In Ko v. K Stones, Inc. et al, a federal court ruled on a dispute involving a salaried employee who was denied overtime pay over several years. Joong Ko worked for a family-run beauty supply business in Oak Park, Illinois, from 2012 to 2018. Though his weekly pay was fixed at $600, Ko consistently worked over 40 hours per week performing non-exempt labor including sales, inventory, maintenance, and even political support work for the owner. Despite his long hours, Ko was never paid overtime wages.
Ko filed a lawsuit under the Fair Labor Standards Act (FLSA) and the Illinois Minimum Wage Law (IMWL), arguing that the employer had misclassified him and failed to keep proper time records. While the defendants admitted they did not pay Ko overtime and believed he was exempt due to his salaried status, the court found that Ko performed non-exempt duties and was legally entitled to overtime compensation.
The court granted summary judgment in Ko’s favor regarding the employer’s liability for wage violations but denied summary judgment on damages, citing factual disputes about hours worked, lunch breaks, and inconsistencies in both the employee’s handwritten records and the employer’s notebook entries. The court also declined to rule on whether the violation was willful, leaving that question for a jury to decide.
Lessons Learned from the Case:
- Salary alone does not determine exemption status. Even if an employee is paid a flat weekly or annual salary, employers must assess whether the job duties qualify under FLSA exemption rules.
- Misclassification is a legal risk. Assuming a salaried employee is exempt without verifying their duties can result in wage violations and financial liability.
- Inadequate timekeeping increases exposure. Employers who fail to maintain accurate records shift the burden of proof to themselves and weaken their legal defense.
- Damages often hinge on details. Even when liability is established, disputes over hours worked, break times, and compensation records can delay resolution and increase costs.
If you want to know more about salaried employee rights, read our guide on What are my rights as a salaried employee in Illinois?
