CST Brands Facing Large-Scale Lawsuit Over Overtime Pay

SAN ANTONIO -- CST Brands Inc. is facing potential legal woes now that a national law firm won approval of a collective action certification motion paving the way for managers and assistant managers at CST Brands' Corner Store locations to pursue their overtime claims as a group.

Sanford Heisler, with offices in New York, Washington, D.C., and San Francisco, sent a notice to more than 3,400 managers and assistant managers of Valero Energy Corp. and CST Brands, which was spun off on May 1.

The decision by arbitrator Michael Loeb requires that all current and former hourly managers of Valero's and CST's Corner Stores across the United States be notified of the certification and have an option to join the case. These individuals have 90 days to decide whether to join, beginning when the notice is mailed, according to the law firm.

"While we don't comment on the status of litigation, it is and always has been our policy to comply with all laws and regulations, including payment of wages and overtime. We value our employees and will continue to treat them fairly and in compliance with all laws," said Cindy Hill, general counsel for CST Brands Inc.

Janette Wipper, a partner at Sanford Heisler and lead counsel for the managers, views the notification as a crucial step toward remedying wage and hour violations by Valero and its successor against its Corner Store managers.

"We are pleased that the notification process has begun because it will inform all hourly Valero and CST Corner Store managers nationwide about their opportunity to participate in this case," said Wipper. "More importantly, collective action certification brings the Corner Store workers closer to securing the overtime wages withheld from them for many years while working long hours for Valero."

The federal Fair Labor Standards Act requires employers to pay time and a half in overtime wages for all hours worked above 40 in any week. In California, where Valero and CST operate almost 100 Corner Stores, state law requires employers to also pay overtime wages for all hours worked above eight in a day, according to the law firm.

"The [Corner Store] hourly managers routinely perform tasks off the clock before and after their shifts and during their breaks," said Chaya Mandelbaum, co-counsel in the case. "This is work the company requires and benefits from, but doesn't pay for. We are hopeful that the collective action will bring these illegal employment practices to an end."

According to Sanford Heisler, Corner Store managers reported having to conduct surveys of competitors' gas prices before and after their shifts and tending to issues at their stores over the phone during non-work hours, as well as being required to conduct surveillance of store employees off the clock, and having to finish tasks at the store while not clocked in to avoid running afoul of the companies' rigid labor budget and overtime requirements.

The managers also reported that the companies do not factor in federally required payments such as shift differentials in determining managers' compensation.

"We expect that large numbers of the Valero hourly managers across the country will identify with the experiences of their colleagues in other locations and will elect to join the case," Wipper added.