$65.5M Settlement Resolves Au Pair Wage Suppression Class Action

A $65.5 million settlement has been reached to resolve claims that sponsorship agencies for au pair workers conspired together to suppress wages.

Under the au pair settlement, a Class estimated to include nearly 100,000 members will be eligible to receive a portion of the $65.5 million settlement.

The amount each Class Member will be able to collect from the au pair settlement fund will depend on the type of claim they made against the sponsorship agencies.

Aside from monetary compensation, the au pair class action settlement will also require the sponsorship agencies to send communications to host families and make changes to their websites to inform the relevant parties that au pair workers are able to enter negotiations regarding their pay, allowing them to seek compensation higher than minimum wage.

Class counsel reportedly plans to ask for up to 35 percent of the au pair settlement to compensate them for attorneys’ fees, in addition to an undetermined amount in court costs.

“The parties agree that the terms of the settlement were negotiated at arm’s length, in good faith by the parties, and reflect a settlement that was reached voluntarily based upon adequate information and after consultation with experienced legal counsel,” the au pair class action settlement states.

Au pairs who brought the class action lawsuit received visas under a “cultural exchange” program where young individuals visiting the U.S. can stay with a host family in exchange for childcare services.

Sponsorship companies are authorized by the J-1 visa program to organize visas for au pairs, but allegedly suppressed au pair wages – prompting an au pair class action lawsuit in 2014.

The au pair plaintiffs claimed that the sponsorship companies fixed wages at only $4 an hour for 45 hour work weeks.

The au pair class action lawsuit brought claims against the companies under the Fair Labor Standards Act (FLSA), the Racketeer Influenced and Corrupt Organizations (RICO) Act, the Sherman Act, and state laws.

In February 2018, U.S. District Judge Christine M. Arguello certified two Classes and 16 subclasses of more than 91,000 au pairs under RICO, the Sherman Act, and state laws. These Class certifications joined 11 Classes and subclasses which were certified by the judge in June 2017 under FLSA.

By settling the au pair class action lawsuit, defendants do not admit any wrongdoing. Instead, settlements provide an opportunity for all parties to resolve claims without the risk and costs associated with continuing litigation.

“We’re pleased that our years of hard work will bring justice to so many young childcare workers and fundamentally change the way the au pair industry operates,” class counsel said in a statement, according to Law360.

Plaintiffs are represented by Matthew L. Schwartz, Sean P. Rodriguez, Peter M. Skinner, Dawn L. Smalls, Joshua J. Libling, Byron Pacheco and Juan P. Valdivieso of Boies Schiller Flexner LLP and Alexander Hood of Towards Justice.

The Au Pair Wage Suppression Class Action Lawsuit is Beltran, et al. v. InterExchange Inc., et al., Case No. 1:14-­cv-­03074, in the U.S. District Court for the District of Colorado.

UPDATE: February 2019, the au pair wage suppression class action settlement is now open. Click here to file a claim.