lunch-bucket-moneyMy friend who works for the city of New York was crowing this month. His union had won its final courtroom verdict against the city and now he's in for a big payday.

The case involved titles. Municipalities and companies across the country bestowed big titles on employees -- making them administrators. Wow! But these workers caught on to the fact that administrators aren't entitled to the same benefits as their underlings, who not only get protection through their unions but, most importantly, mandatory overtime pay.

Show me the money

So they have figured out that it isn't worth it to be a boss. Instead they want the money more than what may, or may not, be an promotion, particularly with the recession biting into their paychecks. Class-based wage claims filed under the federal Fair Labor Standards Act are becoming increasingly more common, according to people I've spoken to in the insurance industry. And some have resulted in multimillion-dollar settlements or verdicts against the employer.

This hurts insurers twice. First, most big companies carry Employment Practices insurance, which protects against the cost of lawsuits by employees. Some of these suits, such as those for sexual harassment, can be minor, but a multimillion-dollar settlement with thousands of workers is a different story. If the judge rules that the employer should have known better, workers can receive up to three years back pay.

And the insurer may also have to shoulder the burden of the lawsuit and pay for the opposition attorneys. In one recent case, a major company had to pay $80 million in attorneys' fees and other costs.

Revolt in the ranks

But I've learned that insurers can also face a revolt in their own ranks: agents, adjusters, brokers and IT personnel who feel they've been wrongly classified as administrative and therefore exempt from overtime when, in fact, they were simply pencil pushers without any authority or discretion. Claims adjusters from Farmers Insurance, account specialists at Aon, and employees at United Healthcare have all won cases or received settlements from their companies. I hear insurance agents at other firms increasingly saying that commissions are not enough, and so are filing claims to at least collect minimum wage.

Both the courts and the Labor Department seem increasingly sympathetic. Employee tasks such as logging on to a computer and phone system, launching software and checking (business) emails are important to their work, and so should be included in their comp time, the department ruled in one such case.

The key factor in determining if an employee is an underling or boss is whether he or she exerts independent judgment concerning significant business affairs, and not just once, but regularly. If you don't, I'd take the money and run.

Pension payoff

My friend has already computed how much he's going to get. The judge agreed with his union three years ago, but the city appealed and lost, so the payoff clock has been ticking all that time. He's looking for straight overtime on every hour he's worked between his regular 35-hour-a-week shift and the 40 hours he often worked. Anything above 40 hours will pay overtime at time and a half, or an additional 50 percent.

Since he already is paid a good annual salary, that's a hefty increase. And the additional money he earns now goes to increase the size of the city pension he'll collect when he retires. So the best title of all: Rich and Retired.