What specific wage and hour laws were at issue in the Faiz Ahmed case against Budget?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
ember 2, 2022 for $20,000 and the case was closed on December 14, 2022.
Faiz Ahmed, d/b/a Premium Autos, LLC and Ahsan Syed, d/b/a ARS, Inc. v. Avis Rent A Car System, Inc., a Delaware Corporation, Budget Rent A Car System, Inc., a Delaware Corporation, Avis Budget Group, Inc., a Delaware Corporation and DOES 1-100, Inclusive (Superior Court for the State of California for the District of Rancho Cucamonga, County of San Bernardino, Case No. CIVRS 1308871). On December 31, 2013, plaintiffs, agency operators of Avis and Budget, filed a complaint against Avis, Budget, and ABG, seeking relief under California's wage and hour laws to remedy the alleged misclassification of agency operators as independent contractors rather than classifying each of the Plaintiffs as employees. The parties reached a settlement at Mediation in November, 2018. The parties entered into settlement agreements in December 2018 where a total settlement of $1,758,000 (Ahmed: $500,000, Syed: $500,000, Huseinbhai: $250,000, and Sansone: $250,000) was paid to the tru
Source: Item 3 — LITIGATION (FDD pages 12–16)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the Faiz Ahmed case, filed on December 31, 2013, involved claims related to California's wage and hour laws. The plaintiffs, who were agency operators for both Avis and Budget, sought relief due to the alleged misclassification of agency operators as independent contractors instead of employees.
This type of legal action is significant for prospective Budget franchisees because it highlights potential risks associated with how they classify and compensate their workers. Misclassifying employees as independent contractors can lead to legal and financial repercussions, including back wages, penalties, and legal fees.
The case was settled at mediation in November 2018, with settlement agreements finalized in December 2018. A total of $1,758,000 was paid to the trust account of LA Superlawyers, Inc. on behalf of the plaintiffs, with Faiz Ahmed receiving $500,000. This outcome underscores the importance of Budget franchisees adhering to labor laws and correctly classifying their workers to avoid similar costly legal disputes. Franchisees should consult with legal and HR professionals to ensure compliance with all applicable wage and hour regulations.