Should Employees "Opt Out"?

Generally, an employee will receive a greater individual recovery, if the employee opts out. The benefits of the class action are to the group of employees as a whole in that they discourage the employer from continuing its illegal conduct.

However, if only a limited number of people opt out and you are one of those people, you will get a greater individual recovery and the benefits of the class action. Generally only very few employees opt out because when they receive notification of the class action and the right to opt out, it is smothered with legal print which unless you have a legal background is difficult to understand.

Most of the recent class actions suits have been for wage and hour claims. Typically, an individual claim if brought as a separate matter might result in a ten thousand dollars recovery. However, brought as a class action, the recovery of the class member may be under a thousand dollars.

From the companies view point, if they have a thousand employees, they are settling a hundred million dollar claim for ten million dollars. From your view point, they are settling a ten thousand dollar claim for a thousand dollars.

I recommend that when an employee receives the class action notification with the opt out provision that the employee contact an employment attorney who can explain your rights and options. Generally, an employment attorney may be able to get you more money in a shorter period of time.

For more information, please contact Alan Burton Newman at our office at 310-986-2792.