Watermark Services IV $2.5M Class Action Settlement

Employees who worked as an hourly, nonexempt employee for Watermark Services IV LLC, d/b/a Watermark Retirement Communities, in California between June 1, 2022, and March 31, 2025, may be eligible to claim a cash payment from a class action settlement.

Watermark Services IV LLC agreed to pay $2.5 million to resolve a lawsuit alleging violations of California labor laws, including unpaid overtime, missed meal and rest breaks, unreimbursed business expenses and untimely wage payments. This settlement also addresses claims for penalties under the California Private Attorneys General Act.

Who are the class members?

Class members must meet the following criteria:

• They worked for Watermark Services IV LLC in California.
• Watermark classified them as an hourly, nonexempt employee.
• Watermark employed them at any time during the class period, which is June 1, 2022, to March 31, 2025.

The settlement covers two main groups:

• Class members: These individuals are eligible for individual class payments if they do not opt out of the settlement.
• Aggrieved employees: These are individuals who worked for Watermark Services IV LLC in California as hourly, nonexempt employees during the PAGA period (June 6, 2022, to March 31, 2025). Aggrieved employees are eligible for individual PAGA payments regardless of whether they opt out of the class settlement.

The settlement administrator determines each class member’s eligibility and payment amount by the company’s records, which specify the number of workweeks and pay periods credited to each individual. The notice sent to each class member includes this information.

How much can class members get?

The total settlement fund is $2,500,000. After court-approved deductions for attorneys’ fees, litigation expenses, service awards, settlement administration costs and PAGA penalties, the settlement administrator will distribute the remaining balance (the net settlement amount) to participating class members based on the number of weeks they worked during the class period.

The calculation for individual class payments is as follows:

• The settlement administrator will divide the net settlement amount by the total number of workweeks all participating class members worked to determine a per-workweek payment.
• It calculates each class member’s payment by multiplying the per-workweek amount by the number of weeks they worked.

The calculation for PAGA payments is as follows:

• The settlement sets $31,250 aside for individual PAGA payments.
• The settlement administrator will divide this amount by the total number of PAGA pay periods all aggrieved employees worked.
• Each aggrieved employee then receives a payment based on their number of PAGA pay periods.

Class member payments are subject to tax allocations:

• 20% of each individual class payment is considered wages (reported on IRS W-2 and subject to withholding)
• 80% is considered penalties (reported on IRS 1099)
• It treats individual PAGA payments as penalties and reports them on IRS 1099.

No action needed to receive payment

Class members do not need to file a claim to receive payment. They will automatically receive a check by mail at the address on file. If a class member's address changes, they should notify the settlement administrator as soon as possible to ensure they receive payment.

Additionally, those who wish to dispute the number of workweeks or PAGA pay periods credited to them may prepare a signed letter stating their dispute and mail copies of supporting documentation, such as pay stubs or other records, to the settlement administrator. The dispute deadline is May 8, 2026.

Settlement administrator’s mailing address: Harris, et al. v. Watermark Services IV LLC, c/o Settlement Administrator, P.O. Box 26170, Santa Ana, CA 92799

Class members who wish to opt out of the class settlement (and thus not receive an individual class payment) must send a written and signed request to the settlement administrator by May 8, 2026. They cannot opt out of the PAGA portion of the settlement.

Payout options

• Paper check via U.S. mail to the address on file

$2.5 million settlement fund breakdown

The $2,500,000 settlement fund includes:

• Settlement administration costs: Up to $20,000
• Attorneys’ fees: Up to $833,333.33
• Attorneys’ expenses: Up to $62,000
• Service awards to class representatives: Up to $10,000 each
• PAGA penalties: $125,000 (75% to the California Labor and Workforce Development Agency and 25% to aggrieved employees)
• Payments to eligible class members: The remainder of the fund

Important dates

• Opt-out deadline: May 8, 2026
• Dispute deadline: May 8, 2026
• Final approval hearing: July 14, 2026

When is the Harris, et al. v. Watermark Services IV LLC payout date?

The settlement administrator will mail payments to class members approximately 44 days after the court grants final approval and the settlement becomes final.

Why did this class action settlement happen?

The class action lawsuit alleged Watermark Services IV LLC violated California labor laws by failing to pay overtime, provide meal and rest breaks, reimburse business expenses, provide accurate wage statements and pay all wages owed during and at the end of employment.

Both sides agreed to settle to avoid the risks and costs of continued litigation. The company does not admit any wrongdoing as part of the settlement.

Sources

1. Settlement agreement
2. Settlement FAQ
3. Important dates