Highmark settles federal overtime suit with manager

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A federal judge has approved a settlement between Highmark Inc. and a former supervisor, who said the Pittsburgh health insurer refused to pay overtime wages for work functions performed by her and other mid-level call-center managers.

The settlement, which is confidential, was approved on Monday by U.S. District Judge Kim R. Gibson of the Western District of Pennsylvania, who then dismissed the case.

The mediation that led to the settlement was conducted by former U.S. Magistrate Judge Kenneth Benson; a tentative settlement, struck April 21, still needed judicial approval.

In this case, the former supervisor led a class-action suit filed in February 2013 in Cambria County’s common pleas court, alleging the insurer had violated the federal the Fair Labor Standards Act, as well as the Pennsylvania Minimum Wage Act. The employee, Jacqueline Rummel, worked in a Johnstown call center, and was laid off in 2012 after nearly two decades at the company.

The case was then moved to federal court.

Ms. Rummel said that she and employees in her position were required to work in excess of 40 hours a week, but did not receive the customary overtime wages in return (1.5 times the employee’s hourly wages).

Those managers who work in a “bona fide executive” capacity are generally exempt from overtime regulations, and Highmark argued that Ms. Rummel and those similarly situated were covered by the executive exemption.

But courts have found previously that middle managers are not fully executives, and can receive overtime pay in certain cases.

In November, Highmark sought to have the complaint — Jacqueline Rummel, et al. v. Highmark — dismissed and the proposed class-action terminated, but that motion was denied.

In the settlement, Highmark denied committing any violations of the labor standards act and the minimum wage act, but that it wished to resolve the case to “avoid further expense” and disruptions.

Attorneys for Ms. Rummel declined to comment on the settlement, which applies only to Ms. Rummel, not the putative class of plaintiffs. Highmark also declined to comment. 


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