In a Q&A with The Oklahoman, McAfee & Taft labor and employment attorney Kristin Simpsen discussed the recent rise in filings of employment-related class actions and the risks that such lawsuits pose to employers. She said that even though federal employment agencies are expected to scale back their enforcement and litigation activities under the new Trump administration, the number of class action and collective action filings isn’t likely to diminish because the plaintiffs’ bar will likely to pick up any slack in bringing such lawsuits against employers.
“This is especially true given recent court decisions,” said Simpsen, referring to two U.S. Supreme Court decisions — Tyson Foods Inc. v. Bouaphakeo and Spokeo Inc. v. Robins — which have made it easier for plaintiffs to bring and litigate class action lawsuits. “Employers should expect to see — and be prepared to defend — continued wage and hour litigation as well as discrimination lawsuits.”
The costs associated with defending such lawsuits can be staggering to employers. “Judgments in class actions or collective actions have the potential to be very large and often present “bet the company” risks for employers,” she said. “Additionally, even before a judgment or settlement occurs, these actions can negatively impact business operations. Productivity is lost as the employer’s staff compiles the voluminous documents and records needed to defend the lawsuit. The defense of class actions is prohibitively expensive — sometimes costing as much as millions of dollars in legal expenses alone.”
Simpsen recommended employers take action to protect themselves from such lawsuits. Strategies include conducting wage and hour audits, providing regular training to their workforces, and considering the adoption of a mandatory and binding arbitration program that contains a class action waiver.