Gristede’s Loses Overtime Class-Action Suit
New York City A federal judge has granted summary judgment in favor of more than 400 current and former co-managers and department managers of Gristede’s on their claims that the New York City grocery-store chain violated the federal Fair Labor Standards Act (FLSA) and the New York Labor Law by failing to pay them proper overtime compensation for hundreds of thousands of overtime hours.
U.S. District Judge Paul Crotty of the Southern District ruled Thursday that Gristede’s unlawfully “sought to treat workers as ‘hourly’ for some purposes (i.e., docking them for hours not worked during the workweek), but ‘salaried’ for other purposes (i.e., not paying them overtime for hours worked in excess of the workweek).”
The judge also ruled that Gristede’s unlawfully retaliated against two of the plaintiffs by filing “flimsy” counterclaims against them.
The workers will seek nearly $15 million in back pay and damages for salaried employees and $10 million for hourly employees, according to Outten & Golden, the law firm representing the workers in their class-action lawsuit.
This is not the first time Gristedes has been hit with a class-action suit.
In 2003, the chain and its chief executive, John Catsimatidis, settled a minimum-wage class action for $3 million. A multimillionaire, Catsimatidis is reportedly considering a run for mayor of New York City in 2009.
I make it a practice not to attempt to interpret the comp-store sales in February and July. This is due to the lack of reasons for the consumer to buy in these months and the effect of clearance liquidation on sales. The observations I will make about current trends reflects my observations from a tour of stores I made last week.
There is little doubt that current economic factors are affecting some consumers. However, the results of many retailers are being influenced to a greater degree by the content of their inventory. A number of very prominent retailers have simply forgotten who their core customers are and what those customers expect from them. They are aggressively attempting to imitate another retailer or trying to change their customers’ taste level. In all the years I have been in retail, I have never seen this strategy work, and I doubt it will now.
Those retailers that have stayed “in-focus,” featured in the chart, are prospering and appear to have elected not to participate in the economic downturn. My expectations for August are that these in-focus retailers will continue to produce excellent results. Other retailers will talk about how the faltering economy is affecting their sales.
To view the complete Trending Report, go to www.gordmangroup.com .
Robert Gordman is the president of The Gordman Group, Breckinridge, Colo., and is the author of “Secrets of the Super Sweet Spot.”
The View From the Top
I had hoped to climb Mount Fuji in Japan for quite some time and, in July, my friend Sharon and I did just that. Along with our two Japanese friends (sisters Mari and Yuki), we trekked through the night, with only a few flashlights and walking sticks to guide our group nearly 12,388 ft. in the air to see the sunrise the next morning.
After hours of mind-numbing body torture, the consumption of too many power bars and breathing into mint-flavored oxygen cans to survive the thinning air, we finally did it—and the view from the top was more amazing than I had ever imagined.
Along the way, however, the most incredible thing happened: The phone rang.
I was speechless as Mari picked up her cell phone and chatted with her boyfriend who lives back in the United States. Miles in the sky, I could barely breathe the air, yet somehow her wireless service worked perfectly. Mari, who was unfazed, said, “While I have my phone out, I should check if it’s supposed to rain later.”
Internet too? Not only is my own cell-phone service relentlessly spotty back in New York City, it often takes too long to load a Web page. I kept thinking that her wireless carrier should film its next commercial at the top of Mount Fuji.
The United States can learn a lot from looking at the mobile trends currently flowering out East. In Japan, the combination of affordable, sophisticated mobile phones, high-speed networks, increased consumer advertising via mobile devices and the adoption of mobile commerce by companies, ranging from retailers to banks, have made it a highly effective and ubiquitous channel. It’s only a matter of time before it makes a big splash on our shores, according to Hossein Mousavi, the CEO and co-founder of mPoria, a Seattle-based m-commerce solution provider.
“In Asia, mobile commerce has matured into an efficient and firmly established consumer buying channel which allows retailers to reach their consumers anytime, anywhere,” Mousavi said. “It also helps them strengthen profitable customer relationships in ways that have not been possible before.”
Mousavi also noted that the aggregate volume of physical goods bought by consumers through mobile phones in Japan surpassed $6 billion in 2007. These numbers are growing at a rapid rate, now beyond Asia to Europe and the United States. All players in the ecosystem, which range from device manufacturers and carriers to consumers, marketers and retailers—are recognizing the market opportunity for mobile commerce, and many are already engaging in it.
There are more than 250 million wireless consumers in the United States alone, and industry analysts forecast the m-commerce market for retail will exceed $500 million in 2008, Mousavi said. Research has shown that many U.S. consumers are already trying to access retailers’ sites on their mobile phones, but retailers often don’t have a mobile site.
“As a retailer, if you are someone’s favorite site and don’t have a mobile presence yet, you are disappointing a lot of your mobile consumers who immediately surf elsewhere on their mobile phones,” Mousavi said.
It’s evident that something big is forever about to change the way we shop—and retailers need to get ready now to survive the climb to the top.