Verkada Settles Salesperson Class Action Lawsuit For $5.9 Million
Verkada's growth has been fueled by its "Verkademy" and legions of entry-level salespeople, but last year, those tactics led to a former employee suing Verkada.
Now, Verkada has settled the lawsuit, impacting scores of current and former salespeople.
In the report, we examine the legal filings, proposed settlement, the claims, the next steps in the litigation, and the impact on Verkada.
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*** ********** *** ******* ** * lawsuit ******* ** ****** ********** ***** rep *********** ***. ******** *** ******* was ***** **** ** ****** ** California *********, *******'* ********** ** **** expansive **** *** ******** ********* *** includes ********* **********.
*** **** ******* ******** ******* **** former ********* ** *******'* ********** ***** tactics, ******* *** ****-****** "*** *******," and ******** **** *****. *** ****, see:
- ******* ***** ***** ****** ******* ******* Failed ****** ***********
- *** ********* - *** ************* ******* Driving *******'* ***** *******
- ******* ******* ***** ****** ** **** Call ******** **** *******
- *******'* ********* ******* ******* **** ******** Hans *********'* ******
- ******* *********** ********
Settlement ********
** ******** ** *********** **********,*** **** ******** ***** *,*** ******* and ****** ******* *********, ********* ***** 700 ** ********** *** ***** *** elsewhere ** *** **. *** **** encompasses ********* ** ********** *** ****** at *** ******* ** *** **** as ***. **, ****. *** ********* in *** **** ** *** *******, the ******** **** ** ***. **, 2020.
******* *** ****** ******* ***** *********** Representative, ********* *********** **************, ********* (*****) Development **************, ********* ******* *********, ******* Executive (********* ******* ********* ***-***), *** Senior ******* *********.
******** ******* *** ****** ********* ***** receive ** ********* ***** ** $*.** million **** ********** ***** ** ***** employer-side ******* *****, ********* ** *** memorandum. ** ****, ********* ***** **** about $*.** *******. *********' **** ** high ** **% *** ******* ** class ****** *****.
** *******, **** ******** ***** ******* a ****** **** **** $*,***, **** named ********** ********* ****** ****** ** $10,000 ****. ** ******** ** ****** overtime, *** ********** **** ******** ** alleged ****** **** *** **** ****** plus ******* ** ***** ******** **** statements, ******* ** *** ***** *** on *********, *** ******* ** ********* business ********.
*** ********** ********* ********** ** *******:
******** ***% ************* ****, *** ******* gross ******** *** ***** ****** **** be $*,***.** *** *** ********** ****** will ** $*,***.**, *** ******* *** pre-tax ******** *** ***** ****** **** be $*,***, *** *** ********** ******* will ** $***.**.
Verkada *** ********* *****
*** **** **** *** ******* *** admission ** ***** ** ********* ** Verkada ** ******* ** *** *********. The ******* ********* ****** *** *********** in *** ******* *** ****** **** the ***** ********* **** ******** ********** as "******" **** ******** *** ****-******* purposes.
*** ******* **** ******** **** *** documents ** *** **********' *******, ********* payroll ****, ********* *******, ***** *******, compensation *****, *** ******** **** *** handbook. ************, ** ****** *** ********** data "******** ** *** **** ***** it ******** ** *** *********, *** documents ********* ****** ****," ********* ** the **********.
*** **********' ********* ****** **** *** settlement ** ** "********* ****** **** compared ** *** ***** ** *** claims *** **** ********** ** ***** of *** ***** ** ******* ********** and *********’* ****** *** ********* ********."
******** **** *** **** ** *********** with ******* ***** *** **** ***** September ****, **** ******* ** *** ************* ****** ** *** ***** ******, the ******* *** *** ******* ** our ******** *** ******* ** *** accord *** **** *** ******* **** been **** ******.
Verkada's *********
**** ************, ********* ** *** ********** memorandum, ******* ****** **** *** ********* were ****** **** ********** *** ******* overtime ************ ***** "*** ************** *********, the ****** *********** *********, ***/** *** [federal**** ***** ********* ***]’* ******-*********** *********."
******* ******** **** ******* **** ***** Members’ *** ********** *******’commissions ******** **** ***** ************ ****** ************* **.*% *** **% ** *********, respectively, and data showing the FLSA’s highly-compensated exemption applied to Collective Members during 31% of pay periods. [Emphasis Added.]
*** ******* **** ****** **** *** administrative ********* ******* ******* *** ***** workers **** ******* ** ****** **** were "******** ******* ** ********** ** general ******** **********," ** ********* ** the **********. ** ****** **** ********, the ******* ********* ******** **** *** sales ******* "** *** ***** ***** days **** ******* ** ****** ***** calls," ***** ******** *********** ******** ******** by ****** *********.
******* ******** **** ***** *******’ *** Collective *******’ **** *** ******** ******* to *** ******* ******** ********** ** the ******* ******* **** ******** ******* by ********* ***** ******* *******’* “*******” partners.Verkada ******* ******** **** ***** *********** ** *** ***** ***** **** **** ******* ** ****** ***** *****; ******, **** ******* *** ** **********s, spending much of their time learning about the client’s organization and needs and engaging in strategic planning to grow and support existing clients, and exercise discretion in doing so. [Emphasis Added.]
Significant ********
************* **** *******'* ******** *** ** strong ****** ** ******* ********** **** winning ** *****, *** *********'* ********* said **** ************* ********** *** ********* value ** *** ***** ****** **** negotiating *** **********. *** ***** ********* damages, ** ********** **** ** *******, were ********** ** ** **** **** $43 *******.
*** ******* ******** ****** *****, *** estimate *** $**.* ******* *** ********** employees *** $**.* ******* *** *** rest ** *** *******, ********* ** the **********. *** ********* ***** ****** for *** ***** ****** ******* ** about $** *******, ********* ** *** memorandum.
Class ****** **. ********** ******
********* ** ********** *** ********** **** of * "***** ******," ******* **** are ******** ** ** **** ** the ***** ****** **** ************ *** out. ********* ** ***** ****** *** considered **** ** * "********** ******," meaning **** **** ************* ***-** ** they **** ** ** ******** *** receive ********.
*********** *** ** *** **** ** be ******** ** *** ********** *** decide ** ****** ***** ****** ********** in ***** ********. **** ***** ***** that ***** ** **** ****** ** the ****.
Class ***************
***** ***** ***** *************** *** ******** in *** **********, ******************** ***,****** ****, ******** **********. *** ***** ********* ******* **** the ***** ********* ***** **** ****************, compensation, *** *** ****** ** ****** overtime **** ******. ***** ***** ****** employees, ***** ******, ******* ********, *** Michelle *******, **** ********* ************.
Christopher ***, *** *****
********* *****'* ***********, ** *** ******** ** * Senior ******* ********* *** ******* ** California **** *** **** ** ******* 2022, ******* "* **** ******, *********** based ** ** *****, *** ***** variable ************."
*********** *** ***** ******** ************ **** intended ** **** ** **% ** his ***** ****** ************, ** ****. Although ** *** * "*** *********," commissions ******* ** ***** **% ** his ***** ************ ****** ******** ********, he ****.
*** ****** ******** *********** *****, ******* up ******** **** ******* *******, ****-******* potential *******, ******* ** *** ********** demonstrations, *** ******** ****** ********* ** person. ******* ** ******* **** ***** territory, "* ****** **** ***** ******** hours," ** ****. ** *********:
I ********* ******* ******* ** *:** *.*. (*******) *** ****** ***** *:** ** *:** *.*. (*******). Sometimes, there were meetings that took place at 6:00 p.m. that I had to attend. Thus, I ********* ****** **** **** * ***** *** *** *** ** ***** *** ****. Regardless of how many hours I worked, I was never paid overtime, or anything additional beyond my salary and commissions. [Emphasis Added.]
Thomas ****, *** *****
******' ***********, *** ****** ******** **** ** worked ** ** ******* ********* ** the *** ***** ****** **** ******** 2019 ** ********* ****. ** **** he "********* ******* ** *** ****** between *:** *** *:** *.*. ******* time ******* *** ****** * ******* opened *** ******** ******* *:** *** 7:00 *.*. ******* ****."
** *********:
My ******* **** ********** ** **** * ***** *** ***** *** ****** ***** *:** *.*. ******* **** (which was the end of the workday on the east coast). In addition, I worked on the weekends in order to meet all of my job duties, including putting together proposals and building out lists of prospective customers to call for the following week. Thus, * ********* ****** **** * ***** * *** *** **** ** ***** *** ****. [Emphasis Added.]
**** **** *** ***** ****** ****** a ******* ****** ** $*,*** *** a ******* **-****** ******** (***) ** $11,667, ********* ***********. *******, ** ***** earned ****** ** *********** ** ***** his *** ****** *** **********
Kyree **********, *** *****
********* ************'* ***********, *** ******** ******* *** ** a ***** *********** ************** ** ***** 2020 *** *** ******** ** ******* Executive ** ******** ****. ********** ******** at *** ******* ***** **** ****.
** * ***** *********** **************, ********** earned * **** ****** ** $**,*** with *** ********* *** ** ** two $*,*** *********** ******* *** ******** a ******* ****** ** "***** ********* leads." ********** *** **** ** *** Verkademy, *** *******'* ******** **-***** ***** training *******, ** **** ****.
** ** ******* *********, ********** ****** $55,000 ** * **** ****** *** was ******** *** ***********, ***** **** intended ** ** **% ** *** OTE. "*******, * ***** ****** ****** commissions ** **** *** ****** ***," Washington ****.
*** *********** *********:
** ** ******* *********I ********* ****** ******** ******* * **** ********* ** **** *** ***** ***** ******* *** *** **. Throughout my employment, I often ate lunch at my desk because I felt pressure to keep working to reach the targets Verkada set for me. Regardless ** *** **** ***** * ******, *******, * *** ***** **** ********, ** ******** ********** ****** ** ****** *** ***********. [Emphasis Added.]
"Very **** ****"
******* ********* ***********,****** **** ** *** *************** ** *** ******** ** ** Associate ******* ********* ** ******, *****, from ****** **** ***** ******** ****. He *** **** * $**,*** **** salary *** ******** ** ******* "*** small ******* ** ************* $*,*** ** $3,000" *** ********* ********** *** *** not ******** *** ***********.
** ******** ** **** *******, ******* up ********, *** ******* ******* **************, he *** **** *********** *** ********* studying, ************, *** ****** ***** ** part ** *** ******** *******. ****** continued:
I ****** **** **** ****. I ********* ***** ** *** ** *:** *.*. ** *:** *.*. Central Time because I covered east coast territory and as a result worked during east coast business hours. My *** ***** ***** ***** *:** *.*. I ***** ****-**** ****** **** ****** **** ******* * *** ******** ** **** *,*** ******* ** **** **** (***** *** *****) *** ***, which typically entails making 150-200 calls per day. [Emphasis Added.]
"Territory *** ** ****"
*******, * ****** ******* ********* *** Senior ******* ********* ** *** *****, worked *** *** ******* **** ******* 2021 ** ****** ****,********* ** *** ***********. ** ******** ** "*********" ******* overtime ******* ******** ***, ******* **** her *********** **** ******* ******* *** territory *** ******.
*** ****:
** *****, ** *********** **** **** than **** ** ** ***** ************, but ****** ** ****** **** ** employment,my *********** ******* ******* ** ********* *** *** ** **** *** ** ***** *****, ***** *** ****** **** **** * ******* ******* ** *******, ****** ************. Whereas I was assigned to all public sector accounts in half of Wisconsin at the beginning of my employment, in 2022 my territory was reduced to one-quarter of Wisconsin. [Emphasis Added.]
******* *********** ** * ****** ********* among ******* ***********, ****** ***** *******'* growth *********, ** * *********** ******* of ***** ******.
"Never ****** ***********"
********, *** ****** ** * ********* Development ************** *** ********* ******* *********, was ** *** *******'* **** **** City, **** ****** **** ******* **** to ******** ****,********* ** *** ***********.
*** ******** * $**,*** ****** **** "bonuses ***** ** ***** * *********" as ** ***. ** ** ***, she *** **** ** *** ********* training *******. *** ******** * $**,*** base ****** **** "*** ***** ******* of ************* $*,*** *** $*,*** **** I ************ ********* ****** ** *** Verkada *******."
*** **** *** "***** ****** ***** and ***** ****** *********** ****** ** employment."
Next *****
****** ** ******* *****, *** ********** must ******* *********** ******** **** * judge, *** **** ****** *** **** for ******* ** ***** ******** ************. A ******* ** ********* *** ***. 29, ****.
***** *** ********** ******** *********** ********, plaintiffs **** ** **** ******* ***** the ***** *** ************ ** *** to *** ** *** *** ***. A ***** ******** ******* **** ** held ** * ***** ****. **** details ************ ***** ***** ***** ****** ********** are ****.
Impacts ** *** *******
***** *** ******** ********** ****** ** less **** */*** ** *** ********* damages, *** **** ** ****** ********** to *******. *** ********** *** **** reached ***** ** *** ********** *******, limiting *** *******'* ******* ***** *****.
********** ***** **** *** * ***** to **** ** * ****** ** dismiss ** ** ***** *********** ********* for ***** ************* — ** ***** plaintiffs' ******* ******* ******** ********** ** seek ******* *** * ***** ***** — ****** *********** * ****.
***** ** ***'* **** ******* ******* will ****** *** ********* ********* *********** going *******, ** ********** ***** ** would ** ** *** **** ******** to ***** *** **** ** ****** litigation.
******** ****** ***** **** **** ********** of ********** ** ***********, ********* ** meet ******, *** ******** ***** *** constant ****** ** ***** ***** *** failing ** *** *******. *** ********** may **** ****** ******* *********** **** more ********* ** **** ****** **** grievances.
******: * ***** *** ****************** ******** ** *** **********, ***** ***** **** ******* ********* and **-********* *** ***** ****** ** or ****** ***.
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