Allstate Facing Employee Lawsuit Over Allegedly Unpaid Wages Following Kronos Data Breach

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A proposed collective action claims that The Allstate Corporation has failed to properly pay employees in the wake of a December 2021 data breach that hampered its timekeeping system.

The 12-page lawsuit alleges that Allstate could have used any number of ways to accurately keep track of employees’ hours and pay them at the correct rates following the Kronos data breach but instead “chose not to do that.”

Instead, Allstate paid workers based on their scheduled or estimated hours, or “simply duplicated paychecks” from prior pay periods, the suit alleges. In many cases, employees were paid for fewer hours than they actually worked and were denied proper overtime wages when they worked more than 40 hours in a week, according to the case.

“In other words,” the complaint states, “Allstate pushed the effects of the Kronos hack onto the backs of its most economically vulnerable workers, making sure that it kept the money it owed to those employees in its own pockets, rather than take steps to make sure its employees were paid on time and in full for the work they did.”

The plaintiff in the case claims to be “one of thousands of employees” who was paid inaccurately after Allstate’s third-party timekeeping system provider, Kronos, fell victim to a ransomware attack on December 11, 2021, and became inoperable.

According to the suit, Allstate paid the plaintiff and other employees “based upon arbitrary considerations” other than their actual hours worked.

The plaintiff says that although she was paid for “portions of the overtime she worked,” her overtime wage rate did not take into account shift differentials or non-discretionary bonuses. Per the case, Allstate was well aware that its workers’ overtime wages should have been paid at a rate of 1.5 times their regular pay rates, including shift differentials, bonuses and “other factors allowed under the law,” yet failed to pay employees their full overtime premiums.

The lawsuit alleges Allstate has violated the federal Fair Labor Standards Act.

The plaintiff looks to represent all current or former non-exempt employees of Allstate or its subsidiaries or alter egos who worked in the U.S. at any time since the onset of the Kronos ransomware attack around December 11, 2021 to the present.

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