When an employer settles a collective action lawsuit under the Fair Labor Standards Act (FLSA), may the settlement agreement also include a release of any rights to overtime pay which the plaintiffs may have under state law? In Wells Fargo Wage and Hour Employment Practices Litigation, MDL No. H-11-2266 (S.D. Tex. May 12, 2014), the court answered that question with a clear “yes.”
In Stiller v. Costco Wholesale Corp., No. 3:09-cv-2473-GPC-BGS, Plaintiffs Eric Stiller and Joseph Moro alleged that Costco’s loss-prevention closing procedures effectively “forced” employees to work off-the clock without getting paid because they were required to remain on-site after they had clocked out of their shifts to go through security screenings. In December 2010, the district court certified a California-wide class finding that common questions predominated because Costco employed a centralized policy which applied to all employees. However, on April 15, the Court decertified the class finding that the purportedly “common” question of whether Costco had a “de facto policy of detaining employees in warehouses during closing procedures without pay” would only determine whether “employees were sometimes detained without pay as a result of the alleged policy.” Costco’s liability would still hinge on individualized determinations as to “whether, how often, and for how long [individual] class members actually experienced unpaid [off-the-clock] time.”
In its recent per curiam opinion in Rea v. Michaels Stores, Inc., the U.S. Court of Appeals for the Ninth Circuit clarified rules and procedures relevant to defendants seeking to remove cases to federal court.
American Conference International (ACI)
21st National Forum on Wage and Hour Claims and Class Actions
May 29-30, 2014
New York Marriott East Side Hotel * New York, NY
Laura Reathaford has been invited to speak on a panel titled “Donning and Doffing & Walking Time Allegations, and the Latest Claims Arising from Meal and Rest Breaks.” This premiere conference features two days of programming related to best practices and developing law related to wage and hour claims.
As we recently reported here, there have been a number of appellate decisions ordering class certification based on the existence of an employer’s companywide policy – all while overlooking numerous individualized questions that would undoubtedly create manageability problems during trial. On December 30, 2013, the California Court of Appeal in Johnson v. California Pizza Kitchen, Inc., 2013 WL 6858373 (Cal. App. 2 Dist. Dec. 30 2013) anticipated these trial management issues and upheld the trial court’s decision denying class certification.
Shortly after the California Supreme Court issued its 2012 decision in Brinker Restaurant Corp. v. Superior Court, employers saw an immediate uptick in appellate court decisions supporting the denial of class certification to plaintiffs in wage and hour lawsuits.
In Chavarria v. Ralphs Grocery Co., No. 11-56673, 2013 WL 5779332 (9th Cir. Oct. 28, 2013), the plaintiff, a former deli clerk, brought a class action against Ralphs for various alleged wage and hour violations of the California Labor Code. As a condition of employment, Chavarria signed an arbitration agreement containing a class action waiver. Ralphs filed a motion to compel arbitration.
In its recent decision in Scott v. Family Dollar Stores, Inc., No. 12-1610 (4th Cir. Oct. 16, 2013), the Fourth Circuit ruled that the district court abused its discretion by refusing to allow plaintiffs asserting claims of gender-based pay discrimination leave to file an amended complaint based upon an erroneous interpretation of the Rule 23(a) commonality requirements for class certification set forth by the United States Supreme Court in Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011). In a 2-1 decision, the majority held that plaintiffs should have been permitted to amend their complaint to challenge discretionary decision making by managers on a nationwide class, reasoning that “the discretionary authority at issue was exercised by high-level managers, as distinct from the low-level type managers in Wal-Mart.” As the dissent argued, this ruling is in tension with Wal-Mart and other courts that have held when discretionary management decisions are involved, the appropriate unit of analysis must be the discretionary decision maker.
Frank Moreno agreed, as a condition of his employment with Sonic-Calabasas A, Inc., to arbitrate all of this employment disputes with his employer. After terminating his employment with Sonic, Moreno filed an administrative wage claim with the Labor Commissioner for unpaid vacation pay. Filing such a claim is the first step toward obtaining a “Berman” hearing (an administrative dispute resolution forum designed to assist employees in recovering wages).
After the renowned remand from the California Supreme Court, the Hohnbaum plaintiffs in Brinker Rest. Corp. v. Superior Court, 53 Cal. 4th 1004 (2012) sought to certify meal period claims alleging that all California employees were denied meal periods because Brinker’s corporate meal period policies were unlawful.