Cox v. Healthcare Services Group, Inc.

Filing 34

Memorandum Opinion. Plaintiff's Motion for Conditional Class Certification 15 is granted and the two proposed classes are conditionally certified. The parties are instructed to confer and submit for this Court's consideration a joi nt proposed notice document and opt-in schedule by 6/10/2013, and Defendant is instructed to provide Plaintiff's counsel with the names and contact information for all individuals who may potentially join the classes. Judge Jack Zouhary on 6/4/2013. (D,L)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OHIO
WESTERN DIVISION
Joshua Cox,

Case No. 3:13 CV 293
Plaintiff,

MEMORANDUM OPINION

-vs-

JUDGE JACK ZOUHARY

Healthcare Services Group, Inc.,
Defendant.

INTRODUCTION
This is a Fair Labor Standards Act (“FLSA”) wage and hour case. Pending before this Court
is Plaintiff’s Motion for Conditional Class Certification (Doc. 15) pursuant to 29 U.S.C. § 201, et seq.
Defendant opposes (Doc. 27), and Plaintiff replied (Doc. 29). At a Status Phone Conference on May
30, 2013, this Court granted Plaintiff’s Motion (Doc. 32), noting it would supplement that Order with
a Memorandum Opinion.
BACKGROUND
Defendant Healthcare Services Group (“HSG”) provides housekeeping and dietary
management services in health care facilities across the country (Doc. 27 at 6). Since 2010, HSG has
provided services to 178 different health care facilities in Ohio alone (id.). Plaintiff Joshua Cox is
employed by Defendant as an Account Manager (“AM”) (Doc. 15-2 at 7). AMs work at facilities
with which HSG has contracted to provide services, and there is a dispute in this case over their

regular duties -- Defendant argues they generally are responsible for “recruiting, training, supervising
and managing housekeepers, janitors and, in some facilities, laundry workers at their facility, as well
as labor and procurement budget management, inventory, regulatory compliance, and quality control”
(Doc. 27 at 7), while Plaintiff argues they primarily are engaged in “housekeeping, floor care and
laundry duties” (Doc. 15-2 at 7–8) . Many AMs go through a training program, during which time
one is considered a Manager in Training (“MIT”).

While in the program, MITs perform

housekeeping, laundry, and floor care duties at various HSG-contracted facilities (Doc. 15-1 at 2–3).
Plaintiff alleges that AMs and MITs in Ohio perform non-exempt work under the FLSA, work
in excess of forty hours per week, and are not paid overtime to which they are entitled under the FLSA
(id.). He alleges specifically that (1) despite HSG’s classification of MITs as non-exempt employees,
it has a “uniform practice” of not paying MITs overtime; and (2) HSG misclassifies its AMs as
exempt employees and fails to pay them overtime, despite the fact AMs primarily perform nonexempt work.
DISCUSSION
The FLSA provides a private cause of action against an employer “by any one or more
employees for and in behalf of himself or themselves and other employees similarly situated.” 29
U.S.C. § 216(b). Collective actions brought by employees under the FLSA require putative class
members to opt into the action, or generally termed, the “class.” See 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.”). The statutory
standard for bringing a collective action under the FLSA is that the opt-in plaintiffs are “similarly
situated.” Id. “Similarly situated” does not mean plaintiffs need to be identical; however, it is the

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lead plaintiffs’ burden to show the opt-in plaintiffs are similarly situated to the lead plaintiffs.
O’Brien v. Ed Donnelly Enters., Inc., 575 F.3d 567, 584 (6th Cir. 2009).
FLSA Certification Standard
Traditionally, courts in the Sixth Circuit follow a two-stage certification process to determine
whether a proposed group of plaintiffs is “similarly situated” for purposes of the statute’s
requirements. The first, or “notice” stage, takes place at the beginning of discovery with a focus on
determining whether there are plausible grounds for plaintiffs’ claims. If so, plaintiffs are permitted
to solicit opt-in notices, under court supervision, to potential plaintiffs such as current and former
employees of defendant. The second stage occurs after “all of the opt-in forms have been received
and discovery has concluded.” Comer v. Wal-Mart Stores, Inc., 454 F.3d 544, 546 (6th Cir. 2006)
(internal quotation and citation omitted).
The first stage is “fairly lenient,” requiring only that plaintiffs show a colorable basis for their
claim that a class of similarly situated plaintiffs exists. Killion v. KeHE Distribs., 2012 WL 5385190,
at *3 (N.D. Ohio 2012); Olivo v. GMAC Mortg. Corp., 374 F. Supp. 2d 545, 548 (E.D. Mich. 2004).
Some courts have held that this burden can be met solely upon allegations in the complaint, Belcher
v. Shoney’s, Inc., 927 F. Supp. 249, 251 (M.D. Tenn. 1996) (citation omitted), whereas others have
required a “modest factual showing.” Pritchard v. Dent Wizard Int’l Corp., 210 F.R.D. 591, 595–96
(S.D. Ohio 2002) (quotation and citation omitted). During the notice stage, courts “do not resolve
factual disputes, decide substantive issues on the merits, or make credibility determinations.” Shipes
v. Amurcon Corp., 2012 WL 995362, at *5 (E.D. Mich. 2012) (citing Wlotkowski v. Mich. Bell Tel.
Co., 267 F.R.D. 213, 219 (E.D. Mich. 2010)). Once plaintiffs meet their burden at this stage, “a
defendant cannot overcome their showing by arguing that individual issues predominate.” Id. at *7.

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Second stage review, however, is understandably more stringent as it occurs after the receipt
of opt-in notices and after the completion of discovery. At this point, the court considers all the
evidence, in conjunction with the demographic data of the putative opt-in plaintiffs, to determine
whether the assembled class is sufficiently “similarly situated” to continue as a collective action,
whether the putative class should be “decertified,” leaving plaintiffs free to pursue their claims on an
individualized basis, or some combination of the two. The primary factors considered in a secondstage analysis are: (1) the disparate factual and employment settings of the individual opt-in plaintiffs;
(2) the various defenses available to defendants with respect to individual plaintiffs; and (3) fairness
and procedural considerations. Olivo, 374 F. Supp. 2d at 548 n.2 (citing Vaszlavik v. Storage Tech.
Corp., 175 F.R.D. 672, 678 (D. Colo. 1997)).
This Motion was filed before any appreciable discovery has taken place. Therefore, Plaintiff’s
threshold showing of being “similarly situated” will be measured against the more lenient notice
standard.
Plaintiff is Similarly Situated to the Proposed Classes of Opt-In Plaintiffs
Plaintiff seeks conditional certification of two proposed classes:
(1) All [HSG] employees who worked as an [HSG] Manager in Training or otherwise
participated in [HSG]’s Management Training program in the State of Ohio during the
last three years; and
(2) All [HSG] employees who worked as an [HSG] Account Manager in the State of
Ohio during the last three years (Doc. 15 at 1).
Plaintiff’s allegations regarding the MITs fall under a “policy to violate the policy” theory of
FLSA violations. That is, MITs are paid on an hourly basis, perform non-exempt work, and are
classified by Defendant as non-exempt; however, despite this policy, Defendant fails to pay MITs
overtime for hours worked in excess of forty per week. To satisfy his burden at this stage of the
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litigation, Plaintiff must make a minimal showing that MITs throughout Ohio are not paid overtime
in spite of HSG’s policy to the contrary.
Plaintiff’s allegation of misclassification as to the AMs requires a greater factual showing
than simply alleging the HSG classified all AMs similarly for purposes of the FLSA. See Killion,
2012 WL 5385190, at *5 (discussing several approaches to assessing the required factual showing for
misclassification); see also Shipes, 2012 WL 995362, at *9–10; Wlotkowski, 267 F.R.D. at 217. In
misclassification cases, “requiring a modest factual showing accords with the purposes of Section
216(b), and does not implicate the more stringent standards of Federal Civil Rule 23.” Killion, 2012
WL 5385190, at *5.
In support of his Motion, Plaintiff submits seven declarations -- three from AMs who also
participated in the MIT program, and four from HSG District Managers who supervise AMs in Ohio.
The AMs, who work in separate HSG-contracted facilities in Ohio, all state in their declarations, to
similar effect, that while they were MITs as well as AMs they: (1) primarily performed non-exempt
work, including housekeeping, floor care and laundry duties; (2) consistently worked more than forty
hours per week; and (3) were not paid overtime for hours worked above forty per week while working
either as an AM or MIT (Declarations of Joshua Cox, Zachary Shockley & Tyler Greene, Doc. 15-2
at 7–8, 10–11, & 12–13). He also submits HSG’s “Management Trainee Policy,” which provides that
MITs are entitled to overtime pay at “1 ½ times their hourly rate for all hours worked in excess of 40
hours in a workweek . . . .” (Doc. 1-1 at 1).
The four former District Managers, who together supervised AMs servicing approximately
54 of the HSG facilities in Ohio (Declarations of Shaun Greene, Casey Pallumbo, Matt Gargalianos
& Scott Gretchen, Doc. 15-2 at 1–3, 4–6, & 14–16, & Doc. 17-1 at 1–3), testified, to similar effect,

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that AMs throughout the state of Ohio: (1) perform housekeeping, laundry, and floor care duties; (2)
routinely worked in excess of forty hours per week; and (3) were not paid overtime. They further
testified that they, as District Managers, were instructed by their supervisors to ensure MITs were paid
only for forty hour weeks “regardless of how many hours [the MITs] worked.” These declarations,
combined with those from the AMs and the Management Trainee Policy, constitute a sufficient factual
showing that Plaintiff is similarly situated to potential opt-in plaintiffs in the proposed classes.
Defendant argues generally that HSG employs a decentralized management philosophy,
meaning AMs in particular have discretion in how they perform their jobs, and that individual AMs
and MITs have differing job duties and responsibilities based on several factors, including the size
of and patient population served by a particular location, the level of involvement in day-to-day
operations by corporate supervisors, and the presence of unions. Defendant also argues Plaintiff’s
declarations are “vague” and “cursory” and thus should not be afforded much weight. Because of
these distinctions, Defendant argues AMs and MITs, even limited to the state of Ohio, are not
similarly situated. It also argues that MITs in fact are paid overtime. But these arguments, supported
by Defendant’s own affidavits, are better considered during the second stage of this action. See
Killion, 2012 WL 5385190, at *3 (“At the notice stage, this Court does not undertake a credibility
determination to weigh the declarations in support of each side.”).
Because Plaintiff has sufficiently shown, at this point in the litigation, a colorable basis for his
claim that classes of similarly situated plaintiffs exist, conditional certification is appropriate. Once
discovery is completed, this Court will be in a position to reassess under the more stringent standard
whether certification of these two classes, as presently constituted, is appropriate, or whether based
on the alleged distinctions Defendant raises, this case calls for full or partial decertification.

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CONCLUSION
For the foregoing reasons, Plaintiff’s Motion for Conditional Class Certification (Doc. 15) is
granted and the two proposed classes are conditionally certified. The parties are instructed to confer
and submit for this Court’s consideration a joint proposed notice document and opt-in schedule by
June 10, 2013, and Defendant is instructed to provide Plaintiff’s counsel with the names and contact
information for all individuals who may potentially join the classes.
IT IS SO ORDERED.
s/ Jack Zouhary
JACK ZOUHARY
U. S. DISTRICT JUDGE
June 4, 2013

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