Three employees of Tires Plus have filed a lawsuit against Morgan Tire & Auto Inc. and Bridgestone/Firestone, alleging they were shortchanged on overtime pay.
The suit, filed in the U.S. District Court for the Middle District of Tennessee in Nashville on Dec. 23, claims that Morgan Tire, which does business as Tires Plus, violated employee compensation laws within the Fair Labor Standards Act by excluding ``production payments''-spiffs or commissions-from the calculation for overtime pay. Nashville-based Bridgestone/Firestone is the majority owner of Tires Plus.
The suit alleges Willie Buchanan, Steve Forgey and Patrick Reeners-all employees or former employees of Tires Plus locations in Tennessee-were not properly compensated for hours worked in excess of 40 hours. The Fair Labor Standards Act requires that employers pay employees at one and a half times their regular rate of pay for all hours over 40, said Charles Yezbak, a plaintiffs attorney. The regular rate includes spiffs and commissions, Mr. Yezbak said.
``I don't know if (Tires Plus) draws a distinction, but in my mind a spiff is a set dollar amount for a sale whereas the commission is a percentage,'' Mr. Yezbak told Tire Business. ``Who knows if I've got that right? Maybe they use the terms interchangeably.''
Morgan Tire officials said the company is reviewing the lawsuit and its allegations. Tires Plus operates 485 outlets across the U.S.
``Morgan Tire & Auto is committed to full compliance with all federal, state and local wage and hour laws,'' said Matt Hoskins, executive vice president of sales and store operations for Tires Plus. ``If during that investigation any errors are found, our associates can be sure that they'll be paid any unpaid overtime legally due.
``Most importantly, we certainly value and respect our employees,'' he added. ``That's why we're going to take that action.''
According to the suit, hourly sales employees at Tires Plus receive $5 for selling a lifetime alignment to a customer for $99 and $2 for selling transmission services or fuel induction services. These spiffs are ``non-discretionary'' because they are awarded based solely upon the products or services sold and not awarded at management's discretion, according to the suit.
Spiffs and commissions can account for as much as 35 percent of an hourly employee's pay, according to a prepared statement issued by Mr. Yezbak's partner firm, Washington-based Woodley & McGillivary.
The plaintiffs claim the dealership failed to include these spiffs in the rate at which overtime is paid. They also claim that Tires Plus deducts 30 minutes per day from each employee's time records regardless of whether the employee receives a 30-minute meal break. The suit alleges hourly employees frequently do not take a 30-minute lunch break and are frequently denied compensation for 30 minutes of time spent working.
In addition, Tires Plus failed to post notices informing workers of their rights under the Fair Labor Standards Act, which is grounds for ``the application of the doctrine of equitable tolling,'' the suit alleges.
The plaintiffs are demanding that Tires Plus pay them-and all other current and former Tires Plus hourly workers who choose to join the suit-back pay compensation and benefits; unpaid entitlements; liquidated damages under federal law equal to their unpaid compensation; plus pre-judgment and post-judgment interest. They also are seeking attorneys' fees from Tires Plus.
Mr. Yezbak said the plaintiffs are seeking a limited class-action lawsuit against Tires Plus and Bridgestone/Firestone in which he and his partners notify other Tires Plus employees of the suit, and then it's up to them to send in a form stating they wish to be parties in the suit. He said he believes this alleged compensation practice is impacting all Tires Plus employees and has been going on for as many as three years.
Regarding Messrs. Buchanan, Reeners and Forgey, Mr. Yezbak said he wasn't certain how long each man has worked for Tires Plus but believes all three have worked there for at least a year.
Bridgestone/Firestone purchased a majority share in Clearwater, Fla.-based Morgan Tire from Larry Morgan in 2001. At the time, the dealership had projected its 2001 sales would total $735 million. Mr. Hoskins declined to disclose current sales numbers.
Morgan Tire's outlets have done business as Tires Plus since 2000 when Mr. Morgan merged his dealership with Team Tires Plus Ltd. of Burnsville, Minn. Prior to that, the company did business under the names of Michel Tire, Avellino's, Olson Tire Total Car Care, Hibdon Tire and Wheel Works.