What Workspace Operators can Learn from WeWork’s Ex-Employee Lawsuit

Image via WeWork / wework.com

Late last year, the coworking giant WeWork was sued by an ex-employee for unpaid overtime, wrongful termination, and retaliation.

According to this Buzzfeed article, the problems arose when Zoumer (WeWork ex-community manager) voiced her concerns to colleagues about being wrongly classified as employees.

Zoumer’s complaint alleges that in early October 2015, she began speaking with other members of WeWork’s community team about the possibility that they were wrongly classified and entitled to overtime wages, as well as reimbursement for cell phone expenses.”  – March 10, 2016  Buzzfeed

Though the lawsuit is still to be settled, it raises an important issue for flexible workspace operators all around the world: How should community managers be paid? Are they eligible for overtime? What should their employee classification be?

Community managers are key to the success of any flexible workspace. They’re the ones running the space, the ones that know the members, the ones organizing events, the ones making sure that everyone is happy.

A true Community Manager enhances the connections and interactions of the coworker to bring them value and to actively accelerate serendipity. (…) It’s a job that requires constant dedication and commitment in order to create and drive the right interactions that form a strong sense of community.” – Susan Smith, OfficingToday

It’s no light responsibility that often entails long working hours. Which brings us to the current issue at hand.

Outside of their regular working hours, various community managers (if not all) are responsible for organizing and hosting several events and activities in a given workspace. Granted, these can take place at any time during the day, but often, they take place in the late-afternoon, evening, weekends, and even lunch-time.

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It’s no surprise then that many community managers end up working overtime. So, in the midst of all the long-hours and responsibilities, the question becomes of when should community managers be paid overtime, and whether they are eligible for it.

Laws and regulations vary by country and by state, but standard working hours fall between 40-48 hours per week in most countries. Any time worked over that is eligible to count as overtime, except for exempt employees whose contracts clearly state they they are not entitled to overtime. These employees tend to be those who have a yearly set salary and fulfill particular conditions.

In Zoumer’s case, her complaint states that she was working an average of 50-60 hours per week. WeWork’s defense for not paying overtime is that Zoumer fell under the administrative exemption (Buzzfeed article). This might appear to be a misinformation case, but fact remains that more often than not, workers aren’t fully aware of their rights and  employee classification, which leads to situations like this one.

So, how can operators and employees avoid this? Is there a fireproof solution?

Not necessarily. Payment schemes and models depend greatly on the labor laws of any given country or state. Regardless of whether your community manager (or any other employee)  is paid hourly or is  salaried, the contract must clearly state the responsibilities along with all types of compensations they’re eligible for. And if not eligible, make sure that they are fully aware of this in order to prevent allegations and claims from dampening your workspace and name.  You should also consider including clauses that address which issues should be settled through arbitration process instead of litigation.

In short, it’s about clearly stating what you expect from employees and what they can expect back from you. But WeWork’s situation should be a lesson to all; if your community managers work long hours, make sure they fully understand the terms and conditions of their contracts.