 Another District Court Allows “Hybrid” Class/Collective Acton to Proceed
March 13th, 2011 Federal district courts outside of the Third Circuit continue to reject corporate defendants’ arguments that FLSA collective actions cannot proceed simultaneously with Rule 23 class action claims alleging violations of state overtime laws. Most recently, in Hendricks v. Total Quality Logistics, LLC, 1:10-cv-00649-SJD, Chief Judge Susan J. Dlott of the Southern District of Ohio refused to dismiss a class action claim under the Ohio Minimum Fair Wage Standards Act and, in so doing, regognized that requiring an FLSA plaintiff to commence a second lawsuit in order to pursue his state law class claim simply makes no sense. Tags: FLSA hybrid actions; Ohio overtime; Ohio overtime law; Ohio Minimum Fair Wage Standards Act ---------------------------------------------------------------------------------------- Middle District of Pennsylvania Denies Defendant’s Motion for Summary Judgment in Dollar General Store Manager Misclassification Case. February 28th, 2011 Judge Munley of the Middle District of Pennsylvania recently denied a Defendant’s motion summary judgment in a case where a Store Manager alleged violations under the Fair Labor Standards Act (FLSA). In Pierce v. Dolgencorp, Inc., 2011 U.S. Dist. LEXIS 10624 (M.D. Pa. Feb. 3, 2011), a former Dollar General Store Manager alleged that she was misclassified as an exempt employee and therefore wrongfully denied overtime compensation. Judge Munley noted, after viewing the evidence in the light most favorable to Plaintiff, that Ms. Pierce worked 50 to 60 hours per week, interviewed and hired 14 employees, trained employees, disciplined employees, and scheduled employees’ hours. Indeed, during a deposition Plaintiff had testified that she was the leader of her store. Nonetheless, questions of fact remained as to three factors determinative under federal law as to whether Plaintiff was properly classified as exempt in her position as a Store Manager: 1) the amount of time spent on managerial duties; 2) relative importance of managerial and non-managerial duties; and 3) relative salaries paid to employee as compared to non-exempt employee. Judge Munley noted that despite Plaintiff’s job title as a Store Manager, Plaintiff testified that she spent 50% of her time performing manual labor. Also, on “truck days” – which occurred two times a week, Plaintiff would spend 75% of her day unloading and inventorying. Regarding the second factor in dispute, Judge Munley noted that because the store refused to grant Plaintiff more hours to give to other non-exempt employees to perform manual labor, and instead made Plaintiff perform such work instead as a Store Manager, a reasonable juror could conclude that Defendant most valued Plaintiff’s manual labor. Accordingly, as the facts of this case demonstrate, it is a very fact-intensive, as well as legal, analysis as to whether an employee with the title of Store Manager is properly classified as exempt from the overtime laws by his or her employer. Tags: Assistant Store Manager Misclassified, Fair Labor Standards Act, FLSA, overtime compensation, Pennsylvania overtime attorney, Store Manager, Store Manager Misclassification ---------------------------------------------------------------------------------------- Eastern District of New York Denied Home Depot’s Motion for Summary Judgment in Assistant Store Manager Misclassification Case February 28th, 2011 Judge Mauskopf, a judge in the Eastern District of New York, recently denied Home Depot’s motion for summary judgment in an individual case on behalf of an Assistant Store Manager alleging overtime violations under New York law. In Clougher v. Home Depot U.S.A., Inc., 696 F. Supp. 2d 285, 288 (E.D.Y. 2010), Mr. Clougher brought claims under the New York Labor Law alleging that he was wrongfully classified as exempt and not paid any overtime. As an Assistant Store Manager, Mr. Clougher worked at two different Home Depot Stores in New York over a period of four years. He allegedly worked a minimum of 55 hours per week and spent no more than 20% of his time performing managerial tasks. As an Assistant Store Manager, Mr. Clougher said that he spent most of his time stocking shelves, unloading trucks, working at a cash register, sweeping floors, assisting customers, and working alongside other customers. Home Depot, on the other hand, claimed that as an Assistant Manager Mr. Clougher worked in an “executive” position and therefore sought summary judgment on the grounds that he was not entitled to overtime on the basis of his status as a bona fide executive. The court denied Home Depot’s motion for summary judgment and noted that the question as to whether one is exempt as an executive requires a “highly fact-intensive inquiry” and moreover noted that in many cases days of trial testimony were needed to reach such a conclusion. Although in this case there were 2 depositions of the plaintiff, that was simply insufficient for the court to make the proper determination as to whether Mr. Clougher’s job as an Assistant Store Manager was an exempt or non-exempt position. The Court held that Home Depot had not met its “strict burden of establishing [Plaintiff’s] bona fide executive status as a matter of law.” Tags: Assistant Manager Misclassification, Assistant Manager Overtime, Assistant Store Manager Overtime, bona fide executive, executive exemption to overtime, New York Labor Law, New York overtime law, overtime violations ---------------------------------------------------------------------------------------- Southern District of New York Court Grants Conditional Certification to CVS Assistant Store Managers February 28th, 2011 In a recent 2010 decision from the Southern District of New York, Cruz v. Hook-SupeRx,L.L.C., 2010 U.S. Dist. LEXIS 81021 (S.D.N.Y. Aug. 5, 2010), Judge Crotty granted conditional collective action certification to a group of current and former Assistant Store Managers at CVS. The Assistant Managers hailed from six states: Pennsylvania, New Jersey, New York, Massachusetts, Michigan, and North Carolina. Conditional collective certification was granted pursuant to the Fair Labor Standards Act (FLSA) which allows employees to not only sue on their own behalf but also on behalf of other employees who are “similarly-situated.” Plaintiffs alleged that they were improperly classified as executives and wrongfully denied any overtime compensation. Judge Crotty noted that Plaintiffs burden at this stage was minimal and that “[a] modest factual showing is sufficient to demonstrate that Plaintiffs and potential Plaintiffs were victims of a common policy or plan that violated the law.” Indeed, the Court found very persuasive declarations of Assistant Store Managers in over 9 states which showed that CVS stores were all controlled by a corporate office; that Assistant Store Managers were required to participate in a uniform training program; and that the Assistant Managers were performing many non-exempt duties: shelving merchandise, unpacking boxes, loading and unloading trucks, helping customers and working a cash register. Moreover, the Assistant Managers did not regularly hire or fire other employees. Judge Crotty granted Plaintiffs’ motion for conditional collective action certification and also authorized court notice to go out to other Assistant Store Managers eligible to join the case. This case demonstrates that the standard for initially certifying a class pursuant to the FLSA is indeed a low hurdle for overtime and wage attorneys to meet. Thus, overtime and wage attorneys in Pennsylvania, New Jersey, and New York should be cognizant of possible claims that Assistant Managers may have for denied overtime compensation. Tags: Assistant Manager Misclassification, Assistant Manager Overtime, Assistant Store Manager Misclassified, Assistant Store Manager Overtime, collective action, Fair Labor Standards Act, FLSA, New Jersey overtime attorneys, New York Overtime Attorneys, overtime and wage attorney, overtime compensation, overtime violations, Pennsylvania overtime attorneys ---------------------------------------------------------------------------------------- Defendant’s Motion to Strike Two Consent Forms in Assistant Manager FLSA Case Denied February 28th, 2011 In Rose v. Wildflower Bread Co., the United States District Court for the District of Arizona denied a defendant’s motion to strike time-barred consent forms. 2011 U.S. Dist. LEXIS 5426 (D. Arix. Jan. 20, 2011). Plaintiff, an Assistant Manager at one of Defendant’s restaurants, filed a case on June 23, 2009 on her own behalf and on behalf of other Assistant Managers seeking recovery of unpaid overtime compensation. Defendant classified all of its Assistant Managers as exempt from the overtime requirements of the Fair Labor Standards Act (FLSA). Plaintiff alleged on behalf of all similarly situated Assistant Managers that they because they regularly performed physical or manual work, they were entitled to overtime pay. The Court granted conditional certification on May 4, 2010. Two former Assistant Managers, however, submitted their consent forms more than two years after they terminated their positions with Defendant. Accordingly, Defendant argued that the forms should be stricken. Under the FLSA, normally the statute of limitations for recovery of overtime compensation is two years; but, if a Defendant’s violation of the FLSA’s overtime provisions is deemed willful, the statute of limitations is three years. Defendant argued that because there had been no prior litigation as well as no prior audits by state or federal authorities, the statue of limitations could only be two years. The Court held, however, that it was premature before the close of discovery to determine whether Defendant’s alleged violations were willful and, therefore, denied Defendant’s motion to strike the Assistant Managers’ consent forms. Tags: Arizona overtime attorney, Assistant Manager, Assistant Manager Misclassification, Assistant Manager Overtime, Fair Labor Standards Act, FLSA, FLSA conditional certification, overtime compensation ---------------------------------------------------------------------------------------- California Court Grants Summary Judgment Against Hershey’s in Overtime Lawsuit February 28th, 2011 On February 23, 2011, the Northern District of California granted a partial summary judgment motion against Hershey Company by Retail Sales Representative (RSR). Campanelli v. Hershey Co., 2011 U.S. Dist. LEXIS 17483 (N.D. Cal. Feb. 23, 2011). The RSRs sought to have the court find that the outside sales and administrative exemptions to the federal Fair Labor Standards Act (“FLSA”) do not apply to their job duties. According to the Court, “RSRs are part of teams that help [Hershey] sell its products directly to retail outlets of various sizes, ranging from Walmarts to grocery chains to mom-and-pop stores. Each RSR services retail outlets in a designated sales territory.” Id. at *3. RSRs did not receive commissions, but had annual salaries between $40,000 and $50,000. Id. This case concerned slightly over 100 RSRs. The Campanelli court first examined the outside sales exemption to the overtime laws which requires a position to have the primary duty of making sales. Id. at *12. The court rejected the use of this exemption, stating that: “Here, defendant has not produced evidence that plaintiffs’ primary duties are “making sales” as contemplated by the regulations. Defendant concedes that its upper-level salespeople, such as CSEs, negotiate sale agreements — without any involvement from the RSRs — for the company’s products with customers’ corporate offices (i.e., Walmart, Safeway, Albertson’s, etc.). That is when the sale is recorded, and Hershey products are later shipped to the retailers. It is undisputed that plaintiffs then help stimulate sales by encouraging retailers to replenish their supply and ensuring that sold products are properly marketed at the retail stores. While this facilitates the movement of Hershey products from warehouses and stockrooms to the shelves of retail stores and into the hands of consumers, this does not constitute an additional ‘sale.’ The work done by plaintiffs may increase defendant’s sales, but it does not affect the plaintiffs’ own sales. Since plaintiffs are not the individuals making the actual sale as the exemption requires, this type of ‘incremental selling’ and ‘sell through,’ even if they were the plaintiffs’ primary duties, does not amount to exempt work.” Id. at *17-18. The Campanelli court similarly rejected the administrative exemption, primarily relying on Hershey’s failure to proffer evidence that the RSRs’ job duties were related to matters of significance. Id. at *32. The court further rejected the company’s contention that RSRs fell within the “combination” exemption which “allows employees to be classified as exempt if they perform a combination of outside sales and administrative duties, but their primary duty does not fit neatly into either exemption.” Id. at *34 (citing 29 C.F.R. § 541.708). Tags: administrative, Fair Labor Standards Act, FLSA, New Jersey, outside sales, overtime, Pennsylvania, representative, salary, Sales ---------------------------------------------------------------------------------------- 1,500 Individual Assistant Store Managers Cases Against Home Depot Following District of New Jersey Ruling February 28th, 2011 On February 15, 2011, Judge Peter Sheridan of the District of New Jersey decertified a conditionally certified class of Merchandising Assistant Store Managers (“MASMs”) in a lawsuit against home improvement giant Home Depot. See Aquilino v. Home Depot, U.S.A., Inc., 2011 U.S. Dist. LEXIS 15759 (D.N.J. Feb. 15, 2011). The assistant store managers in Aquilino alleged that they were misclassified as exempt from the overtime compensation requirements of the federal Fair Labor Standards Act (“FLSA”) because Home Depot only paid them a salary. “MASMs are the second-highest ranking employee in a Home Depot, subordinate only to the store manager. Each store employs between one and seven MASMs.” Id. at *5. Each MASM can potentially oversee several departments within each Home Depot location. When the case was conditionally certified, notice was sent out to approximately 12,728 workers, 1,502 opt-ed into the lawsuit. Id. at *4. The Aquilino Court provides a detailed analysis of the two step process in certifying a class pursuant to 29 U.S.C. § 216(b) within the Third Circuit. Id. at 16-17. At the initial or “conditional” certification stage, the “analysis occurs early in the litigation when the court only has minimal evidence; thus the analysis uses a ‘fairly lenient standard’ and usually results in the grant of conditional certification.” Id. “Once conditional certification is granted, notice is sent to the potential members of the collective action.” Id. “The secondary inquiry, commonly known as the ‘decertification stage,’ occurs later in the litigation when the case is readying for trial. If the defendant moves to decertify the conditional collective action, the court will again consider whether the plaintiffs are similarly situated to the remainder of the members of the collective action.” Id. (internal citations omitted). At the second stage, the burden is higher for the plaintiffs. The Aquilino Court detailed the three factors courts review at the decertification stage. Id. at *18. These are (1) the disparate factual and employment settings of the individual plaintiffs, (2) the various defenses available to defendants, and (3) the fairness and procedural considerations. Id. Upon reviewing each of these factors, the Court decertified the case finding that the nationwide class of MASMs was not similarly situated. The question now is: What will the plaintiffs and Home Depot do from here? When collective actions are decertified, the claims of opt-in members are dismissed without prejudice, which means they can re-file their cases elsewhere. The named plaintiff, however, will now proceed to trial before Judge Sheridan. As a result, instead of litigating Home Depot’s policy of classifying MASMs as exempt in one court, the company is now faced with potentially 1,500 individual suits in federal courts across the country. As has been seen in the lawsuits on behalf of store managers against Dollar General, this can lead to inconsistent rulings on whether a standardized position is exempt. Kind of makes you think that corporate America should be careful what they wish for when moving to decertify these cases. Tags: Assistant Manager, Assistant Store Manager, Fair Labor Standards Act, FLSA, Home Depot, Misclassified, New Jersey, overtime, overtime exempt, Pennsylvania, salary ---------------------------------------------------------------------------------------- Recent Tennessee Decision Reiterates that Store Managers can be Entitled to Overtime Pay February 28th, 2011 I just read a November 18, 2010 decision by Middle District of Tennessee Judge Aleta A. Trauger denying Dollar General’s motion for summary judgment in an FLSA case in which a store manager alleged that she was entitled to overtime pay. Like judges in similar cases, Judge Trauger emphasized that the “store manager: job title alone does not render an employee overtime-exempt. In courthouses accross the country, retail and banking managers and assistant managers continue to foght for their overtime rights and to allege that they have been misclassified as exempt from federal and state overtime laws. These cases are especially compelling when the misclassified employee is merely the assistant manager of a store or bank. Our firm handles many such cases. For example, working with co-counsel, we represent over 1,000 assistant managers currently and formerly employed by the Rite Aid drug store chain. We also represent hundreds of assistant branch managers employed by Citizens Bank. Tags: Store manager overtime; assistant store manager overtime; retail manager overtime; Tennessee overtime lawyer; Tennessee overtime attorney; Dollar General overtime; Rite Aid overtime; Citizens bank ove ---------------------------------------------------------------------------------------- A Few Cases Stating that Employee Rights Under the Pennsylvania Wage Payment and Collection Law Can be Predicated in Violations of the Pennsylvania Minimum Wage Act February 28th, 2011 In several cases, Pennsylvania companies and their lawyers have convinced judges to hold that the Pennsylvania Wage Payment and Collection Law (“PWPCL”) does not give employees any wage or overtime rights beyond those for which the employer is contractually obligated (through either a written or oral contract) to pay. Notably, however, a few Courts have disagreed with this interpretation of the PWPCL and have held that, even in the absence of a written or oral contract, a PWPCL violation can be predicated entirely on an employer’s violation of the overtime rights provisions of the Pennsylvania Minimum Wage Act (“PMWA”). These cases include Lugo v. Farmers Pride, Inc. 967 A.2d 963 (Pa. Super. 2009), and Zebroski v. Gouak, 2009 U.S. Dist. LEXIS 81817 (E.D. Pa. Sept 9, 2009). Lugo concerned the overtime rights of Pennsylvania food processing employees, while Zebroski concerned the overtime rights of waitresses and other restaurant employees. Tags: Pennsylvania Minimum Wage Act; Pennsylvania overtime law; Pennsylvania overtime rights; Pennsylvania wage law; Pennsylvania wage rights; Pennsylvania Wage Payment and Collection Law; Pennsylvania over ---------------------------------------------------------------------------------------- Denial of Summary Judgment in Another Independent Contractor Case February 28th, 2011 The cases in which workers allege that companies misclassify them as independent contractors continue to mount up. On January 31, 2011, a Californis appellate court held that a trucking company could not get summary judgment against a truck driver who alleged that he had been misclassified as an independent contractor. The case is entitled Arzate v. Bridge Terminal Transport, Inc., and it can be found at 192 Cal. App. 4th 419. Our office, like many Montgomery County, Philadelphia-area, and Pittsburgh-area wage and overtime lawyers and attorneys, represents delivery drivers who have been denied overtime and other wage rights becausee the boss misclassified them as independent contractors. Tags: Pennsylvania deliver driver overtime; independent contractor overtime; Montgomery County overtime lawyer; Montgomery County overtime attorney; wage lawyer; wage attorney; Montgomery County wage lawyer |
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