Fraud Investigators for Insurance Firm to Receive $5.4M in OT Deal

Fraud Investigators for Farmers Insurance have recently had their class action settlement approved by the court. The $5.4 million settlement approval comes three years after the case was filed under the Fair Labor Standards Act (“FLSA”) as well California labor laws. Almost 80 investigators are set to benefit from this settlement, with each receiving, on average, $47,000, which was heralded as a “very good result” by the U.S. Magistrate Judge and believed it would “guarantee substantial relief to plaintiffs” during a time of great economic uncertainty.

The class action had alleged that Farmers, the inter-insurance exchange that sells homeowners insurance, auto insurance, commercial insurance, and financial services throughout the United States, had improperly classified its fraud investigators as exempt from receiving overtime. These special investigators consistently worked over 40 hours per week, routinely working through rest periods and meal breaks, due to their high case load requiring them to investigate potentially fraudulent insurance claims each month. They alleged that under the FLSA they should have been paid overtime at time and a half their regular hourly rate when working these long hours. Those affected include anyone who worked for the insurance firm as a special investigator in California between 2013 and 2018.

Unfortunately, many industries often misclassify their employees as exempt from overtime even though they are entitled to overtime pay under the law. If you’ve worked in the industry as an investigator or in a similar position with long hours and no overtime compensation, you may be entitled to recover owed wages. To find out more information or to speak with one of our representatives for a free and confidential consultation, do not hesitate to call our firm, Fitapelli & Schaffer, LLP, at (212) 300-0375 or visit our website here.