Watermark Retirement Communities $2.5M Wage Settlement, California Workers Get Automatic Payment

Watermark Services IV LLC — the company behind Watermark Retirement Communities — agreed to pay $2.5 million to settle a class action lawsuit alleging it violated California labor laws by failing to pay overtime, denying proper meal and rest breaks, and withholding other wages owed to hourly workers. If you worked as an hourly, nonexempt employee at Watermark Retirement Communities in California between June 1, 2022, and March 31, 2025, you may qualify for an automatic cash payment — no claim form required. The dispute and opt-out deadline is May 8, 2026.

Quick Facts

Current Status and What Happens Next

• Preliminarily approved — the court has given conditional approval and Simpluris is identifying all eligible class members using Watermark’s payroll records.
• Dispute and opt-out deadline: May 8, 2026 — if you believe your workweek count is wrong, you must mail a signed dispute letter with supporting documentation by this date. Workers who want to opt out of the class settlement must also act by May 8, 2026.
• Final approval hearing: July 14, 2026 — if the court grants final approval, the settlement administrator will mail checks to all eligible class members approximately 44 days after the settlement becomes final.

What Is the Watermark Retirement Communities Lawsuit About?

Plaintiff Harris and other hourly workers filed the class action lawsuit Harris, et al. v. Watermark Services IV LLC, Case No. 23CV035212, against Watermark Services IV LLC — doing business as Watermark Retirement Communities — a national operator of senior living communities offering independent living, assisted living, memory care, and skilled nursing care services. The lawsuit alleged Watermark repeatedly violated California labor law across its California communities by denying workers the wages and breaks they were legally entitled to.

California has some of the strongest worker protections in the country. The lawsuit alleged Watermark violated multiple provisions of the California Labor Code — including failing to pay all overtime wages earned, failing to provide legally required 30-minute uninterrupted meal breaks and 10-minute rest breaks, failing to reimburse employees for business-related expenses, failing to provide accurate wage statements, and failing to pay all wages owed at the time of termination. The lawsuit also included claims under the California Private Attorneys General Act (PAGA) — a law that allows employees to sue on behalf of the state for labor code violations, with penalties shared between the state and affected workers.

Watermark Services IV LLC denies any wrongdoing. The company agreed to the $2.5 million settlement to avoid the cost and uncertainty of continued litigation.

Who Is Eligible to Receive a Payment?

The settlement covers two groups of Watermark employees. Your notice specifies which group you belong to and how many workweeks or pay periods are credited to your account.

Group 1 — Class Members (Individual Class Payment):

• You qualify if you worked for Watermark Services IV LLC in California as an hourly, nonexempt employee at any time between June 1, 2022, and March 31, 2025.
• You will automatically receive a class payment unless you opt out before May 8, 2026.
• Opting out means you give up your class payment but preserve your right to sue Watermark independently for wage violations.

Group 2 — Aggrieved Employees (PAGA Payment):

• You qualify if you worked for Watermark Services IV LLC in California as an hourly, nonexempt employee at any time during the PAGA period: June 6, 2022, through March 31, 2025.
• You receive a PAGA payment regardless of whether you opt out of the class settlement — you cannot opt out of the PAGA portion.
• The PAGA payment is separate from and in addition to any class payment you receive.

How Much Can You Receive?

Your individual payment depends on how many weeks you worked at Watermark during the class period. Workers with more workweeks receive a proportionally larger share.

Class Payment Calculation:

The settlement administrator divides the net settlement amount by the total workweeks worked by all participating class members to determine a per-workweek rate. Your class payment equals:

Your total workweeks × per-workweek rate

PAGA Payment Calculation:

The settlement sets aside $31,250 for individual PAGA payments. The administrator divides this by the total PAGA pay periods worked by all aggrieved employees. Your PAGA payment equals your number of PAGA pay periods multiplied by the per-period rate.

Settlement fund breakdown:

Important tax note: Your class payment is split into two parts for tax purposes — 20% is treated as wages (reported on a W-2 and subject to payroll tax withholding) and 80% is treated as penalties (reported on a 1099). Your PAGA payment is also reported on a 1099 as penalties. You will receive both forms if applicable.

How Will You Receive Your Payment?

Because no claim form is required, here is exactly what happens automatically:

Step 1 — The settlement administrator uses Watermark’s payroll records to calculate each class member’s number of workweeks and PAGA pay periods and sends each worker a notice showing their credited amounts.

Step 2 — Review your notice carefully. If the workweek or PAGA pay period count listed on your notice is incorrect, mail a signed dispute letter with supporting documentation — such as pay stubs, time records, or schedules — to the settlement administrator by May 8, 2026.

Step 3 — If you want to opt out of the class settlement portion, mail a written and signed opt-out request to the settlement administrator by May 8, 2026. You cannot opt out of the PAGA payment — that is paid regardless.

Step 4 — If you take no action, you remain in the settlement and will automatically receive both your class payment and PAGA payment by check mailed to your address on file.

Step 5 — If your address has changed since you worked at Watermark, update it immediately by contacting Simpluris at 833-647-9038 or [email protected] before your check is mailed.

Step 6 — Cash your check promptly once it arrives. Contact Simpluris if you do not receive your payment within a reasonable time after the expected payment date.

No action needed to receive payment — but make sure your mailing address is current and review your workweek count on your notice carefully.

Important Deadlines and Dates

Frequently Asked Questions

Do I need to file a claim to receive my payment?

 No. The settlement administrator uses Watermark’s payroll records to automatically calculate your payment and mail a check to your address on file. You only need to act if you want to dispute your workweek count, opt out of the class settlement, or update your mailing address. Do nothing and your check will arrive automatically after final approval.

Is this Watermark settlement legitimate?

 Yes. The settlement, Harris, et al. v. Watermark Services IV LLC, Case No. 23CV035212, is a court-supervised class action. It is preliminarily approved. The official settlement website is watermarkservicessettlementinfo.com, administered by Simpluris, Inc. Verify any communication by calling 833-647-9038 or emailing [email protected].

When will I receive my payment? 

The final approval hearing is scheduled for July 14, 2026. If the court grants final approval and no appeals follow, Simpluris will mail checks to all eligible class members approximately 44 days after that process concludes. Update your mailing address with Simpluris as soon as possible if you have moved since leaving Watermark.

What if I miss the May 8, 2026 opt-out deadline?

 If you do not opt out by May 8, 2026, you automatically remain in the settlement and will receive your automatic payment. You also give up your right to sue Watermark separately over the wage claims this settlement covers. Most workers benefit from staying in the settlement and receiving their automatic payment rather than pursuing individual litigation.

Will this settlement payment affect my taxes?

 Yes — your class payment is split for tax purposes. Twenty percent is treated as wages and reported on a W-2, with taxes withheld automatically. The remaining eighty percent is treated as penalties and reported on a 1099. Your PAGA payment is also reported on a 1099. You may owe taxes on the 1099 portions when you file your return. Consult a qualified tax professional to understand your specific tax obligation.

What is PAGA and why do I get a separate payment for it? 

PAGA stands for the California Private Attorneys General Act — a state law that allows employees to file lawsuits on behalf of the California Labor and Workforce Development Agency for labor code violations. PAGA penalties are split 75% to the state agency and 25% to the affected workers. Your individual PAGA payment comes from that 25% worker share — and importantly, you receive it regardless of whether you opt out of the class settlement portion.

What if I think the number of workweeks on my notice is wrong?

 If the workweek or pay period count listed on your settlement notice does not match your records, you can dispute it. Prepare a signed letter explaining the discrepancy and include copies of supporting documentation — such as pay stubs, time records, or work schedules. Mail your dispute letter to: Harris, et al. v. Watermark Services IV LLC, c/o Settlement Administrator, P.O. Box 26170, Santa Ana, CA 92799. Your dispute must be received by May 8, 2026.

Can I still receive a PAGA payment even if I opt out of the class settlement? 

Yes. The PAGA payment is entirely separate from the class settlement payment. Even if you choose to opt out of the class settlement — which means you give up your individual class payment and preserve your right to sue Watermark separately for wage violations — you still receive your individual PAGA payment. You cannot opt out of the PAGA portion of the settlement under California law.

Sources and References

1. Official Settlement Website — watermarkservicessettlementinfo.com
2. Settlement FAQ — watermarkservicessettlementinfo.com/faq
3. Settlement Documents — watermarkservicessettlementinfo.com/documents
4. California Labor Commissioner — Worker Rights & Wage Claims

California workers who believe their employer has violated wage and hour laws should also understand their legal options and deadlines — our guide on California wage and hour claim statutes of limitations explains exactly how long you have to file different types of claims under state law. If you received a Capital One 360 Savings account payment, you may also want to check the Capital One $425 million 360 Savings Account settlement with automatic payments expected between May and June 2026 for another no-claim-form settlement currently paying out.

Last Updated: March 17, 2026

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Legal claims and outcomes depend on specific facts and applicable law. For advice regarding a particular situation, consult a qualified attorney.

About the Author

Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
Her writing blends real legal insight with plain-English explanations, helping readers stay informed and legally aware.
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