Decision: In Beauford v. ActionLink, LLC, the Eight Circuit Court of Appeals reversed a lower court's determination that employees who cashed checks issued by ActionLink that included language that the checks represented full payment for "wages earned, including minimum wage and overtime, up to the date of the check," had waived their rights to additional compensation. The checks were sent to employees following a US Department of Labor investigation into a complaint that ActionLink misclassified its "brand advocates" as exempt and failed to pay them overtime wages. The question of what constitutes a valid settlement was one of first impression for the Eighth Circuit, and the court relied on decisions by the Fifth, Seventh and Ninth Circuits in holding that employees cannot "agree to accept payment," under the Fair Labor Standards Act, unless they are given notice of the rights they are waiving. The Eighth Circuit determined that because the language on the checks did not adequately notify employees of the rights they were waiving, the waiver was inadequate.
Impact: This case adds to the authority finding that an agreement to waive claims must provide clear notice of the waived claims and also document an employee's agreement to the waiver.