6. Other Rulings On Class And Collective Action Motions An employer with a legally-sound argument for defeating the merits of wage and hour claims asserted against it may choose, after failing to fracture a class or collective action or as an alternative, to attack the merits of the plaintiff ’ s claims at summary judgment or at trial. In 2023, this approach led to some substantial victories for employers, although the risk that the plaintiff can also prevail on summary judgment or at trial should reinforce the inherent risks presented when proceeding to the merits of wage and hour litigation. Wage and hour cases, like all litigation, present the “rubber meets the road” scenario whereby the plaintiff must ultimately prove the allegations asserted in a complaint or risk facing summary judgment on the asserted claims. The failure to do so is aptly demonstrated by Garnelo, et al. v. Yellowstone Landscape- Central, Inc., 2023 U.S. Dist. LEXIS 104049 (S.D. Tex. June 15, 2023). The plaintiffs, a group of temporary employees hired to provide lawn care services, filed a collective action alleging that the defendant failed to pay overtime compensation in violation of the FLSA. The defendant implemented a timekeeping system to track employees’ work hours and ensure FLSA compliance. The plaintiffs asserted that the defendant had constructive and actual knowledge of improper posting and computing of their work hours, which resulted in unpaid overtime. The defendant filed a joint motion for summary judgment and to deny class certification. The defendant argued that the plaintiffs failed to provide evidence that they worked more than 40 hours a week without receiving overtime pay. The court granted the defendant ’ s motion for summary judgment on the grounds that the plaintiffs had failed to provide sufficient evidence to support their FLSA claims, including evidence that the defendant had constructive or actual knowledge of the alleged FLSA violations. Accordingly, the court granted the defendant ’ s motion for summary judgment. Hernandez, et al. v. Plastipak Packaging, Inc., 2023 U.S. App. LEXIS 1665 (11th Cir. Jan. 23, 2023), demonstrates that a defensible payment scheme that satisfies the FLSA ’ s minimum payment provisions will not violate the FLSA, even if the plaintiff can demonstrate an alternative payment structure that results in higher pay. In that case the plaintiff filed a collective action alleging that the defendant failed to pay the correct overtime compensation rate in violation of the FLSA. The district court granted the defendant ’ s motion for summary judgment. On appeal, the Eleventh Circuit affirmed the district court ’ s ruling. The plaintiff worked a varied schedule each week, and the defendant calculated any overtime hours owed using the fluctuating workweek method. The plaintiff received $1,965 every other week, plus performance bonuses, holiday pay, and nightshift pay. The fluctuating workweek method accounts for the fact that when an employee works variable hours for a fixed weekly salary his regular rate of prorated hourly pay also varies. The Eleventh Circuit explained that an employer may satisfy the FLSA by: (i) dividing weekly salary by the total number of hours worked to calculate the employee ’ s regular hourly rate for that week; then (ii) multiplying one-half that rate by the number of overtime hours the employee worked that week. The defendant divided the plaintiff ’ s weekly salary by 40 hours, not the total number of hours he worked that week and multiplied his overtime hours by the full regular rate. Accordingly, the defendant actually paid above the standard overtime compensation rate, and the defendant ’ s method would always result in an overtime rate more than twice what the standard fluctuating workweek method would produce. Id. at *3. The plaintiff argued that the district court erred when it found the parties had a clear mutual understanding that his base salary was fixed regardless of the hours he worked in a given week. However, the Eleventh Circuit found that the plaintiff clearly agreed to the defendant ’ s salary policy, which stated plainly that he would “be paid a fixed weekly salary for a fluctuating workweek.” Id. at *4. The plaintiff also argued that the defendant ’ s more generous fluctuating workweek method violated the FLSA because it effectively denied him an overtime pay rate greater than his regular rate of pay. Id. at *5-6. The Eleventh Circuit stated that the FLSA maintains a floor, not a ceiling, and that pursuant to the regulation, an employer ’ s overtime rate must be “not less than” the one set by Congress. Id. at *6. Accordingly, the Eleventh Circuit affirmed the district court ’ s ruling. Where a challenged company policy applies to all putative collective action members, decertification may not be feasible, but a defendant may choose to seek summary judgment and obtain a successful result on
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Wage & Hour Class And Collective Action Review – 2024
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