The law firm filing the class-action suit on behalf of Groupon account executives alleging that the daily deal company failed to properly pay them overtime is seeking to certify the suit as a class-action for all Groupon employees, founder and principal of Werman Law Office, P.C., Douglas M. Werman told LAUNCH.
Update: Werman is seeking the class-action status for all Groupon account executives, not all employees, that have been employed by the company during the past three years.
Chicago-based Groupon, which recently delayed its IPO [ see our story ], employs more than 7K people in Illinois and California, according to the nine-page filing.
On the current suit, filed Aug. 19, Werman says, "We're talking about potentially millions of dollars on Groupon's bottom line that they were able to keep that should have gone to the employees. It's a systemic problem."
The suit alleges that Groupon has failed to pay or appropriately pay overtime to its account executives -- the inside sales people responsible for cold-calling businesses for deals, classified as non-overtime exempt employees -- until spring 2011, when Groupon realized the mistake. Since that realization, the company has incorrectly been paying overtime rates, Werman explained.
Groupon has until Monday, Sept. 12, to alert Werman on what action it will take.
Ranita Dailey, a Cook County resident formerly employed by Groupon [this may be her LinkedIn account ], is the lead plaintiff on behalf of other Groupon employees for the suit, PaidContent reported today.
Launch has contacted Groupon for a comment. We will update this story if we receive a response.
This is not the first time the daily deal giant has faced a class-action lawsuit, but it is the first time it faces one from its own employees.
On Aug. 24, a San Francisco judge ruled that parts of another suit filed on behalf of merchants alleging false advertising could proceed after Groupon had asked the judge to dismiss the case.
Groupon's IPO filing mentions it is involved in a number of disputes and regulatory inquiries around its deal business.
"The number of these disputes and inquiries is increasing," the company's S1 reports.
There have also been concerns regarding Groupon's potential insolvency [ see our story ].
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