Overtime Attorney Blog

Sandoz filed a purported §216(b) collective action against Cingular alleging that she and similarly situated contract sales consultants were not paid minimum wage. Sandoz filed her case, which was removed to federal court. Cingular then made a Rule 68 offer of settlement, and moved to strike Sandoz’s case for lack of subject matter jurisdiction (the make whole offer would divest the district court of jurisdiction). The trial court denied the motion, and the matter came to the Fifth Circuit on expedited appeal.

As a threshold matter, the Fifth Circuit concludes that, unless and until similarly situated employees opt in, a named plaintiff represents only herself. This would ordinarily render the case moot.

However, or “luckily” as the Court puts it, the relation back doctrine allows the motion for class certification to relate back to the filing of the complaint. The test is whether the named plaintiff timely seeks certification without undue delay. Then, if the trial court grants certification, the Rule 68 offer is void because it fails to account for the class. If the trial court denies certification, the Rule 68 applies and renders the named plaintiff’s case moot.

Finally, it is worth noting that footnote 2 appears to bless two-stage certification.

The case is Sandoz v. Cingular Wireless, LLC, --- F.3d ----, 2008 WL 5341434 (5th Cir. Dec. 23, 2008).

One person can make a difference. Constemecka Russell sued Illinois Bell Telephone Company for unpaid overtime and asked the Court to certify her lawsuit as a class action. Ms. Russell asked the Court to send notice to all current and former hourly employees of Illinois Bell call centers in Arlington Heights, Chicago, Rock Island, and Oak Brook who worked sales, service, and similar positions. After Ms. Russell filed her lawsuit, a number of additional call center employees signed forms consenting to be Plaintiffs. The Court applied the two step class certification process. The Court noted evidence of a company-wide policy and practice and that the putative notice recipients are similarly situated.

Illinois Bell argued that the Plaintiff’s proposed notice should be modified. Illinois Bell argued that having the district and magistrate judges name on the notice would cause potential class members to believe that these judges had endorsed the claims in the case. The Court noted that the proposed notice was done on Court letterhead, did not include judicial signatures, and should contain disclaimer that Court has taken no position about the merits of Plaintiff’s claims or Defendants’ defenses. Thus the Court saw no reason to remove the judge’s names. Illinois Bell objected to a statement that individuals who opt-in to the action will be represented by the Plaintiff’s attorneys. The Court refused to reject this language because it was correct. The Court did allow Illinois Bell to insert language that individuals who join maybe required to take an active role in the litigation.

The Plaintiff requested an Excel spreadsheet listing the names, last known addresses, telephone numbers, last four digits of their social security number, and other information regarding potential plaintiffs. Illinois Bell sought to withhold telephone numbers and social security numbers. The Court found that, because the Plaintiffs may use reverse directory searches to locate new addresses for Plaintiffs, telephone numbers must be produced. The Court also found that because partial social security numbers would be used to locate updated contact information, that information must also be produced.

The case is Russell v. Illinois Bell Telephone Co., --- F.Supp.2d ----, 2008 WL 4191763 (N.D.Ill. Sept. 15, 2008).

Store managers of Caribou Coffee filed suit for unpaid overtime. The Plaintiffs claimed that they were not properly classified as executives under the executive exemption to the FLSA. Previously, the district court had certified a class action for federal claims arising under the FLSA. In considering motions made by both the Plaintiffs and the Defendants, the Court made the following rulings:

(1) The Court denied the Defendant’s motion for decertification,
(2) The Court denied Plaintiff’s motion to reopen the opt-in period, and
(3) The Court granted Plaintiff’s motion for class certification of Minnesota state law claims.

At this second stage of the class certification process, the Court considered three factors (1) the extent and consequences of disparte factual and employment settings of the individuals Plaintiffs, (2) the various defenses available to Defendants which appeared to be individual to each Plaintiff, and (3) fairness and procedural considerations. The court summarized Plaintiffs evidence and found that Plaintiffs had presented specific factual evidence that Caribou store managers had the same job duties and responsibilities, consistently worked more than forty hours each week, and were all impacted by Caribou’s internal policy and practice of considering store managers similarly situated for the purposes of Caribou’s own determination and review. The Court differentiated the instant case from Smith v. Heartland Automotive Services, Inc. because the Caribou managers showed that the written job description generally defined the duties of the Caribou managers. In the Heartland case, involving Jiffy Lube store managers, the Plaintiffs argued that their actual daily duties were different from those in the company job description and therefore there was no common method of defining the job duties. Similarly, the Court differentiated the instant case from Carlson v. C.H. Robinson Worldwide, Inc. in that Carlson involved substantial variations in duties. In particular, the Plaintiffs deposed a former director of operations and district manager who testified that the job duties of the Caribou managers were uniform. The Court also found that the individuals were similarly situated in that they all worked overtime. The named Plaintiffs and eighty-five randomly selected opt-in Plaintiffs completed a questionnaire survey. These questionnaire surveys showed that Caribou managers routinely worked in excess of forty hours per workweek.

Finally, the Court found that Caribou itself considered the managers to be similarly situated when it made its own determination that managers were exempt under the executive exemption. The Court stated that Caribou’s own actions lessened any concern about variations in the Plaintiffs’ employment circumstances. The Court found it “disingenuous” for Caribou to on the one-hand collectively and generally decide that all store managers are exempt, while on the other hand, claimed that Plaintiffs cannot proceed collectively to challenge the exemption.

In considering whether Caribou’s defenses would make the proposed collective action unmanageable, the Court noted that Caribou’s defenses related only to damages. Therefore, the Court recommended a bifurcation of the case into a liability stage followed by a damages stage.

Although the Defendants failed to address the issue of fairness and procedural considerations, the Court made its own inquiry sua sponte. Noting the broad and important purposes of the FLSA and the burdens of decertification, the court concluded that fairness and procedural considerations were satisfied.

The Court then turned to the issue of Minnesota state law overtime claims, these claims must be certified under the requirements of Rule 23 of the Federal Rules of Civil Procedure.

The Court noted that it had supplemental jurisdiction over Minnesota state overtime claims because the state law overtime claims and FLSA claims arise out of the same common nucleus of operative facts. The Court rejected Defendants contention that state law claims would substantially predominate the action by comparing the number of state claims to federal claims asserted. The Court noted that there were 400 individuals who had opted in to the federal overtime claims and the estimate of individuals with state law claims ranged from 150 to 400. Rather, the ratio of state claims to federal claims was not so great as to cause state claims to predominate. The court also noted that the federal and state claims were inherently interrelated. The Court also found no “exceptional circumstances” to justify declining certification of the state law claims.

The Court then turned to the requirements of Rule 23. The Court reiterated its finding that the class members were similarly situated, that they satisfied the numerosity requirement that questions of law and fact are common to all claims, that the named Plaintiffs had claims that were typical of the class members and that the class was adequately represented.

Although several hundred individuals opted in, this case had only three named Plaintiffs. One of the named Plaintiffs, Williams-Goldberg, was not representative of the class because her claims fell outside the stated statute of limitations. The Court found that Williams-Goldberg’s failure to meet the requirements for class representative was not fatal because only “one or more member of a class” need be representative.

The Court moved onto Rule 23(b) and found that common claims dominated and that class certification of claims was superior to other methods of resolving state law claims.

The Plaintiffs moved to reopen the opt-in period because Caribou had opened over 150 stores since the original granting of class certification. The Court found that this would great a never-ending class certification process, prevent discovery with a definite beginning and ending. Presumably, store managers not covered in the instant case could file their own new FLSA action.

The case is Nerland v. Caribou Coffee Company, Inc., 564 F.Supp.2d 1010(D.Minn. May 17, 2007).

The United States District for the Middle District of Florida conditionally certified a class of loan officers in an FLSA action seeking unpaid overtime. The Court applied the lenient standard for notice stage certification and required the Plaintiffs to show (1) that there are other employees who desire to opt into the action, and (2) that those employees are similarly situated.

The Plaintiffs submitted nineteen declarations showing that the putative class members all engaged in cold calling to prospective customers, trying to sell loans to customers, and completing loan applications. The Defendants claimed that differences existed from branch to branch, including differences in job title and job duties. The Court found that such variations were factual issues that are not considered at the notice stage. The Court also disregarded the Defendants' assertion that decisions regarding classification of loan officers are made at the branch level, rather than the corporate level. The Florida Court noted that the existence of a common policy or plan is relevant to whether judicial economy would be served by a collective action and that such issues are more appropriately addressed at the decertification stage.

The Court, apparently sua sponte, noted that the class to be noticed was larger than Plaintiffs request for all “loan officers.” Therefore, the Court defined the class based on specific job duties rather than on job title.

The case is Vondriska v. Premier Mortgage Funding, Inc., 564 F.Supp.2d 1330(M.D.Fla. May 10, 2007).

Following trial but before rendering a verdict, Judge Sarah S. Vance decertified a nationwide collective action of assistant store managers against their employer, Big Lots. The assistant store managers claimed they were improperly classified as exempt under the executive exemption.

Ultimately, however, the Court noted there were simply too many discrepancies between Plaintiffs to support class certification, which relies on the Plaintiffs being similarly situated.

The Court noted that three Lusardi factors are predominantly used to determine if members of class are similarly situate:

(1) the extent to which the employment settings of employees are similar or disparate; (2) the extent to which any defenses that an employer might have to overtime or misclassification claims are common or individuated; and (3) general fairness and procedural considerations.

561 F.Supp.2d at 573. The Court noted only a "handful" of courts have adopted the Rule 23 standards in overtime collective actions.

Unfortunately for Plaintiffs, the class was simply too diverse. The Court found that Plaintiffs moved away from their theory that the position was misclassified and toward a theory based on misclassification on an individual basis. The Court stated "it became obvious that [the Court] could not draw any reliable inferences about the job duties of Plaintiffs as a class." 561 F.Supp.2d at 587.

The citation is Johnson v. Big Lot Stores, Inc., 561 F.Supp.2d 567 (E.D.La June 20, 2008).

Judge McBryde of the Northern District of Texas has developed a reputation for having great disdain for litigants who present “conclusions” as “facts.” Songer v. Dillon Resources, Inc. is no exception. Here, the Judge denied the motion for class certification of twenty-four truck drivers. Specifically, the Judge stated that the following are conclusions, not facts:

All drivers for Sunset and Dillon are working overtime because anyone who fails to complete an assigned delivery will lose his minimum guarantee in a later week where there is no work.
At no time has the company ever converted the drivers' pay per load into a regular hourly rate, and then paid for the hours in excess of forty (40) at one and a half times this rate.

Because the plaintiffs presented “primarily conclusory allegations unsupported by any factual assertions demonstrating the basis of the affiants' knowledge” the plaintiffs were held to have failed to make the threshold showing required for class certification.

Class certification is left to the discretion of the trial court; most trial courts would probably not have reached the same result.

The citation is: Songer v. Dillion Resources, LLC, --- F.Supp.2d ----, 2008 WL 2901324 (N.D.Tex. July 24, 2008).

The Court denied Rule 23 certification of state overtime claims where the putative class involved “every exempt RHI employee in Massachusetts regardless of job title or office location based on a Handbook that explicitly gives managers discretion.” The Court found that common questions of fact and law would not exist in such a diverse class. The Court had previously denied a Section 216(b) motion for conditional class certification.

The citation is O'Donnell v. Robert Half Intern., Inc., 250 F.R.D. 77 (D.Mass. 2008)

In Delpin Aponte v. U.S. the Court reject plaintiffs' attempts to expand the class from Puerto Rico postal workers to all United States postal workers. The Court cited the extensive discovery that had already taken place and the lack of any existing plaintiffs from outside Puerto Rico.

The Court also opines on the nature of the "regular rate" of pay.

The citation is Delpin Aponte v. U.S., --- Fed.Cl. ----, 2008 WL 3844733 (Fed.Cl. August 14, 2008).

In Sjoblom v. Charter Communications, LLC, the Court certified a class of broadband internet installers who claims unpaid overtime stemming from off-the-clock work.

The installers were given vehicles to driver for work. These vehicles were also used for personal use. As a result, installers would unload vehicles at home after work and reload them the next day before work. This time was uncompensated.

The citation is: Sjoblom v. Charter Communications, LLC, --- F.Supp.2d ----, 2008 WL 3582633, (W.D.Wis. Mar. 4, 2008).

Molina v. First Line Solutions LLC, involved customer engineers who worked on ATMs, point-of-sale, and imaging equipment. The plaintiffs claimed they were owed pay, including overtime, for off-the-clock and on call work.

Defendants raised the motor carrier exemption regarding overtime claims that occurred before a 2005 change to the Motor Carrier Act. This change narrowed the scope of the DOT's jurisdiction over motor carriers. Under the Motor Carrier exemption, workers under the jurisdiction of the DOT are exempt from the FLSA. Part of plaintiffs' job duties was to deliver equipment.

The Court held that the changes to the Motor Carrier Act were effective the day the legislation passed, i.e. August 10, 2005, not the date of the government's new fiscal year, i.e. October 1, 2005.

Plaintiffs argued that promissory estoppel and waiver prevented defendants from raising a FLSA exemption where defendants had told plaintiffs they were non-exempt. The Court concluded that plaintiffs had failed to meet their burden to show either of these defenses (or replies) to the affirmative defense.

Because the Motor Carrier exemption applies when workers are in interstate commerce, the Court considered how frequently plaintiffs had to be in interstate commerce to trigger the exemption. The Court applied DOL and DOT regulations that workers are subject to the Motor Carrier act for four months after each proven incident of transporting a shipment in interstate commerce.

The Court also distinguished state law claims. Illinois wage law requires that for the Motor Carrier exemption to apply, the defendant employer must be a motor carrier. Therefore, state law claims for unpaid overtime are not limited to after August 10, 2005.

The Court then turned to the issue of class certification. The Court had little trouble authorizing a FLSA opt-in action. The Court, however, did not authorize a Rule 23 opt-out action for state law claims. The Court found that state law claims, not FLSA claims, would dominate the action. Those who opt-in under Section 216(b), however, would be allowed to pursue their state claims.

The Court modified the notice in accordance with the order.

The citation is: Molina v. First Line Solutions LLC, --- F.R.D. ----, 2007 WL 4404330 (N.D.Ill. June 28, 2007).

The Eastern District of New York has certified a class of Dominio's Pizza delivery drivers. The case alleges that drivers were not paid for all hours worked.The Court followed the standard two-step process for FLSA class certification.

The fact that one employee also alleged that he was forced to reimburse money did not destroy the similarly situated nature of the class. Nor did the fact that one plaintiff was a customer service rep as well as a driver prevent a finding of similarly situatedness.

The Court also allowed the plaintiffs to file additional affidavits after the motion for class certification was filed.

Although the Court certified the class of drivers at the location where the plaintiffs were employed, the Court refused to certify additional drivers at a location from which there were no affidavits supporting the motion.

The Court also addressed the issue of what constitutes sufficient notice. The Court did not change the notice other than to limit the description of the class to drivers at the one store location and exclude from the class notice mention of one plaintiff's unique claim of unlawful reimbursement.

The citation is Laroque v. Domino's Pizza, LLC, 557 F.Supp.2d 346 (E.D.N.Y. May 30, 2008).

The dispute in this case sounds familiar: plaintiff claimed she was improperly classified as exempt because she primarily performed sales functions, and did not customarily and regularly supervise two full-time employees or their equivalent. Plaintiff also claims that the Body Shop failed to credit or compensate her for work duties which she performed off the clock.

Plaintiff, joined by several dozen opt-ins, moved for class certification. Interesting, the Court only mentions the two-step certification process.

Defendant attempts to defeat certification arguing that plaintiff has not shown that other Shop Managers primarily engaged in sales activities. The Court finds that whether plaintiffs are similarly situated isn't the real question; the question is whether plaintiffs subject to a common practice or scheme. What this really means, in turn, is that the fundamental allegation of the plaintiffs has to be the same.

The Court states:

While there will undoubtedly prove to be variances among the putative class members concerning their duration of employment, the extent to which they performed non-managerial functions, and the percentage of time, if any, that they supervised fewer than eighty subordinate hours per week, plaintiff's fundamental allegation is that defendant denied overtime wages to a number of Shop Managers, by classifying them as exempt even though their duties and supervisory responsibilities fell short of the requirements of the FLSA's executive exemption. As such, the class members are “similarly situated with respect to their allegations that the law has been violated,” and preliminary certification is appropriate.

The Court modified the notice slightly to clarify the class.

In addition to a mailed notice, the Court also ordered a notice posted on the employer's common area bulletin boards. However, the Court declined to order email notice or notice in the company newsletter.

The case is Rubery v. Buth-Na-Bodhaige, Inc., --- F.Supp.2d ----, 2008 WL 3188769 (W.D.N.Y. August 8, 2008).

In Davidson v. RGIS Inventory Specialists, plaintiffs originally filed a collective action on behalf of a putative nationwide class. Although a class was certified, it was limited to one location. While the original case continues, workers brought a brand new second, lawsuit with nearly identical claims on behalf of a putative nationwide class. Defendant moved to dismiss and plaintiff amended to clarity that she did not seek national certification but rather certification of a different location.

First, the Court ruled that under Rule 15, Plaintiff could amend her complaint without leave. A motion to dismiss is not a "pleading" that would extinguish a plaintiff's right to amend as a matter of course.

Second, the Court ruled that plaintiff was not collaterally estopped by the decisions of the first action from bringing the second action. The Court notes that collateral estoppel requires finality, and the decision not to certify certain offices in the first suit is not a final decision. A decision of class certification is not an appealable, final judgment. Thus the plaintiff could continue with her action.

The citation is: Davidson v. RGIS Inventory Specialists, 553 F.Supp.2d 703 (E.D.Tex. Feb. 23, 2007).

In Jirak v. Abbott Laboratories, Inc., Judge Ruben Castillo certified a class of pharmaceutical representatives. Defendants opposed certification arguing that there is no common scheme or plan. The Court, however, found that Reps had the same essential job duty and were all commonly not paid overtime.

Defendants also sought revisions to the class notice. The Court removed the heading from the notice so that the Court did not appear to be endorsing the action. The notice also had to state that the Court had not taken a position and that the Court should not be contacted. Otherwise, the proposed notice was permitted.

The full citation is: Jirak v. Abbott Laboratories, Inc., --- F.Supp.2d ----, 2008 WL 2812553 (N.D.Ill. July 22, 2008).

My search for new published overtime cases depends on the speed with which electronic indexing systems identify cases. The class certification order in Vondriska v. Premier Mortg. Funding, Inc. is over a year old, but it appeared today for the first time as a published case. As there are no other published FLSA cases today, Vondriska bears revisiting.

Vondriska was brought by friends of the firm Paul Lucas and Don Nichols. This case illustrates a straightforward application of the Lusardi standard for conditional class certification.

The case involves the alleged misclassification of loan officers. Defendant argued that the decision whether an employee is salary or hourly occurs on the branch office level. Thus the the employer contends there is no common plan at issue to justify certifying multiple branches. Branches also assigned different titles and slightly varying job duties. While the class consisted of loan officers paid by commission, the commissions varied from branch to branch.

The Court is unconvinced by defendant's argument. Minor variations in job duties are insufficient to defeat conditional class certification. The Court notes that the Eleventh Circuit does not require a common plan or scheme.

The Court also addressed issues of the proposed notice. Because potential class members had varying job titles, the Court authorized notice to those whose “primary duty was selling or originating loans inside the branch office.” The parties were ordered to confer further on the issue of the notice.

The full citation is Vondriska v. Premier Mortg. Funding, Inc., --- F.Supp.2d ----, 2007 WL 5314991 (M.D.Fla. May 10, 2007).