Ann Taylor to Settle Two California Overtime Lawsuits
New York–based women’s retailer Ann Taylor Stores Corp. announced it has reached a tentative agreement to settle two California class-action lawsuits.
The $6.5 million settlement will result in a one-time pretax charge in the fourth quarter of fiscal 2005, the company said. The charge shaves 6 cents off each publicly traded share for the quarter.
The plaintiffs in the two cases alleged that the company violated California overtime labor laws. The first case, brought by two former store managers Feb. 15, 2005, claimed Ann Taylor misclassified its store managers and assistant store managers and deprived them of overtime pay. The second case, filed May 5, 2005, by a former store manager, alleged violations of California’s overtime and mealtime laws.
In a statement released Feb. 28, the company said it denies the allegations underlying the lawsuits but has agreed to the settlement to avoid significant legal fees and other expenses. —Erin Barajas
