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On May 1, 2009, the Superior Court of California, County of Los Angeles, determined that Lexmark International, Inc.’s longstanding “use it, or lose it” vacation pay policy was unlawful under California labor code 227.3 and awarded injunctive relief. In October 2009, the damages in the case were tried for the class by Sheila Thomas of the Law Offices of Sheila Thomas and Bonita Moore of Bird Marella et al. The class, including lead plaintiff Ron Molina, consisted of 178 current and former Lexmark employees. Dr. Aukstikalnis was retained by plaintiffs’ counsel, on behalf of the class, to estimate the value of forfeited vacation time, interest and penalties. Based on evidence presented at the damages trial and relying heavily on Dr. Aukstikalnis’ analysis, the court initially awarded $8,299,242 in damages to both current and former Lexmark employees.
On November 17, 2010, after the defendant moved for a new trial, the court requested that the parties submit additional information so that the court could exclude payments to current employees from the damage award. Declarations and briefs were subsequently submitted by both parties. On March 7, 2010, the court amended its ruling, substituting a damages award of $7,774,620 for former employees.
To calculate damages, Dr. Aukstikalnis and her team used historic vacation accrual policy information and employment records to reconstruct vacation and personal day accruals on an annual basis historically for class members. Next, hard copy documents detailing payments made for vacation time at termination were hand coded so they could be subtracted from accruals. Earnings data was then used to calculate the appropriate regular rate of pay, total damages and state-specific penalties. Finally, interest on damages for former employees was calculated from the date of termination through present at the statutory rate. Dr. Aukstikalnis prepared an expert report, testified at trial, and prepared supplemental analyses and declarations in response to the court’s request for additional information. In its statement of decision, the court found that “Lexmark failed to maintain accurate and adequate records of the employees’ vacation usages and forfeitures.” Because Lexmark did not keep accurate business records, vacation day accruals and forfeitures had to be estimated. Dr. Aukstikalnis’ vacation accrual calculations were deemed “reliable” by the court and used as the basis for its initial $8.3 million award. On November 17, 2010, the court granted in part the defendant’s motion for a new trial as to damages for current employees, and requested the parties provide information regarding the amount to be subtracted for current employees. After considering the declarations and rebuttal declarations prepared by both experts, the court relied on the supplemental damage calculations prepared by plaintiffs’ expert, Dr. Aukstikalnis, awarding the class of former employees the $7.8 million in damages, interest and penalties calculated by Dr. Aukstikalnis and her team. If you would like more information on this matter or are interested in retaining the services of Welch Consulting, please contact Dr. Aukstikalnis at 310.260.4876 or aaukstikalnis@welchcon.com.
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Wednesday, 09 March 2011
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Amy Aukstikalnis in the Los Angeles office of Welch Consulting headed a team tasked with analyzing company records to determine damages attributable to unlawfully forfeited vacation time in a class action lawsuit against Lexmark International, Inc. Dr. Aukstikalnis testified at trial and her calculations were used by the judge to determine the damage award granted to the class.
