Will Volunteer … For Minimum Wage? Saint Louis University Law Professor sues Competitor Group, Inc. for Minimum Wages

Oct 21, 2014

If you’ve participated in a 5k, 10k, half or full marathon, you know that, in addition to race participants, tons of people volunteer their time to pass out water to participants, block traffic from the race course, provide minor first-aid, pick up trash, and escort world-class racers to personal best times. In a lawsuit she filed on Sept. 23, 2014 in the U.S. District Court for the Eastern District of Missouri on behalf of herself and those similarly situated, Yvette Liebesman alleges that as a “volunteer” for the St. Louis Rock ‘n Roll Marathon, she was actually providing “free labor” to the race’s operator, Competitor Group, Inc.

Liebesman, a Saint Louis University law professor, complains that Competitor Group, Inc. falsely led her and other volunteers to believe they were volunteering on behalf of the race’s charities. In reality, however, she alleges Competitor Group, Inc., a for-profit corporation, requires charities to pay the corporation to be an “affiliated” charity of the Rock ‘n Roll Marathon. Liebesman claims Competitor Group, Inc. owes her and other volunteers unpaid minimum wages under the Fair Labor Standards Act (“FLSA”) and specific state minimum wage laws, and that Competitor Group, Inc. was unjustly enriched by retaining labor for which it did not pay. Moreover, Liebesman claims Competitor Group, Inc. committed fraud by intentionally misleading volunteers to believe they were volunteering “for charity,” when it actually retained a profit. Liebesman seeks unpaid minimum wages, liquidated damages, attorney’s fees and costs, and other unspecified damages as allowed under state law.

The FLSA requires employers to pay minimum wage to employees for all hours worked. However, the FLSA exempts non-profit organizations from paying volunteers who donate services (usually on a part-time basis) performed without contemplation of pay. Many of the state laws raised in Liebesman’s Complaint have similar exemptions. Undoubtedly, the outcome of this case will affect not only organizations that produce charity-based races, but all organizations utilizing volunteers. Many hospitals, educational institutions, and other organizations rely heavily on the work of their dedicated volunteers. Should the Court determine Liebesman and her class are due minimum wages, it could affect the way all other organizations treat volunteers. Consequently, it would behoove volunteer-based non-profit organizations to review their classification of volunteers to ensure they are compliant with the FLSA and relevant state laws.

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