On November 23, 2010, ten current and former employees sued Regent Asset Management Solutions (“RAMS”) for misclassifying its collector employees as independent contractors.  The lawsuit is Chloe Cooper et al v. Regent Asset Management Solutions – Kansas, LLC et al, Case No. 10-CV-2634-JAR-KGG, filed in Kansas Federal District Court in Kansas City, Kansas.

The lawsuit alleges that RAMS wrongfully misclassified its collector employees as independent contractors to avoid paying them minimum wage, overtime, and employee benefits.  Care Group’s failure to properly pay these employees violates the Fair Labor Standards Act (FLSA) and Kansas law.  The lawsuit is a collective class action which means that other similarly situated collectors at RAMS’ facilities nationwide may be eligible to join the lawsuit to recover their unpaid wages.

The lawsuit alleges the RAMS classified its collectors as independent contractors even though the Company initially hired them as employees, controlled the manner in which these individuals worked, set their work schedule, made them work onsite, trained them, and closely managed them.  RAMS informed its collectors that they would no longer be hourly employees and would be moved to commission only independent contractors.  RAMS allegedly then moved its collector employees back and forth between independent contractor and employee status.

Federal and Kansas law may permit these individuals to recover wages for time not paid, overtime wages, an equal amount for liquidated damages, pre-judgment and post-judgment interest, compensatory damages, punitive damages, and attorneys’ fees and litigation costs.  These individuals can seek unpaid wages for the past two- or three-year period from the date he or she joins the case, depending on whether the alleged violations of the FLSA are deemed willful.