Two major Alaskan seafood processors have agreed to settle a class-action lawsuit alleging wage violations during the COVID-19 pandemic.
OBI Seafoods and Ocean Beauty Seafoods were ordered to pay a total of $2.1 million as part of a settlement approved last week by Judge Marsha J. Pechman in the U.S. District Court for the Western District of Washington.
The case, brought by former employees Marija and Dusan Paunovic on behalf of processing facility workers, accused the companies of delaying wage payments and underpaying workers during mandatory quarantine periods.
OBI has 10 facilities in the state and was formed in 2020 through a merger between Ocean Beauty and former Alaskan processor Icicle Seafoods. Ocean Beauty currently owns a stake in the company as part of the new ownership group.
In email correspondence with KDLG, OBI’s chief executive officer John Hanrahan said that all workers at the company’s processing facility in Naknek were paid a daily stipend during the quarantine period, and were provided with free housing, meals, and laundry services.
“OBI Seafoods values its employees, pays competitive wages, and complies with all federal, state, and local wage laws and regulations,” Hanrahan said.
The plaintiffs, however, contended that the stipend was insufficient for extended quarantine periods. They argued the companies failed to adequately compensate employees for time spent in isolation as required by Alaska’s Wage and Hour Act and the federal Fair Labor Standards Act.
As part of the settlement, each of the more than 2,300 class members will receive $536, with some payouts exceeding $3,100, after deductions for legal fees and administrative costs.
The agreement also includes $630,000 in attorney fees, $100,000 for litigation costs, and $20,000 in service awards for the two lead plaintiffs. Administrative costs of up to $32,000 will be deducted from the settlement fund. The remainder will be distributed pro rata based on workers’ quarantine periods and delayed wages.
According to court documents, the settlement financially covers roughly three-quarters of the damages cited by the lawsuit's class members. A court website contains more information about the settlement for class members, as well as options to opt out of it.