What Was Kenneth Cole Thinking?
In the end, Kenneth Cole failed to use good business judgment in resolving this wage claim. While it may have been worthwhile to dispute Murphy’s claim before the Labor Commissioner in the hope that an award might be denied or minimized, it was a poor decision to appeal. Kenneth Cole failed to first analyze whether its store manager was properly classified as an exempt employee, as discussed above. Presumably, if Kenneth Cole had done so, it would have reasonably concluded that he was not exempt from California wage orders and let the matter rest. Further, once Kenneth Cole appealed the Labor Commissioner’s award, it triggered Murphy to do what many employees do. He sought the assistance of legal counsel and the scope of the inquiry grew exponentially. In the end, Kenneth Cole exposed itself to an award that was more than double the Labor Commissioner’s original amount, and became subject to a substantial award of attorneys’ fees (that multiplied at each level of appeal), only adding m
