Wage and hour class action news in 2025 and 2026 is dominated by record filings, a cluster of nine-figure settlements, and a run of court decisions and proposed federal rules that are redrawing where these cases can be brought and how far they can reach. Federal Fair Labor Standards Act filings climbed to 5,702 in 2025, the top ten wage and hour settlements of 2024 alone totaled $614.6 million,1Lockton. Wage Hour Insurance Market Update December 20252California Employment Law Report. PAGA Is Not Slowing Down3Seyfarth Shaw LLP. Washington Employment Class Actions Are Surging Below is where the money has moved, what the courts have decided, and what rules are coming next.
The Biggest Recent Settlements and Verdicts
A $398.05 million settlement received final approval from a federal judge in Maryland in June 2025, resolving allegations that roughly 20 major poultry processors conspired to suppress worker pay. Jien v. Perdue Farms, Inc. named Tyson Foods, Pilgrim’s Pride, Perdue Farms, Cargill, Sanderson Farms, and Koch Foods, along with two consulting firms accused of facilitating the scheme by sharing confidential compensation data.4Feedstuffs. Court Grants Final Approval to Poultry Processor Wage Fixing Settlements The settlement class covers workers employed at poultry processing plants, hatcheries, and feed mills across the United States between 2000 and 2021, with individual company contributions ranging from $3 million to $115.5 million and payouts distributed on a pro rata basis tied to tenure and earnings.5ClassAction.org. Poultry Producer Settlements Totaling Nearly $400M It is the second-largest wage-fixing settlement in U.S. history.6Expert Institute. Top Class Action Settlements
At the end of 2024, Walt Disney Co. agreed to a $233 million settlement to resolve a class action brought by tens of thousands of hourly Disneyland employees who alleged the company failed to pay Anaheim’s “Measure L” living wage between 2019 and 2023. The ordinance started at $15 per hour with annual increases. The deal was pending final court approval as of early 2025 and is reportedly the largest wage and hour payout in California history.7iFightForYourRights. Top 5 Largest Wage and Hour Settlements
In Washington, a jury awarded $98 million against Providence Health & Services in April 2024 after finding the hospital system failed to provide mandatory second meal breaks on shifts exceeding ten hours and used a timekeeping system that systematically rounded down work time. Because the court found the violations willful, it doubled the damages and added prejudgment interest, pushing the total to approximately $229.6 million.8Justia Law. Providence Health Case, No. 86321-5-I The Washington Court of Appeals affirmed in October 2025, and Providence filed a petition for review with the state Supreme Court in January 2026, arguing in part that its collectively bargained agreements permitted waiver of second meal periods. The judgment, reportedly approaching $300 million with accruing interest, remains unpaid during the appeal.9Washington Courts. Providence Health Petition for Review
Other substantial 2024 recoveries included a combined $175 million settlement by Uber and Lyft of Massachusetts misclassification claims (Uber $148 million, Lyft $27 million), with non-financial terms adding paid sick leave, healthcare stipends, and earnings transparency;10Lewis Brisbois. Rideshare Case Law Update a $72.5 million California retail settlement over off-the-clock work and time rounding;1Lockton. Wage Hour Insurance Market Update December 2025 and a $31 million Alaska Airlines/Virgin America flight attendant settlement.11Miller Shah LLP. Bayada Nurse Wage Settlement Finalized at $13 Million
Where Filings Are Surging
Private FLSA filings rose to 5,702 in federal court in 2025, from 5,456 the previous year, and the U.S. Department of Labor reported its highest back-wage recoveries since 2019.12Wage Hour Litigation. Wage Hour Litigation Homepage The agency collected $318 million in back pay and penalties in fiscal year 2025, a 33 percent increase over 2024.13Baker Law. 2026 Wage and Hour Nationwide Update Retail, healthcare, and professional services firms remain the most frequently targeted industries, and transportation and logistics companies continue to face significant exposure around independent contractor misclassification. Plaintiffs are winning procedurally too: courts granted conditional certification in nearly 80 percent of first-stage FLSA decisions in 2024, and wage and hour cases achieved an 82 percent success rate on class certification motions in 2025.14Talli AI. Class Action Settlement Statistics
Washington’s Meal-Break Boom
Employment class action filings in Washington went from roughly 68 in 2021 to about 765 in 2025, with about 32 percent of those filings involving meal and rest break compliance.3Seyfarth Shaw LLP. Washington Employment Class Actions Are Surging The driver is the 2024 appellate decision in Androckitis v. Virginia Mason Medical Center, which endorsed a 30-minute penalty payment for each missed or noncompliant meal period on top of pay for any time worked during the break. Because the court treated the failure to pay this amount as a willful withholding of wages, the penalty can be doubled, potentially creating up to 120 minutes of total damages per violation.15Perkins Coie LLP. New Washington Ruling Endorses 30-Minute Penalty for Meal Period Violations The ruling is being applied retroactively and has spurred filings across hospitality, manufacturing, and healthcare.
California PAGA Keeps Climbing
PAGA notices filed with the California Labor and Workforce Development Agency hit 10,098 in 2025, the most ever recorded, even after reforms signed into law in July 2024.2California Employment Law Report. PAGA Is Not Slowing Down AB 2288 and SB 92 created a penalty cap structure: employers that took “all reasonable steps” to comply with the Labor Code before receiving a PAGA notice can cap civil penalties at 15 percent of the default amount, and those who take such steps within 60 days of a notice can cap penalties at 30 percent. The reforms also expanded curable violations and created early case resolution procedures.16Gunderson Dettmer. What Employers Need to Know About Significant Changes to PAGA Filing volume suggests plaintiffs’ attorneys view the capped exposure as manageable.
Court Rulings Changing the Playing Field
Supreme Court Opens the Courthouse Door for Delivery Drivers
On May 28, 2026, a unanimous U.S. Supreme Court decided Flowers Foods, Inc. v. Brock, holding that a worker who transports goods on an intrastate leg of an interstate journey can qualify for the Federal Arbitration Act’s Section 1 exemption without personally crossing state lines. Justice Gorsuch, writing for the Court, rejected the employer’s push for a bright-line rule and reaffirmed that the exemption covers workers who play a “direct, necessary, and active” role in moving interstate goods.17Justia. Flowers Foods, Inc. v. Brock, No. 24-935 Last-mile delivery drivers who handle goods that originated out of state can therefore potentially avoid arbitration clauses and pursue wage claims in court as part of class or collective actions.18Jackson Lewis. Defining Transportation Worker: SCOTUS Again Considers Scope of FAA Exemption
Second Circuit Narrows Nationwide Collectives
The Second Circuit held that federal courts cannot hear the claims of out-of-state workers in FLSA collective actions unless the employer is “essentially at home” in the forum state or has consented to jurisdiction there. The ruling extends the Supreme Court’s 2017 Bristol-Myers Squibb decision to FLSA collectives and deepens an existing circuit split: the Second, Third, Sixth, Seventh, and Eighth Circuits now apply that jurisdictional limit, while the First Circuit does not.19Wage Hour Litigation. Second Circuit Restricts Nationwide FLSA Collective Actions The Supreme Court declined an earlier petition to resolve the split in 2023.20Nelson Mullins. Personal Jurisdiction of Opt-In Plaintiffs Under the FLSA For workers, the decision limits the ability to join nationwide collectives filed in plaintiff-friendly jurisdictions; for employers, it offers a tool to pare down multi-state cases.
Third Circuit: FLSA Claims Can Be Released in Class Settlements
In Lundeen v. 10 W. Ferry St. Operations LLC (October 2025), the Third Circuit ruled that the FLSA’s opt-in requirement does not bar the release of unasserted FLSA claims within a court-approved Rule 23 class action settlement. The court reasoned that while FLSA Section 216(b) requires written consent to litigate a claim, it says nothing about releasing one. Settlements that release FLSA claims must still satisfy Rule 23 fairness standards, with clear notice that class members are waiving FLSA rights and a meaningful opportunity to opt out.21Jackson Lewis. Third Circuit Ruling Makes It Easier for Employers to Settle Hybrid Wage and Hour Actions The decision binds Delaware, New Jersey, and Pennsylvania, and makes it easier for employers to resolve hybrid state and federal wage cases in a single global settlement.
Supreme Court Punts on Uninjured Class Members
On June 5, 2025, the Supreme Court dismissed Laboratory Corporation of America Holdings v. Davis as improvidently granted, declining to decide whether federal courts may certify damages classes that include both injured and uninjured members. Justice Kavanaugh dissented, arguing that “overinflated” classes can coerce companies into settlement. The circuit split remains unresolved.22Workplace Class Action Blog. U.S. Supreme Court Declines to Decide Whether Courts May Certify Damages Classes That Include Uninjured Class Members
California: Arbitration Waived by Litigation Conduct
A California Court of Appeal affirmed in December 2025 that Sierra Pacific Industries waived its right to compel arbitration through “years of litigation conduct inconsistent with an intent to arbitrate,” including failing to produce signed arbitration agreements, not listing arbitration as an affirmative defense, and participating in class discovery and mediation. The court applied a standard that does not require the opposing party to show prejudice.23Ogletree Deakins. California Court Affirms Waiver of Arbitration Rights in Wage and Hour Class Action Case
Federal Rulemaking in Motion
Overtime Threshold Reverts
On November 15, 2024, a federal court in the Eastern District of Texas vacated the DOL’s 2024 overtime rule nationwide. The rule would have raised the minimum salary for white-collar exempt employees to $43,888 in July 2024 and $58,656 in January 2025. The court found the thresholds so high they displaced the duties-based test Congress intended, and it struck down a provision for automatic three-year increases as a violation of notice-and-comment requirements.24SBA Office of Advocacy. Federal Court Strikes Down Labor Department’s Overtime Rule The salary threshold has reverted to the prior level of $35,568.25SHRM. FLSA Final Overtime Rule The government has filed a notice of appeal, and related lawsuits remain pending in two other federal courts.
New Independent Contractor Proposal
In February 2026, the DOL proposed a rule to replace the 2024 independent contractor framework with a streamlined “economic reality” test modeled on the 2021 rule. The analysis centers on two core factors: the nature and degree of control over the work, and the worker’s opportunity for profit or loss. If those are inconclusive, three supplemental factors apply, including skill required, permanence of the relationship, and whether the work is part of an integrated production unit. The proposal emphasizes that actual practices matter more than what contracts say is theoretically possible.26DOL Wage and Hour Division. 2026 Rulemaking on Employee or Independent Contractor Status The 60-day comment period closed on April 28, 2026.27Regulations.gov. Employee or Independent Contractor Status Under the FLSA
Joint Employer Proposal
On April 23, 2026, the DOL published a notice of proposed rulemaking for a new joint employer test covering the FLSA, FMLA, and Migrant and Seasonal Agricultural Worker Protection Act. The rule uses a four-factor analysis for “vertical” joint employment, looking at hiring and firing authority, supervision and control over schedules, determination of pay, and maintenance of employment records, with “exercised control” weighing more heavily than mere “reserved control.” The proposal explicitly excludes common business practices like franchise quality-control standards and participation in benefit programs from the joint employer analysis.28DOL Wage and Hour Division. Joint Employer Status Under the FLSA, FMLA, and MSPA Public comments were due by June 22, 2026.29Federal Register. Joint Employer Status Under the Fair Labor Standards Act
State Laws Reshaping Exposure
A cluster of new state laws took effect at the start of 2026 or are approaching their effective dates.
California’s SB 261, effective January 1, 2026, exposes employers who fail to pay a final wage judgment within 180 days to civil penalties of up to three times the outstanding amount. Courts must impose the full penalty unless the employer proves “good cause” for a reduction by clear and convincing evidence, and penalties are split equally between the affected workers and the state’s Division of Labor Standards Enforcement.30Payne & Fears LLP. California’s SB 261 Incentivizes Timely Compliance With Final Wage Judgments SB 642 redefines “pay scale” as a good-faith estimate of the expected salary or hourly wage range, broadens the definition of “wages” to include total compensation such as bonuses and stock options, and extends the statute of limitations for pay discrimination claims to three years with a six-year lookback period.13Baker Law. 2026 Wage and Hour Nationwide Update SB 648 empowers the Labor Commissioner to investigate tip theft and issue citations, and AB 692 limits agreements requiring employees to repay training or relocation costs if they leave before a set period. California’s minimum wage rose to $16.90 per hour on January 1, 2026.31California Department of Industrial Relations. New Worker Protections Taking Effect in California on January 1, 2026
New York’s Trapped at Work Act, effective in 2026, prohibits most agreements requiring employees to repay training costs if they leave early, with fines and penalties for violations.13Baker Law. 2026 Wage and Hour Nationwide Update Pay transparency requirements keep spreading: Cleveland banned salary history inquiries for employers with 15 or more employees in October 2025, Delaware will require employers with more than 10 employees to disclose pay ranges in job postings starting September 2026 (with civil penalties up to $10,000), and Columbus will require salary ranges in postings starting January 2027.32Seyfarth Shaw LLP. Employment Law Horizon Report
Gig Economy: Classification Fights Continue
California gig workers remain classified as independent contractors under Proposition 22, which the state Supreme Court unanimously upheld in July 2024.10Lewis Brisbois. Rideshare Case Law Update A pending lawsuit, Rideshare Drivers United v. Uber, alleges the companies materially breached Prop 22’s requirements, which plaintiffs argue could cost them their contractor-classification protections.33LBAT Law. California Uber Lyft Misclassification Litigation 2026 Separately, the California Labor Commissioner’s wage theft lawsuit against Uber and Lyft, alleging willful misclassification of drivers from 2017 through December 2020, is in active discovery in San Francisco Superior Court, with trial anticipated in 2026.34California DIR. Lawsuits Against Uber and Lyft The Flowers Foods decision will add weight to similar fights in the delivery and logistics sector, where arbitration clauses have historically kept drivers out of court.
What These Cases Usually Allege
The underlying claims have stayed consistent even as dollar values have risen:
- Unpaid overtime, often because employers miscalculated the “regular rate of pay” by excluding shift differentials, non-discretionary bonuses, or commissions.
- Denied, shortened, or auto-deducted meal and rest breaks, especially in healthcare, hospitality, and retail.
- Off-the-clock work for pre-shift prep, post-shift cleanup, or security screenings. The $72.5 million Home Depot settlement for off-the-clock work and time rounding is a recent example.
- Worker misclassification, either labeling employees as independent contractors or classifying non-exempt workers as exempt. FedEx Ground’s cumulative payments of nearly $466 million over misclassification claims show the scale of exposure.
- Tip violations, including improper tip pools, manager participation in tips, or missing tip credit notices.
How Wage and Hour Class Actions Work
Two different vehicles carry these cases. A Rule 23 class action uses an “opt-out” mechanism: qualifying workers are included automatically unless they affirmatively exclude themselves. An FLSA collective action under 29 U.S.C. ยง 216(b) requires workers to “opt in” by filing written consent.21Jackson Lewis. Third Circuit Ruling Makes It Easier for Employers to Settle Hybrid Wage and Hour Actions Many cases are “hybrid” actions combining both.
After an investigation and the filing of a complaint, the court must certify the class, which requires showing the group is large enough that individual suits are impractical, that claims share common legal or factual questions, and that the lead plaintiff adequately represents the group. Once a class is certified, notices go out to potential members, who can join or opt out. If the case settles, a judge must hold a fairness hearing and approve the agreement as “fair, reasonable, and adequate” before any money is distributed.35Pond Lehocky. How Do Class Action Lawsuits Work for Wage and Hour Violations
What to Watch
The Providence Health case may reach the Washington Supreme Court, where a ruling on whether collective bargaining agreements can waive second meal periods would significantly affect healthcare and other unionized industries.9Washington Courts. Providence Health Petition for Review If the DOL’s proposed joint employer and independent contractor rules are finalized, they could redefine liability for franchisors and staffing companies nationwide.28DOL Wage and Hour Division. Joint Employer Status Under the FLSA, FMLA, and MSPA And the widening circuit split over personal jurisdiction in FLSA collectives continues to invite a future Supreme Court grant that could dramatically expand or contract the geographic reach of these cases.19Wage Hour Litigation. Second Circuit Restricts Nationwide FLSA Collective Actions