Corner Store Embroiled in Class-Action Overtime Case

Lawsuit names both Valero, CST Brands as defendants

CST Brands

SAN ANTONIO -- More than 3,400 Valero Corner Store managers and assistant managers have been allowed to join a lawsuit seeking compensation for hours some allege they were required to work off the clock, reported The San Antonio Business Journal.

The lawsuit, brought by the San Francisco law firm Sanford Heisler LLP on behalf of three hourly paid California managers, received collective-action certification recently from arbitrator Michael Loeb.

The case names both Valero Energy Corp. and CST Brands Inc.--the retail operations the San Antonio-based refiner spun off this spring--as defendants in the case, filed in U.S. District Court for the Northern District of California and subsequently referred to arbitration.

"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," Cindy Hill, general counsel for CST Brands, said in a statement provided to CSP Daily News.

The original suit, filed in 2009, alleges that Corner Store managers and assistant managers are expected to do surveys of competitors' gasoline prices and conduct surveillance of employees when they are not on duty. The workers also alleged that they had to finish tasks at the store while not clocked in to avoid running afoul of the companies' rigid labor budget and overtime requirements, and that the company does not factor in federally required payments such as shift differentials in determining managers' compensation.

Current and former managers who worked any time since Feb. 10, 2008, could be eligible, said the report.

Sanford Heisler, which recently won approval of a collective action certification motion paving the way for them to pursue their overtime claims as a group, said in a statement that notices have been mailed to more than 3,400 managers and assistant managers of Valero and CST nationwide.

The decision by Loeb requires that all current and former hourly managers of Valero's and CST's Corner Stores 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.

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.

"The 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."

"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," said Janette Wipper, a partner at Sanford Heisler and lead counsel for the managers.

San Antonio-based Valero Energy Corp., through its subsidiaries, is an international manufacturer and marketer of transportation fuels, other petrochemical products and power. Valero subsidiaries employ approximately 10,500 people, and assets include 16 petroleum refineries with a combined throughput capacity of approximately 3 million barrels per day, 10 ethanol plants with a combined production capacity of 1.2 billion gallons per year, a 50-megawatt wind farm, and renewable diesel production from a joint venture. More than 7,300 outlets carry the Valero, Diamond Shamrock, Shamrock and Beacon brands in the United States and the Caribbean; Ultramar in Canada; and Texaco in the United Kingdom and Ireland. On May 1, Valero Energy Corp. spun off CST Brands--and its Corner Store retail brand--as a separate company.

CST Brands Inc. is one of the largest independent retailers of motor fuels and convenience merchandise in North America. Based in San Antonio, it employs nearly 12,000 team members at nearly 1,900 locations throughout the southwestern United States and eastern Canada offering a variety of convenience merchandise, beverages, snacks and fresh food.

In the United States, CST Corner Stores sell Valero fuels and signature products such as Fresh Choices baked and packaged goods, U Force energy and sport drinks, Cibolo Mountain coffee, FC Soda and Flavors2Go fountain drinks. In Canada, CST is the exclusive provider of Ultramar fuel and its Depanneur du Coin and Corner Stores sell signature Transit Cafe coffee and pastries.