A federal judge has approved a $1.1 million settlement resolving a class of customer service representatives' claims against their health care company employer over allegations of unpaid overtime and back wages.

U.S. District Judge Gene E.K. Pratter of the Eastern District of Pennsylvania approved the settlement of named plaintiff Gwendolyn Hall's claims against Accolade Inc. Of the $1.1 million, $363,000 (33%) was set aside for attorney fees.

Accolade, which assists employers and insurance companies in administering benefits, employed the class members to handle calls with its customers. Hall claimed that the company misidentified its call center employees, known as "health assistants," as overtime exempt.

She sued for back pay consisting of unpaid overtime for the 15 minutes each day that employees spent logging into the company's computer systems, Pratter said in her opinion. The settlement was reached early on in the litigation.

Pratter said 45 class members who worked for Accolade in Pennsylvania opted into the Fair Labor Standards Act litigation. She concluded that the relief agreed upon by the parties was adequate to the plaintiffs.

"Proposed class counsel asserts that here, absent settlement, the parties would likely have incurred significant additional costs, including motion practice regarding (1) certifying the FLSA collective action, (2) certifying the Rule 23 class action, and (3) summary judgment," Pratter said. "Counsel also states that although Ms. Hall already constructed a damages model using an expert witness, she would likely have hired an additional damages expert for presentation purposes. Finally, counsel explains at length the parties' litigation risks, including (1) risks created by the FLSA's multiple statutes of limitations (depending on establishing whether Accolade acted 'willfully'), (2) whether the unpaid hours claim is cognizable, because it requires establishing that logging into a computer is compensable time, (3) whether the misrepresentation claim is cognizable, because there is an argument that the administrative exemption to overtime could have applied to health assistants prior to 2016, and (4) that the overtime hours actually worked by many class members could be less than the pro rata distribution available to settlement participants."

Pratter also held that the class met the requirements for numerosity, commonality, typicality, adequacy of representation and predominance of issues, enabling the judge to grant class certification in addition to settlement approval.

The class members are represented by Peter Winebrake of Winebrake & Santillo in Dresher.

"We are pleased that the court has preliminarily approved the settlement. Also, I think Judge Pratter's memorandum is noteworthy because it explains that the December 2018 amendments to Federal Rule of Civil Procedure 23(e) dictate the preliminary approval analysis," Winebrake said in an email. "Previously, the criteria for evaluating class action settlements was dictated by caselaw and differed from circuit to circuit. The December 2018 amendments change all that and bring uniformity to the process. But old habits die hard. So, in my view, it is important for courts to issue thoughtful opinions analyzing class settlements under the amended rule."

Accolade is represented by Christopher J. Moran of Pepper Hamilton in Philadelphia, who did not respond to a request for comment.