Courts around the country have consistently held that declarations submitted by an employer on behalf of current employees are of little value in deciding whether a class should be certified.  This is because it should be of no surprise that these “Happy Camper” statements hold questionable value when they are obtained in the context of an employer-employee relationship.  Notably, the Southern District of Alabama in Longcrier v. HL-A Co, Inc., 595 F. Supp. 2d 1218 (S.D. Ala. Dec. 10, 2008) struck declarations obtained by a defendant where such statements were obtained in a manner that mislead and deceived the employees – employees who happened to also be potential class members.

Moreover, in determining whether potential class members are similarly situated or whether their claims are capable of classwide resolution, individual statements from employees created at the bequest of the employer have little value toward determining that issue.  For example, the Northern District of Ohio in Creely v. HCR Manor Care, Inc., 2011 U.S. Dist. LEXIS 61376 (N.D. Oh. June 9, 2011), a case involving inter alia overtime violations under the Fair Labor Standards Act (FLSA) and uninterrupted meal break violations, stated that it was not persuaded by 35 “happy camper” affidavits submitted by the defendant.  The court explained: “These affidavits are of little use at this juncture.  Just as courts have not traditionally required a plaintiff seeking conditional certification to come forward with some threshold quantity of opt-in plaintiffs [ . . . ] it is no more helpful for the employer to round up a small sample of favorable statements form employees.  [ . . . ]  While it is likely true that not all hourly employees will opt-in to the collective action, the Court’s function at this stage of conditional certification is not to perform a detailed review of individualized facts from employees hand-picked by [Defendant].”  Creely, 2011 U.S. Dist. LEXIS at **62-63.  See also Rindfleisch v. Gentiva Health Services, Inc., 2011 U.S. Dist. LEXIS 57949 (N.D. Ga. April 13, 2011).   In West v. Lowes Home Centers, Inc., the Western District of Louisiana granted conditional certification despite employer-obtained declarations stating that plaintiffs had not yet had the chance to depose the employees providing the declarations and further noted that such deposition testimony was not needed to support collective adjudication.  West, 2010 U.S. Dist. LEXIS 139737 (W.D. La. Dec. 16, 2010).

Companies will often argue that conditionally certifying classes under the FLSA is not appropriate because some discovery has occurred. However, courts often reject such arguments.
For example, in Bunyan v. Spectrum Brands, Inc., the Southern District of Illinois only abandoned the two-step conditional certification approach following over 15 months of discovery by the parties during which the plaintiffs acquired a list of potential class members. 2008 U.S. Dist. LEXIS 59278, *13 (S.D.Ill. July 31, 2008). Other courts have also reluctantly applied an intermediate analysis only after (i) significantly more discovery was completed compared to this case; or (ii) informal notice was sent to potential opt-ins by the plaintiffs. See Bouaphakeo v. Tyson Foods, Inc., 564 F. Supp. 2d 870, 894-901 (N.D. Iowa 2008) (applying an intermediate analysis only after 300 individuals had joined the case and 22 depositions had been conducted by the parties); Basco v. Wal-Mart, 2004 U.S. Dist. LEXIS 12441 (E.D. La. July 2, 2004) (applying the intermediate analysis after approximately five years of litigation including six amendments to the complaint and the plaintiffs moving for Rule 23 class certification); Williams v. Accredited Home Lenders, Inc., 2006 U.S. Dist. LEXIS 50653, *11-12 (N.D. Ga. July 25, 2006) (“The Plaintiffs short circuited the process first by disseminating informal notice of the lawsuit and the opportunity to opt-in. Without court supervised notice, about 150 current or former loan officers, have filed consent forms to opt-in as Plaintiffs. The Defendant then sought and obtained the Court’s permission to take depositions of about 20 of the opt-in Plaintiffs.”).

Second, Maryland district courts have noted that it is improper to move beyond the initial conditional certification stage analysis until after the completion of all discovery. See Mercado v. N. Star Founds., Inc., 2011 U.S. Dist. LEXIS 43229, *3-4 (D. Md. Apr. 21, 2011) (second stage occurs after completion of discovery); Syrja v. Westat, Inc., 756 F. Supp. 2d 682, 686 (D. Md. 2010) (“in the second stage following the conclusion of discovery”). This is consistent with other federal courts that have rejected the application of a more stringent analysis following the completion of similar limited initial discovery concerning conditional certification. See e.g. Helmert v. Butterball, LLC, 2009 U.S. Dist. LEXIS 116460, *23 (E.D. Ark. Dec. 15, 2009) (refusing to apply a heightened analysis prior to the close of merits discovery); West v. Border Foods, Inc., 2006 U.S. Dist. LEXIS 96963, *9 (D. Minn. June 12, 2006) (analyzing the plaintiff’s motion for conditional certification under the initial stage despite the exchange of interrogatories and document requests, and three depositions of employees of the defendant); Lyons v. Ameriprise Fin., Inc., 2010 U.S. Dist. LEXIS 98496, *8-9 (D. Minn. Sept. 20, 2010) (“As an initial matter, [the defendant] argues for a ‘heightened’ or ‘intermediate’ standard rather than the lenient standard typically applied at the first stage, since some discovery has been conducted. The Court rejects this suggestion.”) (internal citations omitted).

A motion for conditional certification was granted by the Eastern District of New York in late March under the Fair Labor Standards Act (FLSA) on behalf of approximately fifty (50) construction workers.  See Bohdan Klimchak v. Cardrona, Inc., 2011 U.S. Dist. LEXIS 30652 (E.D.N.Y. Mar. 24, 2011).  Plaintiffs alleged that they worked over forty hours per week without receiving overtime compensation and that they also failed to receive prevailing wage for work performed pursuant to governmental contracts.  The potential plaintiffs did construction work such as waterproofing, roofing, and sheet metal work.  Conditional certification was granted on the basis of four affidavits, two from the named plaintiffs and two from opt-in plaintiffs, stating that they and other workers were not paid overtime compensation and were also not paid prevailing wage. 

Judge Feuerstein noted in the opinion that for purposes of granting conditional certification, it was inconsequential whether all potential opt-in plaintiffs held the exact same job title:  “Moreover, parties may be similarly situated for purposes of Section 216(b) despite not occupying the same employment positions provided that they are all subject to the same unlawful policy or practice.  [ . . . ]  Thus, for example, if defendants had a policy or practice of not paying overtime compensation to any of its labourers, whether full-time or part-time, union member or non-union member, all of those employees would be similarly situated for purposes of this analysis.”   Lastly, the Court held that it was proper that notice go out to workers employed by defendants for the previous six years – even though notice was going out pursuant to the FLSA – as the Court had supplemental jurisdiction over New York state claims which provided for a statute of limitation of six years.

Conditional certification of a collective action under the Fair Labor Standards Act (“FLSA”) was recently granted in a New Jersey case involving approximately 100 employees who worked in the construction industry holding job titles such as hazardous abatement workers, demolition workers, and teamsters.  In Kristic v. J.R. Contracting & Environmental Consulting, et al., 2011 U.S. Dist. LEXIS 28121 (D.N.J. March 16, 2011) United States District Judge Peter Sheridan of the District of New Jersey held that conditional certification was proper where the approximately 100 hourly employees were similarly situated and were  not paid overtime compensation for working over forty (40) hours per week.  Judge Sheridan granted conditional certification despite the presence of signed arbitration agreements on behalf of some of the construction workers and held that Defendant’s Motion to Dismiss was procedurally improper.  Thus, New Jersey overtime lawyers should not automatically assume that the presence of an arbitration agreement necessarily precludes a plaintiff from seeking relief in federal court, notably an order granting conditional certification under the FLSA.  In granting conditional certification, the Court noted that four plaintiffs claimed, apparently based on their general recollection and routine, that they worked 8 to 10 hours per day.  Plaintiffs also sued two individual officers of defendant for the overtime violations alleging that the officers not only controlled the company but also controlled payment of the employees’ compensation.   Lastly, plaintiffs also sought to recover payment for wages and benefits allegedly owed to them as the result of working on publically-funded contracts – apparently a claim for payment of what is sometimes referred to as the “ prevailing wage.”

Judge William J. Martini of the United States District Court for the District of New Jersey issued an opinion on July 31, 2009 conditionally certifying the FLSA claims of Liberty travel, Inc. travel agents who seek full overtime wages.  The decision can be found on LEXIS at Bredbenner v. Liberty Travel, Inc., 2009 U.S. Dist. LEXIS 67122 (D.N.J. July 31, 2009).  Therein, the district court rejected Liberty Travel’s claim that any analysis of its use of the Fluctuating Workweek Method (“FWW”) method of overtime calculation involved too many “individualized” issues to justify conditional certification.  Not surprisingly, Liberty Travel’s “individualized issue” argument emphasized the FWW’s “clear mutual understanding” requirement.  The Judge refused to take the bait, reasoning that Liberty’s “clear mutual understanding” argument involved merits issues not properly before the court at the conditional certification stage.  Rather, according to the Judge, what mattered at the conditional certification stage was the fact that Liberty Travel FWW scheme applied to all the travel agents.

This decision comes as no surprise to us at The Winebrake Law Firm.  Several years ago, our overtime attorneys obtained both conditional and second-stage certification in a FWW case on behalf of Ohio and Pennsylvania retail employees seeking full overtime pay from Lowe’s Home Centers, Inc.  The certification decisions can be found at: Evans v. Lowe’s Home Centers, Inc., 2006 U.S. Dist. LEXIS 32104 (M.D. Pa. May 18, 2006); Evans v. Lowe’s Home Centers, Inc., 2004 U.D. Dist. LEXIS 32104 (M.D. Pa. July 17, 2004); and Smith v. Lowe’s Companies, Inc., 2005 U.S. dist. LEXIS 9763 (S.D. Ohio May 11, 2005).

Companies opposing conditional certification in FLSA overtime cases often argue that, even if conditional certification is granted and notice is issued to the class, the notice mailing should be limited to class members who have been employed within two – rather than three – years from the notice date.  This argument is premised on the fact that, under the FLSA, a three-year limitations period applies only if the company engaged in a “willful” violation of the FLSA.  This argument frequently is rejected by district courts.  As recently explained by Judge Thomas Vanaskie of the United States District Court in Scranton, Pennsylvania, FLSA notice forms should be based on the three-year limitations period because the question of the company’s “willfulness” is a merits issue that is not properly before the court at the conditional certification stage.  See Gallagher v. Lackawanna Cty., 2008 U.S. Dist. LEXIS 43722, *30-31 (M.D. Pa. May 30, 2008).  This approach is consistent with the overwhelming majority cases, including the following decisions from district courts in Connecticut, Arkansas, Missouri, California, and Pennsylvania.  See, e.g., Neary v. Metro. Prop. & Cas. Ins. Co., 517 F. Supp. 2d 606, 623 (D. Conn. 2007); Resendiz-Ramirez v. P&H Forestry, LLC, 515 F. Supp. 2d 937, 942 (W.D. Ark. 2007); Fast v. Applebees Int’l, Inc., 2007 U.S. Dist. LEXIS 44365, *12-13 (W.D. Mo. June 19, 2007); Agdipa v. Grant Joint Union High Sch. Dist., 2007 U.S. Dist. LEXIS 26506, *7 (E.D. Cal. Apr. 10, 2007); Romero v. Producers Dairy Foods, Inc., 235 F.R.D. 474, 484 (E.D. Cal. 2006); Chabrier v. Willmington Finance, Inc., 2006 U.S. Dist. LEXIS 90756, *11 (E.D. Pa. Dec. 13, 2006).

When companies oppose FLSA conditional certification motions in collective actions seeking unpaid overtime, they often argue that the proposed FLSA class is not “similarly situated” because the class members work in different departments of the plant or work at different job sites.  These arguments generally are intended to scare the court into believing that that collective litigation would be unmanageable.

In response to the above argument, Trial Lawyers should argue, among other things, that “subclassing” often enables the trial judge to efficiently manage FLSA classes consisting of different groups of class members.  Below, you will find citations to decisions in which the district court recognized the benefits of subclassing in granting FLSA conditional certification motions.  The decisions arise out of district courts in Texas, Illinois, Kansas, New York, Mississippi, Kentucky, Virginia, Pennsylvania, and Colorado.

Ryan v. Staff Care, Inc., 2007 U.S. Dist. LEXIS 49060, *13 n.3 (N.D. Tex. July 6, 2007) (while differences in employees’ pay classifications might demonstrate “the need for subclassing in this case,” such differences did not warrant denial of conditional certification) (more…)