Smoothstack class action lawsuit overview:
- Who: Plaintiff Justin O’Brien filed a lawsuit against Smoothstack Inc.
- Why: Smoothstack workers are allegedly required to sign an agreement stating they must pay $24,000 if they leave the company or fail to meet billable hour requirements.
- Where: The Smoothstack class action lawsuit was filed in Virginia federal court.
Smoothstack workers allege they experience unpaid or underpaid training before being subjected to a $24,000 penalty for failing to meet the company’s billable hours requirement.
Plaintiff Justin O’Brien filed the Smoothstack lawsuit April 13 seeking to invalidate this allegedly unconscionable and unenforceable liquidated damages provision and recover unpaid wages and damages under the Fair Labor Standards Act.
Smoothstack workers are required to attend a six-month intensive training program focused on programming and IT skills, the class action claims. Although the company says it offers pay and full benefits for training, the lawsuit claims it fails to compensate employees for the first three weeks of the training program.
For the remaining five weeks of the program, Smoothstack workers allegedly work extremely demanding hours, sometimes up to 80 hours per week, yet the company only pays them up to 40 hours per week, according to the class action lawsuit.
“Smoothstack boasts that its training program has just an 8% completion rate on its website to clients, as if that number is competitive because of high-quality training,” the class action says. “In reality, recruits are overworked and underpaid for a subpar training program.
Smoothstack workers ‘trapped’ in jobs, class action alleges
After hiring, Smoothstack workers are allegedly required to sign a Training Repayment Agreement Provision (TRAP), obligating them to bill 4,000 hours of client work (about two years of full-time employment) before they can resign from the company.
Smoothstack workers who resign before meeting the billable hour requirement must pay an “outrageous penalty” of $23,875 or more, essentially trapping them in their jobs, the class action alleges.
O’Brien says he applied for a job with Smoothstack in 2020 after seeing advertising touting starting pay at $55,000 per year and believed it would be a good career move. He says he felt he had no choice but to accept the TRAP and employment agreement with the steep penalties.
When he attempted to resolve his concerns with the company, O’Brien says Smoothstack retaliated against him.
O’Brien filed the Smoothstack lawsuit on behalf of himself and a proposed class of other Smoothstack workers who participated in the training program and/or signed TRAPs since April 13, 2020.
Do you think Smoothstack workers who fail to meet billable hour requirements should be penalized financially? Tell us your thoughts in the comments.
O’Brien is represented by Molly Elkin and Rachel Lerner of McGillivary Steele & Elkin LLP; Rachel W. Dempsey and David Seligman of Towards Justice; Jahan C. Sagafi, Hannah Cole-Chu and Courtney J. Hinkle of Outten & Golden LLP; and Persis Yu and Khandice Lofton of Student Borrower Protection Center.
The Smoothstack workers class action lawsuit is Justin O’Brien v. Smoothstack Inc., Case No. 1:23-cv-00491, in the U.S. District Court for the Eastern District of Virginia, Alexandria Division.
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