Calif. appeals court upholds judgment against Cintas
A California appeals court upheld a judgment against Cintas Corp. on Wednesday, ordering it to pay more than $2 million to 219 current and former Cintas workers and their lawyers.
The ruling confirmed a trial court’s conclusion that Cintas (NASDAQ: CTAS) was liable for not paying workers at its nearby laundry facilities the minimum wage and benefits required under a Hayward, Calif., so-called "living wage" law. The Cincinnati-based uniform supplier’s plants that serviced the city were bound by that law because Cintas was under contract to supply the city of Hayward with uniforms, shop towels and mats, the courts said.
Cintas eventually terminated the contract after four years, and workers filed a class-action lawsuit to collect back wages and benefits cash advance.
The trial court rejected the company’s contention that the city had no authority to regulate wages at facilities outside the city’s boundaries, and the appeals court agreed with that ruling. If Cintas didn’t want to pay the level of compensation required by the law - $8 an hour for workers without health insurance; $9.25 for those with insurance - all it had to do was decline the contract, which it eventually did, the court said.
The court ordered Cintas to pay about $800,000 in back wages and benefits, plus interest, as well as $259,000 in civil penalties. It also must pay $1.2 million in legal fees to the plaintiffs’ lawyers.