Overtime Lawsuits For Big Auditing Firm: Could It Lead to Problems For Other Firms?


Class action suits against auditing firms PricewaterhouseCoopers and Deloitte & Touche are raising questions about future lawsuits. Auditors are suing PwC because they say they were denied overtime pay and benefits, and the suit covers all associates and senior associates of PwC in California.

The firm is saying that the auditors were properly classified as exempt employees under California law, and therefore they were not entitled to overtime pay.

The lawyers say something else. They say that under California law, only certified public accountants can be exempt from overtime pay. Most newer associates aren’t yet licensed when they go to work for accounting firms, so this is an interesting strategy.

Also in California is the suit against Deloitte. Tax associates and tax seniors are suing, saying that they should not have been classified as exempt employees, and should have been eligible for overtime pay. The firm says it has complied with all laws.

We are left to wonder what effect this might have on the large accounting and auditing firms. It is no secret that associates and senior associates work long hours and are salaried. If these suits in California are successful, it could lead to suits in other states, costing the Big Four millions of dollars in legal fees and possible backpay for associates.

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