IR #2012-43
October 1, 2012

Dean Fryer
Erika Monterroza
(510) 286-1161

Twitter @CA_DIR

Labor Commissioner recovers $4.8 million in unpaid wages in settlement with ZipRealty

San Francisco – California State Labor Commissioner Julie A. Su announced today that a $5 million settlement has been reached in a statewide lawsuit filed last September against ZipRealty to recover unpaid minimum wages for 2,670 of the company’s agents throughout California.
The settlement will recover gross pay for each employee ranging from $503 up to $4,983, depending upon the number of uncompensated weeks worked from April 2007 through August 2010. The average recovery payment for each agent will be approximately $1,800.

The California Department of Industrial Relations’ (DIR) Division of Labor Standards Enforcement (DLSE) became involved in this case in 2010 when four ZipRealty agents in Bakersfield filed wage claims for nonpayment of minimum wage and overtime. DLSE, which is headed by the State Labor Commissioner, later expanded its legal efforts to include all ZipRealty agents in California.
“The Department of Industrial Relations is committed to strong enforcement of state labor laws, specifically the minimum wage,” said DIR Director Christine Baker. “That includes industries such as real estate that are not known for minimum wage issues. In the current economy it is vital that all workers get the compensation they’ve earned.”

In November 2010, Emeryville-based ZipRealty filed an appeal to a wage claim award of about $75,000 to the four Bakersfield agents. After a trial, Kern County Superior Court Judge Steven Schuett ruled in favor of the award for the four agents, and ZipRealty settled the claims for more than $595,000. That ended the Kern County litigation, but the Labor Commissioner sought to recover unpaid wages and overtime for all ZipRealty agents throughout California.

 “Employers considering appealing Labor Commissioner awards should keep the ZipRealty case in mind,” said Commissioner Su. “If our agency determines that violations go beyond the claims before us, we can and will pursue those cases for all affected employees. We learned of ZipRealty’s systemic minimum wage violations during the litigation of these cases in Superior Court.”

The minimum wage claims of these career real estate agents highlight a rapidly changing economy and labor market. In the Bakersfield cases, the ZipRealty agents were illegally receiving no pay for more than 75 percent of the weeks worked. Information received from ZipRealty agents around the state confirmed that minimum wage violations and extremely low annual income was prevalent statewide.

“Enforcement of the minimum wage is critical to maintaining a floor that allows workers to survive. Employers need to do the right thing and obey the law. Those employers that don’t should be prepared to pay twice the amount of wages owed, penalties, interest, and attorney’s fees. It pays to follow the law,” Commissioner Su stated.

With this new settlement ZipRealty will have paid out a total of $5,595,000—74 times the amount of the original awards. The State will receive $200,000 of the settlement to cover attorney fees and costs.

“Violators will be required to defray the costs of litigating labor law violations,” said DIR Director Baker. “The law violators, not the taxpayers, should be primarily responsible for the cost of minimum wage enforcement.”

The California Department of Industrial Relations’ Division of Labor Standards Enforcement adjudicates wage claims, investigates discrimination and public works complaints and enforces state labor law. Additional information on labor laws and work-related topics are available on our Web site, as well as on Facebook and Twitter.

Employees with work-related questions or complaints may call the California Workers’ Information Hotline at (866) 924-9757 for recorded information on a variety of work related topics.

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