The California State Labor Commissioner has filed a lawsuit against California-based ZipRealty Inc., alleging that the company violated state laws by paying its real estate agents less than the state minimum wage. Earlier this month, a similar employment lawsuit was decided in Bakersfield, with the judge awarding the real estate agents substantial damages for unpaid wages and overtime violations.

The California minimum wage laws were enacted by the state legislature in 1937. Currently, employers are required to pay employees at least $8.00 per hour, as well as additional amounts for overtime pay.

In the lawsuit, Labor Commissioner Julie Su alleges that ZipRealty routinely paid its employees less than minimum wage and did not properly compensate them for overtime hours worked. She claims that the company's actions harmed not only the real estate agents it employed, but also competing realty businesses.

"In times like this, enforcement of the minimum wage is critical to maintaining a floor that allows workers to survive," Su said. "This enforcement is important not just for employees, but for hardworking employers who shouldn't have to compete against law-breakers."

In a recent lawsuit filed against ZipRealty in California's Kern County, ZipRealty defended its actions by claiming that its agents were "outside salespersons" and, as such, were exempt from minimum wage and overtime laws. The judge overseeing the case disagreed, finding that the agents worked in their offices more than half the time, and were thus non-exempt. The company was ordered to pay more than $300,000 in damages.

ZipRealty has not commented on the current case, which is seeking $7.5 million in minimum wages, $1.25 million in overtime, and over $9 million in penalties and other damages.

Source: Central Valley Business Times, "California sues ZipRealty in minimum wage dispute," Sept. 26, 2011