As you may know, I enjoy the cases where the tables are turned – like my colleague Jason Usher’s post on “Union Violates Employee’s Labor Rights” or my blog on “EEOC Sued For Failing to Accommodate Employee’s Disability.” Here’s another.
From time to time, my clients have had to deal with lying employees. They lie in an investigation, they lie to the federal agencies like the Equal Employment Opportunity Commission or the Department of Labor, they lie in depositions and at trial. And they’re good at it – it’s often hard to prove that they are lying, which is incredibly frustrating to my clients and to me. So I was happy to hear that one lying employee got her comeuppance recently (although in this case she was actually lying on behalf of the company!). (And by the way, I am not saying that all employees – or even most employees – are liars. These bad apples are few and far between – but they are REALLY infuriating when they pop up!)
The employee was part of a group that sued their employer, Meritage Homes Corp., for violations of the Fair Labor Standards Act. As you all know, the FLSA requires employers to pay at least the minimum wage and to pay an overtime premium of one and a half times an employee’s regular hourly rate for all hours over 40 worked in a workweek. The FLSA also exempts certain categories of employees from these minimum wage and overtime requirements, including outside sales employees. In order to meet this exemption, the employee’s primary duty must be making sales, and he must customarily and regularly (meaning more than occasional but less than constant) perform this duty away from the employer’s place of business (i.e. no mail, telephone, or Internet sales)
In the Meritage Homes Corp. case, the employees, who were salespeople, alleged that the outside sales exemption did not apply to them because they made sales of new homes and mortgages only out of a model home sales office – a fixed site that served as the headquarters for the sales activities, which would make it part of the employer’s place of business. Thus, they argued, they should not have been paid on a commission-only basis, and should have received the minimum wage and overtime pay.
The employee in question testified in the employer’s defense and, in her deposition under oath, she claimed that the day before was a typical work day during which she met with customers outside the office for several hours. She repeated this at trial. Unfortunately for her (and her employer), a surveillance videotape established that SHE NEVER LEFT THE OFFICE that day. And even in the face of this pretty definitive evidence, she refused to back down.
Clearly, the employee had perjured herself. And perjury is a crime. So the U.S. Attorney’s office charged her with “lying during a deposition” and making “false declarations before a court.” Ten months later, she pled guilty to the second charge, in exchange for which the prosecutors agreed to drop the first charge and not oppose her request to the court for less than the statutory maximum penalty of five years in prison and a $250,000 fine.
So, for you lying employees out there – and you know who you are – be very afraid.