BJ's Wholesale Club Settles Job Classification Claim - Update

Wednesday, warehouse clubs operator BJ's Wholesale Club (BJ) said it has recorded $11.7 million pre-tax charge in settlement of a claim related to the classification of various employees as exempt from overtime wages.

The exact number of employees who will receive compensation and the amount of each settlement will be disclosed only after the court proceeds with final approval of the settlement and all employee claims are submitted.

BJ's statement came immediately after Klafter Olsen & Lesser LLP filed an overtime pay class action lawsuit for a settlement of $9.3 million.

Klafter Olsen & Lesser claimed that BJ's misclassified certain Mid Manager employees as exempt from receiving overtime for hours worked in excess of 40 hours per week.

Under the settlement, approximately 1,500 current and former Mid Managers employed by BJ's since November 2007 will be entitled to receive payments to compensate for particular hours worked in prior years.

Sue Hoffman, senior vice president and chief personnel officer said, "BJ's Wholesale Club values the role each team member plays in serving our Members and helping our Company succeed and grow."

The Natick, Massachusetts based company currently operates 186 clubs and 104 gas stations in 15 eastern states in the United States

Earlier today, the company reported 37.4% drop in third quarter profit despite an increase in revenue. BJ's net income for the quarter was $17.67 million or $0.32 per share, down from $28.24 million or $0.48 per share in the prior-year quarter. Revenue for the quarter improved to $2.51 billion from $2.46 billion in the same quarter last year.

BJ's is currently trading at $35.09, down $1.25 or 3.44%, on the NYSE

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