Costco Employee Unpaid Wages Settlement: $2.95M

Non-exempt Costco hourly employees who worked between April 12, 2021, and January 29, 2024, are eligible for settlement benefits.

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A class action lawsuit alleging wage and hour violations has been settled with Costco Wholesale Corporation. The lawsuit represented Costco hourly employees who claimed they were not properly compensated for meal and rest breaks, as well as for wages earned through Costco’s payment structures for Hero Pay, sick leave pay, and Extra Checks.

Plaintiffs argued that Costco’s policies and practices resulted in underpayment for hours worked, including off-the-clock labor. Specifically, the lawsuit challenged Costco’s calculation of meal and rest premiums, claiming that the company failed to comply with California labor laws regarding these mandatory breaks. Additionally, the complaint alleged that Costco’s payment structure for Hero Pay, sick leave pay, and Extra Checks improperly offset wages owed to employees.

Costco denies any wrongdoing but has agreed to a $2.95 million settlement to resolve the lawsuit and compensate affected employees. The settlement aims to provide relief to employees who were impacted by the alleged wage and hour violations.

Eligible class members will receive Individual Class Payments based on the number of days worked during the Class Period. Additionally, eligible employees may also receive Individual PAGA Payments. 

By participating in the settlement, you give up your right to sue Costco over these specific claims regarding unpaid wages and meal and rest premiums. The settlement also includes a payment to the California Labor and Workforce Development Agency (LWDA) as a penalty under the Private Attorneys General Act (PAGA).

No claim form is required. Eligible class members will automatically receive payments unless they opt out of the settlement. The opt-out deadline: September 23, 2024. You cannot opt out of the PAGA portion of the settlement.

Note: The settlement amount will be distributed among eligible class members based on a pro-rata basis, meaning the payment will be calculated based on the number of days worked compared to the total number of days worked by all eligible employees.