AN UPDATE ON MISCLASSIFICATION LITIGATION, INCLUDING JOINT EMPLOYMENT AND RELATED ISSUES SUMMARY OF 2014 FEDERAL COURT RULINGS IN FLSA COLLECTIVE AND CLASS ACTION MISCLASSIFICATION CASES LINDBERGH PORTER/LITTLER MENDELSON NOVEMBER 7, 2014 Throughout 2014, United States District Courts have continued to grapple
with the mounting increase in traditional misclassification overtime and minimum
wage cases, particularly in the retail and financial services sectors. The District
Courts in 2014 have also ruled on an increasing number of misclassification cases
involving independent contractors, interns, junior accountants, and entry level
“learned” professionals. This paper summarizes rulings on certification motions in
those cases, and in cases that involve interesting or novel issues such as the impact
of some class members being subject to arbitration agreements, the significance of
full blown discovery during the precertification phase of FLSA 216(b) cases, or
handling 216(b) certification issues after ruling on FRCP Rule 23 motions in
hybrid cases.
In addition, this paper summarizes cases presenting some of the interesting
2014 decisions regarding pleadings, statute of limitations, and summary judgment
issues in collective action litigation. The decisions are presented here by industry
categories that include retail, entertainment, financial services, transportation, and
others so that readers might see the quantity and quality of evidence in support of
and in opposition to certification motions and the inconsistency in District Courts’
rulings on certifications motions that ostensibly present very similar issues.
The import of these and other cases will be discussed in detail at the panel
presentation. AN UPDATE ON MISCLASSIFICATION LITIGATION, INCLUDING JOINT EMPLOYMENT AND RELATED ISSUES LINDBERGH PORTER/LITTLER MENDELSON NOVEMBER 7, 2014 SUMMARY OF 2014 FEDERAL COURT RULINGS IN FLSA COLLECTIVE AND CLASS ACTION MISCLASSIFICATION CASES CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
RETAIL Misclassification OT Conditional Certification Hybrid Motion granted
Court certified nationwide class. PLAINTIFF alleged Defendant failed to pay him and others OT; Argued ASMs governed by same set of designated job duties and responsibilities, paid in same manner, classified as exempt, and subject to same job description, corporate policies and work rules; ISO motion, Plaintiff submitted excerpts from his and 9 opt‐ins deposition, and 5 opt‐in declarations, which described how Plaintiffs spent the majority of their time performing non‐exempt duties; Court held evidence from Plaintiff and 14 opt‐ins from approximately 12 states was sufficient to meet modest factual showing requirement. Heitzenrater v. OfficeMax, Inc., 2014 U.S. Dist. LEXIS 13823 (W.D.N.Y. Feb. 4, 2014) Retail
Lytle v. Lowe’s Home Ctrs., Inc., 2014 U.S. Dist. LEXIS 3227 (M.D. Fla. Jan. 10, 2014) Retail
Though Defendant submitted 29 declarations, including one from same store as P, court held this was a credibility issue best left for decertification or challenge to FRCPLAINTIFF 23 class rep status; Misclassification OT Conditional Certification Toll SOL Collective Action Certification granted but Tolling denied Cert: Defendant conceded others wanted to join suit, so only issue was similarity; Plaintiff argued nationwide class appropriate; Plaintiff alleged Plaintiffs had identical job duties, hours, lack of authority, lack of supervision of others, and nearly identical employment history as HR Managers in Defendant stores across US; Also contended she and others all subject to same practice or policy of misclassifications; ISO motion, Plaintiff submitted declarations of approximately 60 former and current HR Managers, which shared common core allegations; Court rejected Defendant’s argument concerning individualized inquiries as premature. Toll: Plaintiff sought tolling from at least 30 days after she filed reply brief; Defendant did not challenge Plaintiff’s diligence, so issue was whether extraordinary circumstances existed; Plaintiff filed initial cert motion March 2013; Based on Second Amended Complaint, court denied as moot cert motion; Amended cert motion filed July 2013; Court held that four months between original and amended certification motion was not extraordinary, and noted that during pendency opt‐ins could have opted into suit or filed individual action. Misclassification – Store Manager Motion To Strike Collective Action Motion granted
Per court, it had authority to consider Defendant’s challenge ‐1‐ Samuel v. Family Retail
Dollar Stores (In CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER Allegations Collective Action ISSUE: Whether Case Could Proceed as Collective Action to propriety of conditional certification without waiting for Plaintiff to seek conditional certification; Court pointed to scheduling order; During discovery, parties exchanged initial disclosures and responded to interrogatories and document requests ‐ Defendant produced more than 21,000 pages of documents, sworn declarations from 19 FL managers, and deposed 10/11 Ps; Plaintiff deposed 8 witnesses of their choosing and had access to over 230,000 pages of documents produced in the MDL litigation, including corporate policies, procedures, and training documents applicable to named Plaintiff. re Family Dollar FLSA Litig.), 2014 U.S. Dist. LEXIS 36206 (W.D.N.C. Mar. 18, 2014) 3:12‐cv‐1951 INDUSTRY
Per court, record revealed significant variation in actual managerial duties performed by named and opt‐in Ps, 2 deposed managers, and other 17 managers; Plaintiffs denied performing most managerial duties contained in company job descriptions, while, in contrast, 19 Defendant managers who submitted testimony, admitted, with some variation, performing many if not all these duties; Per court, Plaintiffs did not rebut a single fact demonstrating they were not similarly situated to other managers. Motion denied Misclassification – Customer Service Representative / Account Manager Conditional Certification Collective Action OT Conditional Certification ISSUE: No Employer Records Collective Action Meriwether v. Beverley Hills Per court, Plaintiff did not come forward with substantial Liquor & allegations that she and others were victims of single decision, Grocery, Inc., policy, or plan to deprive them of OT; Though Defendant failed 2014 U.S. Dist. to keep records, this alone did not demonstrate class victims of LEXIS 6233 (E.D. common policy or plan to violate FLSA; While evidence Mo. Jan. 17, supported individual claim of denied OT, not enough for 2014) certification; In depo, Plaintiff admitted she couldn’t identify other workers who were property paid OT or told to not record OT hours; Defendants testified no policy on denying OT and cashiers trained to properly record all time; Only 1 affidavit other than Plaintiff evidence ISO motion, but, per court, not persuasive because affiant worked at store for a few hours over a very short period of time and never worked OT; Although cert denied, court rejected Defendant arguments that lack of interest in suit was an appropriate factor to consider when deciding certification. Retail
Misclassification – Assistant Store Manager Compel Arbitration / Strike Consent Form (Defendant) Conditional D motion granted
PLAINTIFF motion granted in part; denied in part Fischer v. Kmart Corp., 2014 U.S. Dist. LEXIS 106175 (D.N.J. Aug. 4, 2014) [Unpub] Retail
Suit filed by 2 Ps; ISO motion, submitted 2 declarations concerning their job duties; Court held no factual basis to support Plaintiffs’ contention others perform same duties at other 17 locations, so class evidence limited to facility where Plaintiffs worked; Moreover, court noted that even between themselves they were paid differently, and held many different positions which, in turn, meant they were not representative of class. Butz v. Amware Distrib. Warehouses of Ga., Inc., 2014 U.S. Dist. LEXIS 52422 (N.D. Ga. Apr. 16, 2014) 1:13‐cv‐03204 Motion denied D Motion 3 opt‐ins had signed arbitration agreements, which included class action waiver; All 3 acknowledged agreement and did not opt‐out thereof within specified time; Agreement covered at‐issue dispute; However, Plaintiffs argued motion should be ‐2‐ Retail (Warehouse) CLAIM(S) MOTION(S) & ISSUE(S) Certification Collective Action DECISION
denied or stayed pending ultimate disposition of a mater before NLRB concerning same agreement in a different case and/or until conditional certification ruling; Court held Plaintiffs failed to show sufficient hardship or inequity to justify stay; Moreover, stay pending NLRB disposition would harm Defendant by forcing it to litigate claims until NLRB matter decided. CASE CITE & NUMBER INDUSTRY
13‐cv‐04116
Conditional Certification ISO motion, Plaintiff submitted depositions and corporate documents that tended to show common classification policy; Defendant admitted ASM covered by same OT exemption regardless of individual factors; Per court, while different ASMs may have different shifts, exercise different levels of authority, and manager different number of employees, Plaintiffs satisfied lenient burden for conditional certification for all except stricken opt‐ins and any others who might have applicable arbitration agreements (motion denied as to these individuals). ENTERTAINMENT Misclassification – Intern Conditional Certification Amend Case Management Plan & Scheduling Order Hybrid Certification granted
Amend CM denied Certification: Per court, Plaintiffs demonstrated they were subject to a common policy to replace paid workers with unpaid interns; Though some variance in practices and procedures may exist among entities, department, and locations, court held this did not mean interns were not subject to said common policy. O’Jeda v. Viacom, Inc., 2014 U.S. Dist. LEXIS 47242 (S.D.N.Y. Apr. 4, 2014) [Cert] 2014 U.S. Dist. LEXIS 47097 (S.D.N.Y. Apr. 3, 2014) [CM] 13‐cv‐05658 Entertainment
Misclassification – Intern Conditional Certification Hybrid Motion denied Fraticelli v. MSG Holdings, L.P., 2014 U.S. Dist. LEXIS 63167 (S.D.N.Y. May 7, 2014) 13‐cv‐06518 Entertainment
Grant v. Warner Music Group Entertainment
Court noted that although no interns were paid, this fact alone did not necessarily imply Defendant engaged in common policy or plan that violated FLSA. Court held US DOL 6‐factor intern test was relevant to, and possibly dispositive of, the standard governing the trainee exception; Court held Plaintiffs had not met low burden or showing all interns subject to such a common policy or plan that violated FLSA. For example, named Plaintiff interned at hockey team’s practice facility and responsibilities included preparing uniforms, tracking inventory, and setting up locker room, without much supervision; another procured an architecture‐related internship and observed architects working on ongoing projects, sat in on meetings with consultants and clients, and took field and design measurements and fitting; Per court, significant differences existed among interns in terms of activities performed, supervision, training, benefits received, burdens imposed on D, and manner in which Plaintiffs selected for positions. Misclassification ‐ Intern Conditional Certification Motion granted
‐3‐ CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER Collective Action PLAINTIFF alleged Defendants misclassified him and others as unpaid interns exempt from MW/OT requirements as a result of nationwide policy governing internship programs Corp., 2014 U.S. Dist. LEXIS 65664 (S.D.N.Y. May 13, 2014) 13‐cv‐04449 ISO motion, Plaintiffs submitted declarations from named Plaintiff and 3 opt‐ins; All alleged they performed same work as paid employees; All denied receiving academic credit for at least part of their internships, and claimed to have received little to no supervision; Also claimed personal knowledge of other interns who performed similar duties and were not paid or provided academic credit; Plaintiffs submitted excerpts from website describing internship program – to obtain internship, must apply through centralized website, regardless of department or office location; Website emphasized interns not paid, and set forth policies applicable to all interns, including weekly time requirement; Descriptions of particular internship were identical, regardless of department or location; Per court, from evidence it was reasonable to infer classifying as unpaid interns reflected a national, company‐
wide policy. INDUSTRY
FINANCE Misclassification – Loan Officer Decertification Collective Action ISSUES Administrative Exemption Outside Sales Exemption Motion denied At time of motion, 1 named Plaintiff and 12 opt‐ins involved in case. Court held small differences in job duties primarily related to whether Plaintiffs performed some marketing activities for D, and the vast majority of work was substantively similar, so extra marketing hours went to hours worked and damages. Concerning time when employees non‐exempt, Defendant argued some received OT, but court held this went to damages. Jancich v. Stonegate Mortg. Corp., 2014 U.S. Dist. LEXIS 34152 (D. Kan. Mar. 17, 2014) No. 11‐2602 Finance
Court held fairness and procedural considerations favored collective treatment; Only 13 involved, so size manageable, and allowing to proceed as one more efficient than 12 individuals refilling individual actions. Misclassification ‐ General Manager in Training Conditional Certification Collective Action Motion granted
Plaintiff alleged all GMITs had same job title and performed same or similar duties, and subject to companywide practice of being misclassified as OT‐exempt salaried employee; ISO motion, Plaintiff submitted several declarations from GMITS who described similar circumstances – In typical week scheduled 48‐50 hours; Performed same duties, including learning how to process transactions, learning various techniques for increasing store profitability, and learning how to interview, hire, and supervise staff. Terry v. TMX Fin. Finance
LLC, 2014 U.S. Dist. LEXIS 68523 (N.D. Ill. May 19, 2014) 13‐cv‐06156 Per court, Plaintiffs showed GMITs working in multiple states subject to common plan that may have violated FLSA. FINANCE AND INSURANCE Misclassification OT Motion To Strike Affirmative Defense Motion granted in part; denied in part
Waiver (Granted): Not a defense to OT claims ‐4‐ Sifferman v. Sterling Fin. Corp., 2014 U.S. Finance & Insurance CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
(Plaintiff) ISSUE: Validity of Waiver & Estoppel Defenses Estoppel (Denied): Per court, 9th Circuit hadn’t decided whether estoppel a proper FLSA (Affirmative Defense (AD)); also made clear employer knowledge or consent clearly required for OT violation; Accordingly, Defendant’s AD regarding its lack of knowledge or consent, and Plaintiff’s alleged responsibility for that deficit, could remain. Dist. LEXIS 247 (W.D. Wash. Jan. 2, 2014) Misclassification (O/S Sales) Summary Judgment (Defendant) ISSUE: Exemption Application Motion granted
Finance & Hartman v. Prospect Mortg., Insurance LLC, 2014 U.S. Dist. LEXIS 1661 (E.D. Va. Jan. 7, 2014) Misclassification (O/S Sales) MW OT Summary Judgment (Defendant) ISSUE: Exemption Application Misclassification (Outside Sales) Summary Judgment (Defendant) ISSUES SOL Exemption Application Misclassification Conditional Primary duty was to make sales – admitted responsibility for selling mortgage loans; employment k provided primary duty to sell mortgages away from Defendant’s office; Compensation tied solely to sales volume; Plaintiff had significant independent in dictating her schedule; Plaintiff’s depo testimony illustrated she engaged in sales‐related activities away from Defendant’s office on a regular basis – testified she spent approximately 25‐35% of typical week outside office making contacts, which included attending open houses, auctions, closing, settlements, and chamber of commerce meetings; spent several hours per month creating marketing materials and met with other professionals to generate more business; Though outside work was not constant, court held it sufficed to meet exemption; significantly, Court rejected Plaintiff argument that to qualify sales had to be made at borrowers’ homes or places of business; Court also rejected Plaintiff’s “promotion” work argument because it was in conjunction with sales. Motion granted
Per court, Plaintiff’s primary duty making sales; Plaintiff deposition testimony illustrated she spent approximately 50% of her time each week outside office contacting referral sources (attending seminars, trade shows; meeting financial planners 7 realtors; giving presentations), which were critical because they appeared to constitute her only sales activities 7 ostensibly generated significant portion of her business; Vast majority of remaining time inside office completing loan files; Court here also rejected Plaintiff’s argument that exemption only applied when sales made at borrower’s home or place of business, and that outside activities were directed at referrals sources instead of borrowers so this was non‐exempt promotional work. Motion granted
O/S Sales: Though court held claims were time‐barred, it examined exempt status; Undisputed Plaintiff primary duty to make sales; Fact Plaintiff also performed significant work inside office did not bar exemption; Plaintiff spent significant amount of time each week outside office engaged in sales related activities (meetings with realtors and distributing flyers; attending open houses to network with potential customers; giving seminars); Court noted weighty portion of indispensable components of sales efforts were concentrated outside office; Court held Plaintiff did not need to make sale to borrower at their home or place of businesses. Motion granted
Dixon v. Finance & Prospect Mortg., Insurance LLC, 2014 U.S. Dist. LEXIS 4725 (E.D. Va. Jan. 14, 2014) Finance & Hantz v. Prospect Mortg., Insurance LLC, 2014 U.S. Dist. LEXIS 14359 (E.D. Va. Feb. 5, 2014) Puglisi v. TD ‐5‐ Finance & CLAIM(S) OT MOTION(S) & ISSUE(S) Certification Collective Action DECISION
Plaintiffs worked in branches in NY, NJ, and PA sought to represent nationwide class; ISO motion, Plaintiffs submitted 13 affidavits, employee handbook, and other documents. Per court, undisputed that under employer policy ASMs ineligible for OT, and that ASM hours not tracked; Also, none of Defendant’s 40 affiants disputed Plaintiffs contention they typically worked 40+ hours per week; Plaintiffs provided evidence that ASMs nationwide had similar non‐managerial duties – affidavits covered ASMs in 7 states; sampling of job postings in 7 states “starkly similar” per court; Per court, similarities tend to suggest ASM across country treated uniformly to some degree and that they had similar job duties and requirement. Misclassification (O/S Sales) MW OT Conditional Certification Collective Action Misclassification – Loan Officer Compel Arbitration (Defendant) Collective Action Motion granted
(In support of) motion, Plaintiff submitted declarations and corporate admissions that all loan officers classified as exempt outside salespeople; Defendant compensation plan applies to all loan officers; All loan officers subject to the identical job description that outlines the identical primary job duties; Same employee handbook applies to all loan officers; Loan officers generally paid on 100% commission basis and are not eligible for OT or MW payments; All loan officers employed on full‐time basis and regularly scheduled to work a minimum of 40 hours per week. Motion granted (case stayed)
Employment agreement contained arbitration clause; Court held arbitration agreement was valid and enforceable; Complaint allegations specifically related to Plaintiff’s employment, which fell within arbitration clause; Plaintiff wouldn’t be prejudiced by enforcement because litigation in beginning stage and neither party expended significant amounts of time or money. CASE CITE & NUMBER INDUSTRY
Bank, N.A., 2014 Insurance
U.S. Dist. LEXIS 23935 (E.D.N.Y. Feb. 25, 2014) McCallister v. First Banks, Inc., 2014 U.S. Dist. LEXIS 32590 (E.D. Mo. Mar. 13, 2014) 4:13‐cv‐00561 Finance & Insurance Nereim v. Finance & Premara Fin., Insurance Inc., 2014 U.S. Dist. LEXIS 86385 (W.D.N.C. June 24, 2014) 3:14‐cv‐00096 To the extent others had already opted into suit, court provided 2 options: 1) participate in arbitration as ordered for named P(if similar agreements existed); or 2) If no agreement exists, file separate lawsuit. [Note: Although option 1 inferred Plaintiffs could participate in arbitration, arbitration agreement specifically stated “I will participate only in my individual capacity, not as a member or representative of a class or part of a class action or in a consolidated case, provided this will not impair my right to engage in collective action under Section 7 of the National Labor Relations Act.”]. HEALTHCARE Misclassification OT Conditional Certification Hybrid Motion granted
FRCP 23 certification also granted Defendant unsuccessfully argued decertification standard should be applied to certification motion because discovery closed, but court noted that scheduling order contemplated initial period for class discovery, after which motion would be filed, then later discovery following certification ruling; ‐6‐ Kurgan v. Chiro One Wellness Ctrs. LLC, 2014 U.S. Dist. LEXIS 20255 (N.D. Ill. Feb. 19, 2014) Healthcare
CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
Instead, court applied intermediate standard (“modest plus”). Misclassification – Account Manager Rounding Conditional Certification Collective Action Motion granted
Court previously denied without prejudice initial motion to conditionally certify a nationwide class of all Account Managers, which included both salaried and hourly‐paid AMs; Court granted Plaintiffs leave to conduct additional discovery to obtain further support for proposed class or to determine a lessor appropriate scope of its class definition. Plaintiffs had 3 months to conduct additional discovery; Plaintiffs submitted affidavits from 15 former and current salaried AMs from 21 facilities in Texas, North Carolina, South Carolina, Indiana, Washington, California, and Kentucky – all contended that despite exempt status, they performed manual labor between 50‐90% of workday.. Defendant produced about 1300 pages of documents and Plaintiff deposed Defendant’s Senior VP; However, court held discovery still considered fairly limited, when measured against proposed nationwide class, which would involve employees in 48 states at over 3,000 facilities; Accordingly, court applied notice stage analysis, and would not apply heightened standard. Misclassification ‐ MDEFENDANTS Coordinator Overtime Off‐the‐clock ‐ Meals Conditional Certification Motion denied Kelly v. Healthcare Servs. Group, Inc., 2014 U.S. Dist. LEXIS 61216 (E.D. Tex. May 2, 2014) 2:13‐cv‐00441 Folger v. Medicalodges, Since filing complaint, 12 current and former employees opted Inc., 2014 U.S. into suit; Suit filed against entity that operated 23 skilled Dist. LEXIS nursing facilities in Kansas, Missouri, and Oklahoma; Plaintiff 86286 (D. Kan. alleged she and others were misclassified as exempt and not June 25, 2014) paid overtime, and also worked during meal periods. Court applied intermediate standard based on discovery that 13‐cv‐01203 occurred (relating to certification), along with parties submitting items outside of the complaint (e.g., Defendant submitted almost 100 “happy camper” declarations; Plaintiff counsel placed ad in newspapers where facilities located; Plaintiff pointed to deposition testimony). Hourly Employee Class Plaintiff sought to certify class of all hourly employees who were not paid for OTC work during meal periods; Court held Plaintiffs did not offer direct evidence that Defendant adopted unwritten policy not to pay for meal periods, but instead attached identical declarations from 11 opt‐ins stating Plaintiffs were routinely called away from meal period to perform work. Court observed class would comprise over 2,000 employees who worked for numerous managers in various facilities; Evidence did not support Plaintiffs’ contentions; Conditionally certifying class would result in enormous expenses to both parties; In light of dissimilarities and Plaintiffs’ failure to identify across‐the‐board policy, court held interests of justice required case to proceed without certification. Salaried MDEFENDANTS Coordinator Class Court held mere classification of group employees as exempt – even large or nationwide group – was not by itself necessary ‐7‐ Healthcare
Healthcare
CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
evidence of a common policy, plan, or practice that rendered class similarly situated. Misclassification – Independent Contractor MTD (Defendant) ISSUE: Pleading ‐ Overtime Motion denied P, CNA who later became staffing coordinator at nursing registry, alleged OT violations. SMJ: Defendant argued court did not have jurisdiction over claim; Court held FLSA coverage status—whether Plaintiff was an employee, or if Defendant was engaged in commerce or had 2 or more employees engaged in commerce—is not a jurisdictional prerequisite to an FLSA claim but are elements of the claim to be established in discovery. Bohenkamp v. JT Private Duty Home Care, LLC, 2014 U.S. Dist. LEXIS 125088 (M.D. Fla. Sept. 8, 2014) 2:14‐cv‐00366 Healthcare
Business Services Overtime: Allegations sufficed; Plaintiff alleged she worked more than 40 hours as an employee and was not paid 1.5 times regular rate for OT hour; That Defendant was engaged in commerce within meaning of FLSA § 7, and Defendant was an FLSA employer; Per court, sufficient to put Defendant on notice of claims against it. TRANSPORTATION Misclassification (Motor Carrier Act) Summary Judgment (X) ISSUE: Whether Intrastate Truck Drivers Involved in Interstate Commerce Pritchett v. Werner Enters., 12 plaintiffs were truck drivers for company that provided 2013 U.S. Dist. trucking services to paper mill operator; Plaintiffs conceded LEXIS 181523 employer’s business subject to DOT jurisdiction under MCA, so (S.D. Ala. Dec. only issue was whether activities directly affected safety of 31, 2013) operation of motor vehicles; No Plaintiff transported paper products outside the state. Motion: Plaintiffs
Transportation
Per court, movement of jumbo rolls from base mill to sheeter facility was not transportation of property in interstate commerce for purposes of MCA exemption. Plaintiffs also drove “yard trucks” on sheeter facility to move trailers around grounds; some trailers loaded with finished produced, which were destined to travel across state lines, and some Plaintiffs used yard trucks to carry raw materials and waste products between paper mill’s 3 facilities and to refuel at gas station; Court held first activity this did not satisfy 6‐part test, and especially 4th requirement (public highways), and that second activity did not implicate 6th (interstate commerce); Court held no as to Defendant’s position that if an employee engaged in two activities, neither of which wholly triggered MCA exemption, that employer can invoke exemption simply because between them activities implicate all exemption requirements. Misclassification – Independent Contractor Conditional Motion granted
Certification PLAINTIFF argued he and others misclassified and not paid proper MW or OT; Plaintiff affidavit stated he and others had Collective Action similar jobs, were paid in a similar manner, and were subject to a single decision, policy, or plan resulting in the alleged misclassification and wage violations; Several individuals filed consent forms. Scheidler v. Safeway Rd. Servs., 2014 U.S. Dist. LEXIS 52442 (S.D. Tex. Apr. 16, 2014) 13‐cv‐03158 Transportation
Misclassification – Ind. Contractor Conditional Certification Ross v. Jack Rabbit Servs., Transportation
Motion granted
‐8‐ CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER Collective Action ISO motion, Plaintiff submitted his declaration and several exhibits; Plaintiff required to be on‐call 24 hours per day, 7 days per week; Also required to routinely work more than 70 hours per week; Customer assignments given by Defendant; Defendant directed type of service to provide; Defendant required Plaintiff to undergo training and continuing education; Defendant required Plaintiff to wear Defendant uniform; Defendant required Plaintiff to keep signage on Plaintiff’s vehicle; Defendant determined tools and equipment to use; Defendant required Plaintiff to use forms and invoices Defendant provided, and to deliver invoices and customer reports within 7 days of each job; Defendant required Plaintiff to maintain and distribute Defendant business cards; Court held sufficient evidence demonstrated for common policy; While court found Defendant argument re employment status compelling, it held this was a merits‐based argument that was premature. LLC, 2014 U.S. Dist. LEXIS 72950 (W.D. Ky. May 29, 2014) 3:14‐cv‐00044 INDUSTRY
RESTAURANT AND BARS Misclassification – Assistant Manager Conditional Certification Collective Action Misclassification – Assistant Manager Decertification Collective Action ISSUES Executive Exemption Administrative Exemption Motion denied Lankford v. CWL Investments, 2014 U.S. Dist. LEXIS 111929 (E.D. Mich. Aug. 13, 2014) 13‐cv‐14441 Restaurants and Bars Stevens v. HMSHost Corp., After class conditionally certified, 275 opted into lawsuit (19 2014 U.S. Dist. deposed). LEXIS 119653 Per court, Defendant’s blanket classification decision did not (E.D.N.Y. Aug. on its own render Plaintiffs similarly situated, though it can be 26, 2014) evidence of similarity; Also, it was not dispositive that Plaintiffs subject to uniform corporate policies and received uniform 10‐cv‐03571 training; Although policies prescribed how to perform discrete tasks (e.g., ringing cash register, lifting heavy items, serving food), they did not dictate particular job duties of each AM. Restaurants and Bars Motion filed more than 15 months after discovery closed, so court applied heightened standard; Plaintiff argued against standard, noting Defendant refused to provide information re other AMs in response to discovery requests, Plaintiff had problems, due to Defendant’s calendar, scheduling 30(b)(6) deposition, and Defendant tardy in responding to discovery requests; Court held Plaintiff never filed motion to compel discovery, and court need not require significant discovery to view motion with heightened standard. (In support of) motion, Plaintiff relied on his affidavit and Defendant’s employee policy guidebook; Court held single policy of misclassification insufficient; Plaintiff presented no evidence that other AMs performed work in similar manner; Outside of pointing to classification and noting Plaintiff worked with other AMs and that other employees similarly situated to Plaintiff have worked for Defendant but were not paid OT, no evidence opt‐ins were similarly situated to Plaintiff; Defendant also observed no others indicated desire to opt‐in. Motion granted
However, court not persuaded by Defendant argument that variations in location, size, and type of restaurant by themselves precluded similarly situated finding; Though it had ‐9‐ CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
inherent appeal, the record did not bear this out – other than identifying deponents who supervised disparate number of hourly employees, Defendant did not show example of a correlation between location and job duties. But, examining testimony about duties and managerial authority level, court noted dissimilarities and variation, e.g., some had scheduling or discipline authority while others required manager or HR approval; Differences existed concerning involvement in hiring and firing process, and evaluations; Defendant also argued individualized defenses precluded class treatment; Although court rejected issue of Plaintiffs who failed to disclose claims in bankruptcy – noting this went to damages, not liability – it credited Defendant argument about credibility challenges (e.g., differences between what Plaintiffs wrote in yearly self‐evaluations concerning managerial work compared to what they said during deposition), and also sided with Defendant concerning Plaintiffs having widely dissimilar levels of managerial authority and duties, thereby precluding a class‐wide exemption defense – per court, determining exempt status required individualized, rather than representative proof. Court held fairness and procedural considerations guides by above – disparate factual and employment settings and individualized defenses. TECH AND BIOTECH Misclassification OT Conditional Certification Hybrid Motion granted
1 Plaintiff filed suit (CA), and complaint amended to include 2 additional Plaintiffs (MA & MD); Suit sought nationwide FLSA class, and various state classes. Defendant unsuccessfully argued second stage analysis should apply because pre‐certification discovery occurred, and it produced over 50,000 pages of documents and provided Rule 30(b)(6) witnesses, deposed named Ps, and Plaintiff sent letter to entire putative class (and beyond), notifying them of action and soliciting opt‐ins; Court would not apply second stage analysis until discovery closed Benedict v. Technology
Hewlett‐Packard Co., 2014 U.S. Dist. LEXIS 18594 (N.D. Cal. Feb. 13, 2014) Court held Plaintiffs demonstrated they were victims of single decision, policy, or plan – being subject to same uniform classification of exempt status; Defendant’s job architecture policy uniformly categorized all putative members as exempt; Also held evidence indicates that propriety of classification can be determined on class wide basis – ISO motion, Plaintiffs relied on complaint, and 33 declaration and Defendant documents which suggested putative members are similarly situated regarding job duties. Misclassification – Exempt Conditional Certification Collective Action Motion granted in part; denied in part
Altiep v. Food Safety Net ISO motion, Plaintiffs relied on complaint and declarations – Servs., 2014 U.S. Paid on salary basis; Routinely worked more than 40 hours per Dist. LEXIS week and not paid OT; Job responsibilities were performing 114835 (N.D. and reading test results per Defendant manuals and lab ‐10‐ Biotech
CLAIM(S) MOTION(S) & ISSUE(S) DECISION
procedures, performing preventative maintenance by cleaning and sanitizing equipment, assisting in QC, and monitoring lab conditions and equipment; alleged personal knowledge that their job responsibilities and pay similar to others in labs outside California; Declarations from former lab techs alleged same things; Plaintiffs also submitted job postings listing position as exempt and detailing responsibilities that largely mirrored Plaintiffs’ responsibilities; CASE CITE & NUMBER INDUSTRY
Tex. Aug. 18, 2014) 3:14‐cv‐00642 Concerning interest in joining suit, court held Plaintiffs only required to show reasonable basis to believe other aggrieved individuals exist, which they did; Noted 2 had already opted into suit and a third expressed interest; Since motion filed, 9 additional opt‐ins. D argued no generally applicable policy or practice demonstrated, but court held Postings listing position as exempt, which were prepared by HR Director and approved by COO suggested there may have been coordination on classification. OIL AND GAS Misclassification – Independent Contractor Conditional Certification Collective Action Motion granted
(In support of) motion, Plaintiff relied on complaint and submitted 2 affidavits – 1 by him, and another by an opt‐in; Both alleged they worked as flow testers, were misclassified as independent contractors, that dozens of flow testers were misclassified, and that Plaintiffs and other flow testers were not paid OT; Additionally, 5 consent forms filed. May v. E & J Well Serv., 2014 U.S. Dist. LEXIS 87826 (D. Colo. June 27, 2014) 14‐cv‐00121 Oil & Gas
Misclassification ‐ Drilling Fluid Specialist Misclassification ‐ Mud Engineer Misclassification ‐ Mud Man Misclassification ‐ Mud Man Trainee Misclassification ‐ Consultant Mud Man Conditional Certification Hybrid Motion granted
Syed v. M‐I, L.L.C., 2014 U.S. Dist. LEXIS 104820 (E.D. Cal. July 30, 2014) 1:12‐cv‐01718 Oil & Gas
Plaintiffs alleged misclassified as exempt and Defendant did not pay OT or for off‐the‐clock work; claims under FLSA and California law. Defendant unsuccessfully argued heightened standard should occur because some discovery had occurred, and because preliminary notices sent by Plaintiffs. Concerning similarity, court held Plaintiffs adequately demonstrated all subject to same uniform classification of being exempt; Declarations ISO motion confirmed Plaintiffs paid on salary basis and not paid for OT, travel time, or missed meal/rest breaks; If additional days worked they were paid additional daily rate, and Defendants did not contest that Plaintiffs paid in different manner. Per court, Plaintiffs set forth substantial allegations in complaint and submitted 4 declarations, along with documents, which suggested putative class had similar job duties; Under Defendant job descriptions, 5 positions shared identical functions and responsibilities; Moreover, Plaintiffs declarations stated they and others with their job title shared substantially similar job duties; Moreover, declarations provided by Defendant corroborated members engaged in similar job functions; Although court acknowledged there were difference between putative members, it held this did not change its conclusion, because Plaintiffs needed to show ‐11‐ CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
similarity, not identicalness, and because notice stage not appropriate time to evaluate merits of claims. OTHERS Misclassification OT Decertification Collective Action Misclassification (Motor Carrier Act) OT Conditional Certification Toll SOL Collective Action ISSUE: Tolling Motion denied Per court, evidence reflects Plaintiffs performed similar day‐
to‐day functions, and minor factual deviations did not defeat collective treatment; Deposition testimony of Plaintiff and Defendant witnesses showed Plaintiffs performed same duties, nearly all given same job title and description, underwent same training program, and subject to same policies (including no OT); To the extent they were engaged in managerial tasks, it was limited; Concerning available defenses, court held determining whether Plaintiffs exempt would not make class unmanageable evidence reflected Plaintiffs performed substantially similar duties and nearly all had same position; though some variations existed concerning certain aspects of job duties, court held these were immaterial; Finally, procedural considerations weighed in favor of class treatment. Certification granted
Tolling denied Cert: Defendant unsuccessfully argued all exempt so certification inappropriate – question is premature, and doesn’t go to similarity at notice stage. Ruffin v. Avis Budget Car Rental, LLC, 2014 U.S. Dist. LEXIS 9562 (D.N.J. Jan. 27, 2014) (Unpub) Automobile Rental Courier
Rojas v. Garda CL Southeast, Inc., 2013 U.S. Dist. LEXIS 179595 (S.D. Fla. Dec. 23, 2013) Court noted 10 opt‐ins filed consent forms, and an addition 4 filed notice of intent to join if certified; Court observed on 2 notices to join as party Plaintiffs and 2 of intent to join state they were drivers/messengers; Named Plaintiff only declarant to assert personal knowledge of other drivers/messengers who indicated interest in joining suit, though it did not indicate how many. Though many affidavits may be from non‐covered employees, court held the 4 plus named Plaintiff was sufficient to establish reasonable basis others did want to join. Also, Defendant noted driver and messenger same position, so court held all Plaintiffs held same job title; all worked in same geographic location; violations occurred in same period; Plaintiffs alleged all subject to Defendant’s “overtime over 50” policy; Defendant did not assert policy was applied different to drivers/messengers or that only some subject to policy. Tolling: Plaintiff moved for 31‐day tolling based on court granting Defendant’s motion for 31‐day extension to respond to cert motion; Per court, this was routine and not extraordinary. Misclassification – Director of Social Services Compel Arbitration (Defendant) ISSUE: Impact of Arbitration Agreement Motion granted (case stayed)
Plaintiff signed employment agreement, including arbitration agreement, when employment began; Arbitration agreement covered claims relating to employment, including FLSA claims. Plaintiff initially worked in PT position, filling in to cover for another individual who was on maternity leave; When that ‐12‐ Ryan v. LPLAINTIFF Fort Myers, LLC, 2014 U.S. Dist. LEXIS 92537 (M.D. Fla. July 8, 2014) Government
CLAIM(S) MOTION(S) & ISSUE(S) Signed During Initial Employment When Employee Leaves but Later Returns to Company Misclassification (Administrative) OT Summary Judgment (Defendant) ISSUE: Whether Failure to Plead Exemption Waived Entitlement DECISION
employee returned, Plaintiff was no longer needed.
Plaintiff returned to work 4 months later; Upon return, no new arbitration agreement signed, and this time Plaintiff worked as FT employee, and this employment period is at‐issue in case – Plaintiff argued entitled to OT. CASE CITE & NUMBER INDUSTRY
2:14‐cv‐00231 Court held arbitration agreement was valid; Also noted that no language within agreement limited arbitration to apply to only one type of position with company or only one timeframe of employment; Held issues concerning scope of arbitration should be resolved in favor of arbitration; Also held litigants retained all substantive rights in arbitration, so, if arbitrator found it proper, Plaintiff could recover AF&C. Motion granted
Waiver: Although exemption not specifically pleaded in answer, Defendant multiple times claimed Plaintiff was an exempt employee and denied Plaintiff was non‐exempt; Defendant also argued Plaintiff conducted discovery on exemption issue; Court held exemption not waived, and that Plaintiff on notice of intention to pursue defense. Antiskay v. Contemporary Graphics & Bindery, Inc., 2013 U.S. Dist. LEXIS 180323 (D.N.J. Dec. 26, 2013) Graphic Arts Printing Admin: Salary met; Primary Duty (Plaintiff’s duties do not fall squarely on the production side of the line, the administrative/production dichotomy is not determinative in this particular case); Plaintiff exercised discretion and independent judgment with respect to matters of significance (e.g., product layout; could commit Defendant to matters with significant financial impact). Misclassification OT Conditional Certification Collective Action Motion granted
Approximately 4‐7 potential class members; class members provided media support for law firms, e.g., setting up and operating media equipment during trials. Court held. King v. On the Record, Inc., 2014 U.S. Dist. LEXIS 9175 (N.D. Cal. Jan. 24, 2014) Legal
Misclassification ‐ Pipette Calibration Specialist Misclassification ‐ Field Pipette Calibration Specialist Conditional Certification Hybrid Motion granted
Hensley v. Eppendorf N. Am., Inc., 2014 U.S. Dist. LEXIS 78477 (S.D. Cal. June 5, 2014) 14‐cv‐00419 Manufacturing
PLAINTIFF alleged misclassification resulting in minimum wage and OT violations under FLSA / California law; Also alleged meal/rest, vacation payout, and wage statement violations; Included UCL and PAGA claims. ISO motion, Plaintiff submitted a declaration discussing his job duties, and observations re other technicians (PLAINTIFF worked in 2 different positions); Also attached copies of job descriptions, which outlines necessary qualifications and skills, duties and responsibilities, and work environment; Plaintiff contended he received training materials and manuals that instructed technicians how to handle tasks, and stated that he observed other technicians use these and similar procedural documents in performing jobs, and that he and others could be disciplined for deviating from procedures; Plaintiff also alleged uniform misclassification. D argued only 40 potential class members and that it was likely only a few would opt into suit; Also alleged Plaintiff did not demonstrate others’ interest in joining suit; Court held ‐13‐ CLAIM(S) MOTION(S) & ISSUE(S) DECISION
CASE CITE & NUMBER INDUSTRY
that requiring a showing of interest made little sense given purpose of certification if to give notice to potential plaintiffs. Court held notice stage burden met based on allegations and documentation; Noted that defense declaration used to argue differences between putative class working conditions would not negate factual nexus that bound Plaintiff and putative class, and that determinations about differences was premature at this stage. Misclassification – Audit Associate Misclassification – Independent Contractor Summary Judgment (X) Hybrid ISSUE: Professional Exemption Conditional Certification Collective Action Affirmed Putative hybrid class action; District court had granted defense summary judgment, and denied plaintiffs’ summary judgment; Plaintiffs appeals. This case requires us to determine whether junior employees at a major accounting firm who received substantial specialized education as accountants, were designated as accountants by their employer, performed entry‐level accounting tasks, and are automatically promoted to a more senior accounting position after two years of satisfactory employment qualify for the learned profession exemption. We hold that they do, and thus are exempt from the FLSA’s overtime requirements. Pippins v. KPMG LLP, 2014 U.S. App. LEXIS 13997 (2d Cir. July 22, 2014) No. 13‐889 Professional Business Services Telecommunica
Simmons v. Broadway Home tions PLAINTIFF alleged Defendants had policy, practice, or plan of Improvement denying OT to technicians; Alleged all technicians performed Inc., 2014 U.S. same job duties, were subject to same pay policies and Dist. LEXIS procedures, and worked similar schedules and hours without 102420 (S.D. OT; ISO motion, Plaintiff filed 4 affidavits (his and 3 others); Ind. July 28, Court observed in answer Defendant admitted that technicians 2014) were paid on piece‐rate basis, were considered independent contractors, were not paid OT, and were subject to 1:14‐cv‐00483 Defendants’ control on certain things such as scheduling, installation procedures, uniforms, vehicles, and job inspections, though Defendant denied they were employees or that companywide practice resulted in non‐payment of OT. Motion granted
D also noted all declarations from technicians in one district and that Plaintiffs did not know about practices elsewhere; While true, court observed that one declarant, who served as General Manager for Defendant, attested that all technicians, regardless of location, had same job duties, used equipment provided by D, were required to attend Defendant meetings, were paid on piece‐rate basis, regularly worked more than 40 hours per week, were not paid OT, and had to sign IC agreements. Misclassification (Motor Carrier Act) OT Conditional Certification Collective Action Motion granted
Defendant did not have written policy or plan on how it paid wages, and argued potential Plaintiffs paid differently (salary, hourly, daily) based on experience and seniority, and that payment determined on individual basis; Plaintiff argued Defendant required all to clock in and out and paid them for on the clock work and paid additional $10 per hour for off‐
the‐clock work; 5 Plaintiff declarants stated they knew others who worked similar hours, received daily rate and were not ‐14‐ Villegas v. Grace Disposal Sys., LLC, 2014 U.S. Dist. LEXIS 25033 (S.D. Tex. Feb. 27, 2014) Waste Management CLAIM(S) MOTION(S) & ISSUE(S) DECISION
paid OT for OT hours (and identified, to some degree, these other employees), though Defendant argued this was contradicted by their depo testimony in which they did not know how others were paid and/or did not identify other employees; Concerning interest of others in joining suit, Plaintiffs contended others likely reluctant because Plaintiffs alleged they were fired for complaining about at‐issue practices; Court noted that several drivers opted into suit by becoming named Ps, and that their declarations and depo testimony, coupled with Defendant rep admitting some paid flat daily rate, meant Plaintiffs met their burden of common policy and similarity to others, and also acknowledged potential reluctance based on retaliation allegations. ‐15‐ CASE CITE & NUMBER INDUSTRY