WeWork used legal loophole to deny workers overtime pay: report

Co-working company classified low-level jobs as managerial positions

May.May 09, 2017 08:45 AM

Inside a WeWork space (Credit: WeWork)

UPDATED, May 8, 6:30 p.m. WeWork used an exemption in federal labor laws to deny its employees overtime pay, according to a report.

The U.S. Labor Department requires employers to pay higher wages for any hours worked beyond 40 hours per week. But these rules don’t apply to so-called managerial jobs, or positions where workers independently make key decisions for the business. Bloomberg reported that the co-working company for years used that exemption by branding low-level jobs as managerial positions, thus avoiding overtime payments.

WeWork claims that associate community managers do, in fact, carry plenty of managerial responsibilities, and points out that other low-level jobs at the company such as receptionists qualify for overtime pay.

Rachel Wynn, a former so-called associate community manager at WeWork in Washington D.C., told Bloomberg that she spent much of her time giving office tours, brewing coffee and fixing printers. But she was still expected to work long hours without overtime pay. “Because I had manager in my title, I thought that part of my job was staying late,” she said. “I didn’t know it shouldn’t be that way.”

Last year the labor department issued a new rule that any job paying $47,476 or less could no longer qualify as a managerial position, meaning any extra hours would have to be compensated with overtime pay. A month before the rule was supposed to go into effect, WeWork raised the annual pay for associate community managers to $50,000, pushing it above the threshold. A judge ultimately blocked the rule change.

Wynn said she plans to sue WeWork for lost wages.

WeWork, which was valued at more than $17 billion during a recent funding round, has been battling controversy over work conditions at its locations since at least 2015. That year, cleaning workers protested the company over its use of nonunion contractors that allegedly paid wages as low as $10 per hour. [Bloomberg]Konrad Putzier

Related Articles

Sandeep Mathrani and the Four Seasons Residences at The Surf Club (Credit: Four Seasons)

WeWork CEO buys condo at Four Seasons in Surfside

Laura Hines-Pierce and Jeff Hines

Hines CEO talks coronavirus, Opportunity Zones and WeWork

A photo illustration of Pat O’Meara, the historic Security Building at 117 Northeast First Avenue with former WeWork CEO Adam Neumann (Credit: Google Maps, Getty Images, iStock)

Inside the failed crypto auction of a WeWork-leased office tower

Daily Digest Miami

South Florida home sales struggle in October, Cipriani and Terra plan luxury condo

Daily Digest Miami

Ten-X Commercial laid off half of its workforce, Miami professor who taught class on money laundering allegedly laundered millions

Daily Digest Miami

Compass sweetens agent stock program for 2020, affordable housing project in downtown Fort Lauderdale lands $27M loan: Daily digest

Daily Digest Miami

Panattoni drops $24M to build new industrial project near Opa-locka, One Sotheby’s International Realty acquired Treasure Coast Sotheby’s: Daily digest

Daily Digest Miami

Feds say FIU, FDOT contractors at fault for deadly bridge collapse, Infinity Real Estate looks to sell part of Paramount Bay in Edgewater: Daily digest