Spencer v. Mental Health Resources, Inc.

Filing 28

ORDER by District Judge Margaret I. Strickland granting 19 Plaintiffs Motion for Step-One Notice Pursuant to the Fair Labor Standards Act. Plaintiff shall meet and confer with Defendant, and file an updated Proposed Notice by August 15, 2022. (ke)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
COURTNEY SPENCER,
Plaintiff,
v.

Civ. No. 1:21-cv-00121 MIS/JHR

MENTAL HEALTH RESOURCES, INC.,
Defendant.
MEMORANDUM OPINION AND ORDER
THIS MATTER is before the Court on Plaintiff’s Motion for Step-One Notice
Pursuant to the Fair Labor Standards Act. ECF No. 19. Defendant responded to Plaintiff’s
Motion, and Plaintiff filed a reply. ECF Nos. 23, 27. Having considered the parties’
submissions, the record, and the relevant law, the Court will grant the Motion. Plaintiff has
shown there are substantial allegations that the putative collective1 members were
together the victims of a single decision, policy, or plan, and the Court therefore finds that
the Complaint, ECF No. 1, satisfies the requirements for conditional certification.
BACKGROUND
This case concerns claims brought by Plaintiff, Courtney Spencer, against
Defendant Mental Health Resources, Inc., for violation of the Fair Labor Standards Act
and the New Mexico Minimum Wage Act. ECF No. 1 at 2. Plaintiff, who was formerly
employed by Defendant as a “CareLink NM Health Home Care Coordinator” (“Care
Coordinator”), asserts that Defendant subjected her and other salaried Care Coordinators

1 This Motion concerns certification of the collective action, but the case law does not always
distinguish, as “the terms ‘collective action’ and ‘class action’ are often used interchangeably when referring
to FLSA claims brought on behalf of a group of those similarly situated.” Martin v. Tap Rock Res., LLC,
2020 WL 2129598, at *2 (D.N.M. May 5, 2020).

to a misclassification scheme which resulted in their being improperly unpaid for regular
overtime work. ECF No. 1 at 2; ECF No. 19 at 1.
Defendant is a non-profit mental health agency that provides case management
services to mentally disabled individuals. ECF No. 23 at 2; ECF No. 19 at 2. Plaintiff was
hired as a Care Coordinator in July of 2018, and left her employment with Defendant in
June of 2019. See ECF No. 23-1 at 17; ECF No. 23 at 5. During that period, she asserts
she “regularly worked over 40 hours per workweek because [she] needed to do so in
order to keep up with [her] caseload of 60-80 enrollees.” ECF No. 19-1 at 2. She also
alleges that “at least 20 Care Coordinators in New Mexico” work or worked under similar
conditions. ECF No. 19-1 at 3. Plaintiff claims that despite these hours, Defendant “failed
to pay . . . overtime pay for all overtime hours” she and her coworkers worked. ECF
No. 19-1 at 2.
In her Motion, Plaintiff asks that the Court authorize notice to the other Care
Coordinators impacted by Defendant’s alleged company-wide misclassification scheme
over the last three years. ECF No. 19 at 2. In support of her Motion, she has submitted
her own sworn affidavit, job descriptions for the care coordinator position, and an excerpt
from Defendant’s employee manual. See ECF Nos. 19-1, 19-2, 19-3, 19-4, 19-5, 19-6.
LEGAL STANDARD
I.

Fair Labor Standards Act

The Fair Labor Standards Act (“FLSA”) requires employers to pay covered
employees who work longer than forty hours in a given workweek “at a rate not less than
one and one-half times the regular rate at which [the employee] is employed.” 29 U.S.C.
§ 207(a)(1). As the Tenth Circuit has recognized, “[t]he purpose of FLSA overtime is to
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compensate those who labored in excess of the statutory maximum number of hours for
the wear and tear of extra work and to spread employment through inducing employers
to shorten hours because of the pressure of extra cost.” Chavez v. City of Albuquerque,
630 F.3d 1300, 1304 (10th Cir. 2011) (quoting Bay Ridge Operating Co. v. Aaron, 334
U.S. 446, 460 (1948)).
Under the FLSA, an employee may bring a collective action on behalf of similarly
situated employees as a remedy for violation of the FLSA. 29 U.S.C. § 216(b). The
purpose of collective action is to lower costs for individual plaintiffs but nonetheless
“vindicate rights by the pooling of resources.” Hoffmann-La Roche Inc. v. Sperling, 493
U.S. 165, 170 (1989). It also benefits the judicial system “by efficient resolution in one
proceeding of common issues of law and fact arising from the same alleged . . . activity.”
Id. Unlike Federal Rule of Civil Procedure 23 class actions, putative collective members
under the FLSA must opt into the collective rather than opting out. Thiessen v. Gen. Elec.
Cap. Corp., 267 F.3d 1095, 1102 (10th Cir. 2001); 29 U.S.C. § 216(b) (“No employee
shall be a party plaintiff to any such action unless he gives his consent in writing to
become such a party and such consent is filed in the court in which such action is
brought.”). To obtain these consents, after the court finds that members of the proposed
collective are sufficiently similarly situated, parties may send notice of the opportunity to
opt into the collective action. See, e.g., Deakin v. Magellan Health, Inc., 328 F.R.D. 427,
431 (D.N.M. 2018).
II.

Two-Stage Collective Action Certification

Under the ad hoc approach endorsed—but not mandated—by the Tenth Circuit,
“a court typically makes an initial ‘notice stage’ determination of whether plaintiffs are
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‘similarly situated.’” Thiessen, 267 F.3d at 1102. A court’s initial determination “decides
whether a collective action should be certified for purposes of notifying potential class
members.” Bustillos v. Bd. of Cnty. Comm’rs of Hidalgo Cnty., 310 F.R.D. 631, 663
(D.N.M. 2015). In this initial stage, “the court does not decide the merits of the underlying
claims or resolve factual disputes.” Id. at 647.
While the plaintiffs bear the burden of proving they are “similarly situated” to other
potential collective members, the burden is “not great.” Id. at 663. The plaintiff “need only
describe the potential class within reasonable limits and provide some factual basis from
which the court can determine if similarly situated potential plaintiffs exist.” Bustillos, 310
F.R.D. at 663 (quoting Schwed v. Gen. Elec. Co., 159 F.R.D. 373, 376 (N.D.N.Y. 1995)).
At this stage, a court “requires nothing more than substantial allegations that the putative
class members were together the victims of a single decision, policy, or plan.” Thiessen,
267 F.3d at 1102 (quoting Bayles v. Am. Med. Response of Colo., Inc., 950 F. Supp.
1053, 1066 (D. Colo. 1996), modified on recon., 962 F. Supp. 1346 (D. Colo. 1997)). “The
court must determine whether the named and potential plaintiffs are ‘similarly situated’
based on the allegations in the complaint, which may be supported by sworn statements.”
Deakin, 328 F.R.D. at 432; see also Landry v. Swire Oilfield Services, L.L.C., 252 F. Supp.
3d 1079, 1114 (D.N.M. 2017) (A plaintiff “need only describe the potential class within
reasonable limits and provide some factual basis from which the court can determine if
similarly situated potential plaintiffs exist.”).
Then, after this notice and the close of discovery, a court moves to the second
stage of its analysis, “using a stricter standard of ‘similarly situated.’” Thiessen, 267 F.3d
at 1103. The court may then reevaluate the conditional certification, usually prompted by
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a defendant’s motion to decertify the collective. Id. During the second stage of analysis,
“a court reviews several factors, including (1) disparate factual and employment settings
of the individual plaintiffs; (2) the various defenses available to defendant which appear
to be individual to each plaintiff; (3) fairness and procedural considerations; and 4)
whether plaintiffs made the filings required” before they commenced their lawsuit. Id.; see
also Deakin, 328 F.R.D. at 432.
DISCUSSION
Plaintiff has modified the proposed collective definition since filing the Motion, and
now seeks conditional certification of the following collective:
All individuals employed by Defendant as Care Coordinators who received pay
on a salary basis in the last three years.
ECF No. 27 at 13. Plaintiff explains that the duties performed by Defendant’s Care
Coordinators include “collecting information to document Program enrollees’ medical
circumstances; inputting that information into [their] computer system; following
established guidelines to maximize utilization of resources . . . coordinating care . . . [and]
arranging appointments and referrals,” among other tasks. ECF No. 19 at 3. Plaintiff has
included several job descriptions for the Care Coordinator position. ECF Nos. 19-2 at 1,
19-5 at 1, 19-5 at 2. Plaintiff alleges that her substantial allegations and her declaration
show that Defendant subjected its Care Coordinators to a common misclassification
policy in violation of the FLSA. ECF No. 19 at 2. Plaintiff maintains that the Care
Coordinators are not eligible for any exemption to the overtime protections under FLSA,
and asks that the Court authorize notice to the other salaried Care Coordinators impacted
by the alleged misclassification policy over the last three years. Id.

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I.

The Applicability of Swales

As a threshold issue, Defendant contends the Court should apply the more
demanding standards of Swales v. KLLM Transport Services, LLC, 985 F.3d 430
(5th Cir. 2021), in determining certification, in lieu of the more lenient step-one standard
under the ad hoc approach used in this Circuit. ECF No. 23 at 2. In Swales, the Fifth
Circuit held that instead of using a two-step conditional certification method to determine
if notice should be sent to potential opt-in plaintiffs, a district court should “identify, at the
outset of the case, what facts and legal considerations will be material to determining
whether a group of ‘employees’ is ‘similarly situated’” and then “authorize preliminary
discovery accordingly.” Swales, 985 F.3d at 441. The court found this because “FLSA’s
similarity requirement is something that district courts should rigorously enforce at the
outset of the litigation.” Id. at 443. Plaintiff, meanwhile, contends that the facts of Swales
are distinct from those of this case, and that the logic of the Fifth Circuit in Swales
therefore does not apply.
The two-step ad hoc procedure under Thiessen, while not mandatory, is favored
by the Tenth Circuit. Thiessen, 267 F.3d at 1105 (“[T]he ad hoc approach is the best of
the three approaches outlined[.]”). Additionally, in Swales—unlike in the instant case—
the parties had already engaged in substantial discovery on the issue of whether plaintiffs
and potential collective members were similarly situated, including “eleven depositions,
over 19,000 documents produced, and even expert evidence.” Swales, 985 F.3d at 441.
In spite of this, the district court “felt bound by the ‘conditional certification’ step” to
disregard merits evidence. Id. In Swales, the Fifth Circuit made clear that that “the district
court has broad, litigation-management discretion” and “is not captive” to any particular
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step. Id. at 443. The Swales court also found that in that particular case, which involved
a threshold issue regarding the collective members’ purported status as independent
contractors, the two-step approach was not appropriate. Id. at 442.
Here, however, the proposed collective consists of employees, and discovery has
not yet begun. See ECF Nos. 17, 18. The Court therefore finds that Defendant has not
shown adequate reason to vary from the District’s normal course. See, e.g., Deakin, 328
F.R.D. at 427; Bustillos, 310 F.R.D. at 631; Landry, 252 F. Supp. 3d at 1079. For purposes
of the instant motion, the Court’s inquiry is therefore limited to the “notice stage” of the
process, which applies a lenient test to determine whether the potential plaintiffs are
similarly situated. Deakin, 328 F.R.D. at 433.
II.

Plaintiff’s Representativeness and Merits Evidence

Next, Defendant argues that Plaintiff does not fairly represent the collective on
whose behalf she brings the instant action, as “she was paid as a non-exempt employee
for all but a few weeks of her tenure with the company, during which period she worked
no overtime,” and that her “detailed timecards fail to support that she ever worked
overtime,” which would, in any case, have contravened Defendant’s written policy. ECF
No. 23 at 1. Defendant also alleges that Plaintiff is without personal knowledge as to its
practices after her employment ended on June 17, 2019, and thus cannot attest to the
uniformity of payroll and classification practices thereafter. Id. at 1-2. Plaintiff, meanwhile,
contends that her filings suffice to offer substantial allegations, which satisfy the “lenient
burden” of this stage. ECF No. 27 at 5.
At this stage, the Court may consider several factors, including “whether potential
class members: (i) have the same employer; (ii) are subject to the same employer
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practices; (iii) suffer the same method of calculation of wages owed; and (iv) allege FLSA
violations based on the same conduct[.]” Bustillos, 310 F.R.D. at 664. The Court does
not, however, “decide the merits of the underlying claims or resolve factual disputes.” Id.
at 647; see also Deakin, 328 F.R.D. at 433.
Defendant cites Guarriello v. Asnani, 517 F. Supp. 3d 1164 (D.N.M. 2021), and
Eagle v. Freeport-McMoran, Inc., 2016 WL 7494278 (D.N.M. Aug. 3, 2016), for the
proposition that even the lenient initial certification standard “requires plaintiff to provide
more than his own speculative allegations, standing alone.” ECF No. 23 at 10. In
Guarriello, however, the court actually granted conditional certification based on Plaintiff’s
declarations and other evidence, merely limiting the collective to servers employed in New
Mexico. Guarriello, 517 F.Supp 3d at 1175-76. Meanwhile, in Eagle, the plaintiff submitted
pay records which appeared to contain mere errors—in lieu of affidavits asserting that
plaintiffs worked unpaid overtime, or that the pay records did not fully capture the hours
actually worked—and thus, the court did not grant conditional certification. Eagle, 2016
WL 7494278 at *6.
Here, however, the declaration of Plaintiff, as well as the other evidence attached
to her Motion, support Plaintiff’s description of job duties as well as the alleged
misclassification of Defendant’s Care Coordinators. ECF No. 19-1 at 1; ECF No. 19-2
at 1; ECF No. 19-5 at 1-2, 4, 6. Additionally, in her declaration Ms. Spencer states the
basis on which she believes there are individuals with identical job duties who have been
subject to Defendant’s same wage policy. Specifically, in the declaration Ms. Spencer
states:

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I base my belief and knowledge of Defendant’s companywide policies on
(1) conversations I’ve had with other Care Coordinators who have talked with me
about their job duties, hours of work, and how Defendant paid them during their
employment; (2) observing other Care Coordinators perform their job duties;
(3) CPR training that I attended with other Care Coordinators; and (4) weekly
meetings that I attended with other Care Coordinators.
ECF No. 19-1 at 3. She also provides the names of two coworkers who she thinks might
be similarly situated and wish to opt-in. Id. She further asserts that her coworkers have
identical job duties and job titles. Id.
Named Plaintiff Courtney Spencer’s declaration also supports her position that she
is similarly situated to members of the potential collective action. ECF No. 19-1 at 3.
Specifically, Ms. Spencer asserts in her declaration that there are others who
“work/worked under the same or similar conditions” as she did and that like her, they
“primarily performed Care Management work, regularly worked overtime, and were
denied overtime pay because they were subjected to the same Overtime Misclassification
Policy that denied [her] overtime pay.” Id. Additionally, Plaintiff’s exhibits include job
descriptions that show the Care Coordinator position falls within the professional ambit
that Plaintiff has described. See ECF No. 19-2 at 1; ECF No. 19-5 at 1-2, 4, 6.
While Defendant contests the substance of these job responsibilities, the duties
and descriptions in Plaintiff’s exhibits and declaration adequately support her substantial
allegations at this stage. See Maestas v. Day & Zimmeramn, LLC, 2013 WL 11311781,
at *4 (D.N.M. Dec. 20, 2013) (granting conditional certification based exclusively on
allegations in the amended complaint). Defendant’s arguments about the nature of the
job duties go to the merits of the case, and its arguments regarding Plaintiff’s similarities
to the other proposed collective members goes to the second stage of certification. See

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Calvillo v. Bull Rogers, Inc., 267 F. Supp. 3d 1307, 1313 (D.N.M. 2017). During the
second stage, Defendant may offer its arguments about the distinctions between
Ms. Spencer and the other Care Coordinators. Id.; Deakin, 328 F.R.D. at 435. Therefore,
while the Court has reviewed the declaration of CareLink Health Home Director Claudia
Cordova, submitted by Defendant with its brief, the substantive nature of the job duties
are not at issue at this stage.
Plaintiff adequately alleges that this policy targeted non-supervisory jobs with
non-exempt duties including data collection, data entry, plan education, and care
coordination. ECF No. 1 at 2; ECF No. 19 at 3; see Deakin, 328 F.R.D. at 434. Plaintiff
adequately

alleges that potential collective members, all of whom have the same

employer, are subject to the same employer practices, suffer the same method of
calculation of wages owed, and suffered FLSA violations based on the same conduct.
See Bustillos, 310 F.R.D. at 664. Plaintiff’s Complaint, Motion, Reply, and attached
exhibits therefore meet the requirements for the first stage of collective action certification
because Plaintiff has made substantial allegations that she, and individuals who share
similar non-exempt job duties, were subject to the same wage policy that misclassified
them as exempt and paid them on a salary basis without overtime, and Plaintiff has
offered adequate proof to support these allegations at this stage. ECF Nos. 1, 19, 27.
III.

Time Frame of the Proposed Collective

Finally, Defendant argues that Plaintiff’s allegations of willfulness “must be
stronger than mere claims that a defendant knew or had reason to know of a violation” in
order to justify the three-year period requested in the collective definition. ECF No. 23
at 13. Plaintiff, in turn, contends that the three-year statute of limitations applies at the
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initial stage “where a plaintiff adequately pleads it,” as she maintains she has done. ECF
No. 27 at 11.
Under 29 U.S.C. § 255(a), any FLSA action must be “commenced within two years
after the cause of action accrued . . . except that a cause of action arising out of a willful
violation may be commenced within three years after the cause of action accrued.” Here,
the Complaint alleges that “Defendant’s violations of the FLSA were willful because they
received complaints . . . that alerted Defendant[.]” ECF No. 1 at 10. In the alternative, the
Complaint alleges that “Defendant’s violations were willful because they classified other
employees who performed many of the same primary job duties as CCEs as
non-exempt[.]” Id. The Court finds that this is sufficient. See Fernandez v. Clean House,
LLC, 883 F.3d 1296, 1299 (10th Cir. 2018); Stallings v. Antero Res. Corp., 2018 WL
1250610, at *7 (D. Colo. Mar. 12, 2018), report and recommendation adopted, Stallings
v. Antero Res. Corp., 2018 WL 2561046 (D. Colo. Apr. 16, 2018); (granting conditional
certification for three years based on allegations of willfulness in Complaint). The Court
will therefore grant the Motion.
PROPOSED NOTICE AND CONSENT FORM
Plaintiff has now submitted two versions of the Proposed Notice to be sent to
members of the potential collective—one in her Motion, and one in her erroneously-filed
Reply.2 ECF No. 19-6, ECF No. 25-1. Defendant requests the Court allow the parties to
confer on the form of notice, “as it does not agree with all aspects of the form Plaintiff
proposes.” ECF No. 23 at 16. The Court also notes that Plaintiff has failed to attach a

On November 8, 2021, Plaintiff filed a Reply which was later marked as “filed in error.” ECF
No. 25. The Court has considered only the Reply filed on November 9, 2021, which Plaintiff indicates was
filed “to correct the document filed as ECF 25.” ECF No. 27 at n1.
2

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Proposed Notice with the operative Reply. See ECF No. 27. The Court will therefore order
Plaintiff to meet and confer with Defendant regarding the wording of a Proposed Notice,
and to file an updated Proposed Notice on the docket, indicating whether Defendant
opposes.
Plaintiff also requests that the Court authorize notice by mail, email and text
message, and enter an order requiring Defendant to disclose identifying information and
contact information “within three days from the entry of an Order.” ECF No. 19 at 16.
Defendant does not object to Plaintiff’s request to send notice to potential plaintiffs by
email and text, as well as by the United States Postal Service. See ECF No. 23. The
Court finds that “notice by email and text is reasonable in today’s mobile society and that
these methods of communication may offer a more reliable means of reaching an
individual even if that individual is away from home or has moved.” Calvillo, 267 F. Supp.
at 1315. The Court will therefore grant Plaintiff’s request. The Court will, however, grant
additional time for Defendant to comply.
CONCLUSION
The Court therefore finds that the allegations in the Complaint, ECF No. 1,
supported by the arguments and evidence in the Motion, ECF No. 19, constitute
substantial allegations that the putative collective members were, as a group, the victims
of a single decision, policy, or plan resulting in violations of the FLSA. For the purpose of
the Plaintiff’s FLSA claim, this case is conditionally certified as a collective action on
behalf of the following FLSA collective members, as defined in Plaintiff’s Reply brief:
All individuals employed by Defendant as Care Coordinators who received pay
on a salary basis in the last three years.

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ECF No. 27 at 13. See Abraham v. WPX Energy Prod., LLC, 322 F.R.D. 592, 611 (D.N.M.
2017) (“[A] plaintiff is not bound to the class definition in the operative complaint for
purposes of a [] motion to certify a class.”); Deakin, 328 F.R.D. at 432 (allowing plaintiffs
to modify class in reply brief). However, the Court will also order Plaintiff to clarify the
phrase “last three years.” ECF No. 27 at 13; see Winfield v. Citibank, N.A., 843 F. Supp.
2d 397, 410 (S.D.N.Y. 2012) (“notice should generally be directed to those employed
within three years of the date of the mailing of the notice . . . [h]owever, . . . courts
frequently permit notice to be keyed to the three-year period prior to the filing of the
complaint, ‘with the understanding that challenges to the timeliness of individual plaintiffs’
actions will be entertained at a later date.’”).
IT IS THEREFORE ORDERED that Plaintiff’s Motion for Step-One Notice
Pursuant to the Fair Labor Standards Act, ECF No. 19, is GRANTED.
IT IS FURTHER ORDERED that Plaintiff shall clarify to the Court whether the three
years shall run from the date of notice or the date of filing of this action, by no later than
August 15, 2022.
IT IS FURTHER ORDERED that the Court approves the requested notice
methods.
IT IS FURTHER ORDERED that Defendant shall disclose to Plaintiff’s counsel the
names, job title, start and end dates, last known addresses, email addresses, and
telephone numbers of the potential plaintiffs in a computer-readable format by
August 19, 2022.
IT IS FINALLY ORDERED that Plaintiff shall meet and confer with Defendant, and
file an updated Proposed Notice by August 15, 2022. Plaintiff shall indicate in a cover
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page whether Defendant opposes the updated wording of the Proposed Notice.
Defendant shall file its objections, if any, to the Proposed Notice by August 22, 2022.
IT IS SO ORDERED.
………………………………………….
MARGARET STRICKLAND
UNITED STATES DISTRICT JUDGE

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