Tentative settlement reached in home internet expense reimbursement dispute

A tentative settlement has been reached in a lawsuit filed against a game technology studio by an employee who alleges that she and other workers are wrongfully being denied reimbursement for personal internet expenses for work done at home.

Meghan O’Sullivan’s proposed Los Angeles Superior Court class-action lawsuit against Mythical Games states that she and her co-workers have been ordered to work from their residences for more than two years rather than come in to the company’s Sherman Oaks office, where the company develops video games and platforms. O’Sullivan was hired in November 2021 as an executive assistant.

Attorneys in the case filed a status report on Monday with Judge Carolyn B. Kuhl informing of the tentative accord, stating that they expect the only upcoming motion to be one asking for its preliminary approval. No terms were divulged.

The parties negotiated for several weeks and are now working to complete a written settlement agreement, according to the attorneys’ court papers. The lawyers are requesting a hearing within 75 to 90 days. A Dec. 20 hearing is currently on calendar.

The suit was brought Aug. 12 under the state’s Private Attorneys General Act, which authorizes allegedly aggrieved employees to file lawsuits to recover civil penalties on behalf of themselves, other employees and the state of for purported Labor Code violations.

“To be clear, Mythical sent home all of their employees, including plaintiff, during the period from around March 13, 2020, to the present, to conduct their work from home, and did so without affirmatively reimbursing them with monthly stipends or otherwise for a reasonable portion of their monthly home internet expenses,” the suit states. “To the contrary, Mythical advised that home internet expenses were not reimbursable despite the fact that employees needed to use their home internet to do their jobs.”

The suit does not state why Mythical employees were told to work from home, but March 2020 was the start of the closure of many in-person business operations due to coronavirus safety concerns.

According to Mythical Games’ travel and entertainment policy, expenses relating to the internet, cable and wireless services at employees’ homes are typically not reimbursable and are issued on a case-by-case basis, the suit states.

Mythical Games’ chief people officer, Cassandra Kaiser, explained in an email to employees that the company does not provide compensation for internet expenses “given (that) most employees would already have internet as a part of their daily lives and additionally most employees are no longer incurring the costs to commute,” the suit states.

But the suits states that under California law, employers must reimburse a reasonable percentage of employees’ expenses in such cases as O’Sullivan’s, even if their workers have unlimited data plans and have incurred no increase in costs.

O’Sullivan seeks to represent a class comprised of her and all other California residents who are or were employed by Mythical and who worked from home for at least one pay period at any point from March 13, 2020, to the present, with a few limited exceptions, such as those working in human resources.

Eligible employees are each entitled to at least $50 a month in expenses dating back to March 2020, the suit states.