Anthony Marin worked as an hourly employee of Costco Wholesale Corporation for almost 15 years. Marin sued Costco for alleged Labor Code violations and unfair business practices. Marin argued that Costco’s calculation of vertime pay in its bonus plan for hourly employees violated state and federal law.
Costco paid a formulaic bonus, based on paid hours, to long-term hourly employees. To be eligible for the bonus, paid in April and October, these employees had to: (1) have been paid a specified number of hours for continuous service-8,000 hours (approximately four years) for those hired before March 15, 2004, and 9,200 hours (approximately 4.6 years) for those hired after that date; (2) generally be at the top of their pay scale; and (3) have been employed by defendant on April 1 for the April bonus and October 1 for the October bonus. The maximum semi-annual base bonus amount was $2,000 for those with less than 10 years of service, $2,500 for those with 10 to 14 years of service, $3,000 for those with 15 to 19 years of service, and $3,500 for those with 20 or more years of service.
