments on the lawsuit filing.

The ZipRealty case is a symptom of growing problems in the recession-wracked labor market, said Christine Baker, acting director of the Department of Industrial Relations.

"Violations of minimum labor standards are now occurring in a wide variety of occupations, even affecting employees outside traditional low-wage occupations," she said.

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-- Marc Lifsher

 

 

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