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Setton Pistachio of Terra Bella, Inc., the nation’s second largest pistachio processor, is offering an olive branch to about 2,000 current and former employees to settle a lawsuit over pay.
But a lawyer representing the plaintiff — and all the other affected employees if a judge certifies a class-action lawsuit — accused Terra Bella-based Setton of downplaying its practice of underpaying workers and trying to get them to settle for pennies on the dollar.
“It’s a lot more money than [Setton is] offering them,” said Kevin T. Barnes, a Southern California attorney representing plaintiff Lilia Ali, a former Setton employee from Tulare County.
Class action looms
If a Tulare County Superior Court Judge certifies the case as a class action suit, the outcome would affect all current and former hourly employees dating back to April 2012.
Barnes said that could be around 2,700 employees, by his most recent estimates.
With a court victory, each could be entitled to hundreds or thousands of dollars in back pay and interest, depending how long they worked for the pistachio processor, he added.
That doesn’t include potential fines or penalties, so it’s no wonder the nut company is trying to whittle down the number of potential plaintiffs with a settlement, Barnes said.
Suit part of ‘pandemic’
Lee Cohen, general manager of Setton Pistachio, said the lawsuit is baseless, describing Barnes and the rest of the plaintiff’s legal team as symptoms of a larger problem of lawyers suing businesses across the Valley on claims with little to no merit to try to collect big bucks.
“It’s a pandemic. They sue first and ask questions later. That’s what’s going on here.”
In a press release announcing the settlement offer, Setton officials state, “we are offering cash settlements to hourly employees who worked between April 27, 2012, and March 1, 2019.”
It goes on to say the company is offering the settlements to address a lawsuit in which, “The company has been accused of failing to pay somewhere between 1 to 3 minutes of pay per workday as employees walked between the front gate and the time-clocks, and while Setton denies these accusations and believes that we paid our employees fairly, we are offering direct cash settlements to ensure that we have no disputes with our esteemed employees.”
The lawsuit — initially filed in 2016 and amended the following year — accuses Setton of not paying its rank-and-file workers for portions of the time they worked and for some overtime.
“They don’t pay on actual time,” said Barnes, who accused Setton of rounding employee start times to the quarter hour when people start and leave work.
So people who showed up early for work punched in, but they were paid from their start times on, not from the actual minutes they clocked in, the attorney explained.
“People generally show up five or six minutes early, and that was rounded up to the top of the hour,” so a worker punching in at 5:55 a.m. would be paid starting at 6 a.m., “So you lose five minutes of pay,” Barnes explained.
The rounding also was done at the end of work day, he added, so “if you end up working eight hours, 10 minutes, they round that [down] to eight. Not only are you not being paid all that time worked, that 10 minutes should be overtime,” Barnes said.
“Employees are our greatest assets, the notion that we are cheating them out of a minute here or a minute there is absurd and laughable,” Cohen said.
Both sides acknowledged that rounding start times is legal.
But Barnes said it’s only legal if it’s done in such a way that the rounding will benefit the business or the employees at about an equal rate, which hasn’t been the case at Setton, Barnes alleges.
Cohen denied that, noting his company’s human resources software that tracks when workers punch in and out is used by tens of thousands of businesses.
“So we’re not doing anything different from anyone else,” Cohen said, noting yearly analysis shows that on average, the rounding “washes out.”
He added that rounding actually benefits his employees, noting that the lines to punch in for work can get backed up, so people who show up for work on time can end up punching in a few minutes late because they were stuck in line, but the system lists them as being on time.
“It’s called ‘smoothing,’ and his assertion’s totally false,” Cohen said of Barnes.
Cohen also said the plaintiff, Lilia Ali, had unsuccessfully sued Setton Pistachio four other times on matters Cohen didn’t specify.
He also challenged Barnes’ estimate on the number of potential co-plaintiffs, saying it may be closer to 2,000, because the opposing lawyers may be counting several hundred workers paid under contract by a separate company that provided them.
Despite Setton’s claim it did nothing wrong, it’s offering a settlement to those workers.
“How much money is 1 to 3 minutes per day? It is worth about 50 cents per day (work shift) on average. Setton is offering a settlement of 50 cents per shift worked between April 27, 2012, and March 1, 2019,” the company announcement states.
“Everyone has the right to decline this offer and instead participate in the lawsuit if they want to. No one knows how long the lawsuit will take (likely years), or what (if anything) employees will receive. You can settle now, or wait to see what happens later,” the statement continues.
Cohen said the lawsuit has had some benefit, in that in March Setton installed new time clocks that scan the palm print of employees, eliminating the use of punch cards.
They have also moved the time clocks to the front gate.
As for the criticism of the settlement offer, “if those plaintiffs’ lawyers are dissatisfied with our efforts to basically correct the problem they are suggesting we have, then they should be happy. If they are genuinely fighting for the workers’ interests, the settlement takes care of that for all parties.”