Bizjournals is reporting that Caribou Coffee has to cough up overtime pay owed to current and former store managers:
Brooklyn Center-based Caribou (Nasdaq: CBOU) was sued in 2005 by three former employees who alleged that the company misclassified its retail coffeehouse managers as exempt from overtime provisions, which they said was a violation of the Fair Labor Standards Act. The suit was eventually expanded to class status, including other current and former managers.
Caribou said Monday in an SEC filing that it would settle the suit, by agreeing to pay $2.7 million, plus its share of payroll taxes.
As I understand this sort of thing, if someone is truly full-time manager they can be paid a salary and not given overtime. However, in most cases, the role of a manager at a Caribou is a combination of managing and front-line work. Or, as Starbucks Gossip explains it, they were “more barrista than boss.”
The old, “give someone a big title, then work them into the ground with no OT” trick.
Looks like it’s been a tough year for CBOU:
I’ve figure out an easy way to turn around Caribou Coffee’s stock performance. Just turn around the stock chart: