Bell v. Farmers Ins. Exchange, 115 Cal. App. 4th 715 (2004)

Following a jury trial, Farmers Insurance Exchange was ordered to pay a class consisting of 2,402 current and former claims representatives over $90 million in unpaid overtime and over $32 million in prejudgment interest. The claims representatives contended that Farmers had improperly classified them as exempt administrative employees and had unlawfully deprived them of the overtime they had worked for the three years preceding the filing of the lawsuit. In affirming the judgment, the Court of Appeal rejected Farmers’ assertion that the Court’s earlier opinion in Bell v. Farmers Ins. Exchange, 87 Cal. App. 4th 805 (2001), was wrongly decided and reaffirmed that the claims representatives were non-exempt employees since they were “production workers within the meaning of the administrative/production worker dichotomy and, on that ground… were not employed in an administrative capacity.” The Court further held that the trial court had not abused its discretion in certifying the class of claims representatives since there was an ascertainable class and a well-defined community of interests in the questions of law and fact. The Court did reverse the award of $1.2 million as compensation for unpaid double-time hours on the ground that the flawed statistical methodology that had been used presented “an issue of constitutional dimension.”