In an Order and Findings of Fact released on May 2, 2011 after a January 2011 class action trial, the Court of Common Pleas of Philadelphia County found that the owners and operators of the Split Rock Resort had misclassified 259 salespersons as “independent contractors” and those class members were entitled to over $2.2 Million in wages, benefits and penalties plus interest under Pennsylvania’s Wage Payment and Collection Law. The Court also awarded attorneys fees and costs to Elliott Greenleaf. The Court’s detailed Findings of Fact confirm the employers had failed to pay wages and benefits owing to “employees” under Pennsylvania Law, including failing to pay the employers’ share of the employees’ taxes, employee “holdbacks” and “chargebacks” on commissions owed for timeshare sales, and the premiums not paid during the Class Period for unemployment and workman’s compensation insurance.
This post-trial judgment marks one of the first cases nationwide where salespersons have, at trial, successfully challenged the compensation structures for persons who sell interests in vacation and time share resorts such as Split Rock. After the August 2008 Complaint and following extensive discovery, Judge Idee Fox certified the Class as “all persons who were classified by the defendants as ‘independent contractors’ and who did not receive full compensation in the form of wages and benefits from June 1, 2005 until December 31, 2008.” After the denial of substantial summary judgment motions and several motions in limine, the parties elected to proceed to a non-jury trial in late January 2011. Philadelphia lead Plaintiffs Albert Whitehead and Austin Miller Orteneau testified at length, and also obtained judgment in their favor.