Attanasio et al v. Community Health Systemsm, Inc. et al
MEMORANDUM (Order to follow). Signed by Honorable A. Richard Caputo on 3/27/2012. (bg, )
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
CARMEN ATTANASIO, LYNN MARIE
POTOSKI, and DENISE GAITERI, on
their own behalf and for all others similarly
CIVIL ACTION NO. 3:11-CV-582
COMMUNITY HEALTH SYSTEMS, INC.,
WYOMING VALLEY HEALTH CARE
SYSTEM and WILKES-BARRE
HOSPITAL CO., LLC,
Presently before the Court is the Defendants’ Motion to Dismiss (In Part) the
Amended Complaint. (Doc. 25.) In their Amended Collective Action Complaint, Plaintiffs
allege two categorical violations of the Fair Labor Standards Act of 1938 (“FLSA”), 29
U.S.C. §§ 201, et seq. Defendants allege: (1) that Defendant Community Health Systems,
Inc. should be dismissed as its employer status has not been properly plead; and (2) that
off-the-clock uniform maintenance work cannot support a FLSA claim. Since a uniform
maintenance can support a FLSA claim, Defendants’ Motion will be denied in that respect.
However, because the Plaintiffs have not properly pleaded that Community Health Systems
is an employer under the FLSA, that Defendant will be dismissed and Plaintiffs will be
afforded one further opportunity to amend their Complaint.
Plaintiffs Carmen Attanasio, Lynn Marie Potoski, and Denise Gaiteri (“Plaintiffs”)
bring this Amended Collective Action Complaint1 pursuant to the Fair Labor Standards Act
of 1938 (“FLSA”), 29 U.S.C. §§ 201, et seq. They allege that Defendants Community
Health Systems, Inc., Wyoming Valley Health Care System, and Wilkes-Barre Hospital Co.,
LLC (“Defendants”), and all of the Pennsylvania health care systems and hospitals under
Defendants’ control, violated the FLSA by failing to compensate their employees for the
time they spent working during meal breaks and on required maintenance of their uniforms.
(Am. Compl. at ¶ 1, Doc. 1.)
At all pertinent times, all three of the named Plaintiffs worked as registered nurses
at the Wilkes-Barre General Hospital. (Id. at ¶¶ 5, 6, 7.) All three specifically allege that
between March 28, 2008 and April 30, 2009, they worked for Wilkes-Barre Hospital Co.,
LLC (“WBHC”) and the Wyoming Valley Health Care System (“WVHCS”). (Id.) WVHCS
is alleged to have been “Northeastern Pennsylvania’s leading health care delivery network,
employing more than 3,000 people” (Id. at ¶ 9), and WBHC was apparently “a wholly-owned
subsidiary or affiliate of WVHCS that shared responsibility for the operation and
management of Wilkes-Barre General Hospital . . . with more than 2,000 employees” (Id.
at ¶ 10). On April 30, 2009, WVHCS was acquired by Community Health Systems, Inc.
(“CHS”) and its wholly-owned subsidiary or affiliate, Wilkes -Barre Holdings, LLC. (Id. at ¶
9.) Therefore, from that date on,2 the Plaintiffs also allege to have been employed by CHS.
The Fair Labor Standards Act provides for such collective action: “An action to
recover . . . may be maintained against any employer . . . in any Federal or State court of
competent jurisdiction 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).
Plaintiffs Potoski and Gaiteri are apparently still registered nurses at Wilkes-Barre
General Hospital, while it appears that Plaintiff Attanasio departed his position on July 15,
2011. (Am. Compl. at ¶¶ 5-7.)
In Pennsylvania, CHS allegedly owns and operates “on its own or through its affiliates”
entities employing more than 11,000 people “who, together, comprise the putative Class in
this litigation.” (Id. at p. 5, n.1.) Thus, to clarify, the putative class as between the dates of
March 28, 2008 and April 29, 2009 would pertain only to WVHCS’s 3,000 employees (and
the lesser-included WBHC), while the putative class from class from April 30, 2009 to the
present would include all 11,000 of CHS’s Pennsylvania employees.
In their Amended Collective Action Complaint, Plaintiffs are seeking to assemble two
subclasses to address two distinct violations by their employers. The first proposed class
is the “meal break work sub-class.”3 There, the Plaintiffs complain that while provided one
unpaid meal break per shift, they were routinely forced to perform duties during this unpaid
time. (Id. at ¶¶ 32-33.) The Defendants were aware that this work was occurring because
their “agents regularly encouraged, instructed, suffered and permitted Plaintiffs and the
Class members to perform this work and observed this work being performed on a regular
basis.” (Id. at ¶ 34.) Specifically, the named Plaintiffs aver that they were each required to
work for roughly 95% of their meal breaks. (Id. at ¶¶ 39-41.) At their respective overtime
rates, Plaintiffs Attanasio, Potoski, and Gaiteri are seeking $13,087, $14,763 and $15,290,
respectively, for this meal break work. (Id.)
“[T]he ‘meal break work sub-class’ is defined to include all Pennsylvania residents
employed in hospital facilities owned or operated by Defendants, their subsidiaries, or their
affiliated companies between March 28, 2008 and the present who were suffered or
permitted to perform more than de minimis meal break work for Defendants’ benefit, but
who were not properly compensated for this work.” (Am. Compl. at ¶ 20(a), Doc. 24.)
Instances of “more than de minimus meal break work” include, but are not limited to,
“providing patient care and monitoring, administering medicine to patients, interacting with
other hospital employees and visitors, monitoring blood-work and patient test results and
responding to emergency situations.” (Id. at ¶ 21(a).)
The second class, styled as the “uniform maintenance work sub-class,”4 complains
that the “Defendants maintained policies and practices that required Plaintiffs and the Class
members to maintain a professional appearance in the workplace” (Id. at ¶ 45), and that this
was done outside of work as “Plaintiffs and the Class members were not permitted to
perform the required uniform maintenance work at their assigned work locations or during
their shifts.” (Id. at ¶ 47.) As in the above meal break subclass, the Plaintiffs allege that the
Defendants were aware of the maintenance being done outside of work as their “agents
observed the results of this work on a regular basis.” (Id. at ¶ 49.) Specifically, the named
Plaintiffs aver that they were each required to “perform eight hours of off-the-clock uniform
maintenance work each month.” (Id. at ¶¶ 39-41.) At their respective overtime rates,
Plaintiffs Attanasio, Potoski, and Gaiteri are seeking $11,700, $14,448 and $14,964,
respectively, for their work maintaining their uniforms. (Id.)
Plaintiffs’ Amended Complaint further seeks a list of names of potential Class
members and the authorization to issue notice to those individuals. Moreover, Plaintiffs are
seeking compensatory damages, pre-judgment interest, liquidated damages, attorney’s fees
and costs as well as equitable and injunctive relief. Plaintiffs claim that all named parties
are members of both subclasses, and that all Plaintiffs and class members were subjected
to the same meal break and uniform maintenance policies and systems. Plaintiffs believe
“[T]he ‘uniform maintenance work sub-class’ is defined to include all Pennsylvania
residents employed in hospital facilities owned or operated by Defendants, their
subsidiaries, or their affiliated companies between March 28, 2008 and the present who
were suffered or permitted to perform more than de minimis uniform maintenance work for
Defendants’ benefit, but who were not properly compensated for this work.” (Am. Compl.
at ¶ 20(b), Doc. 24.) Examples of this maintenance work include “washing, drying, ironing,
spot cleaning and otherwise maintaining all of the components of [the] work uniform in
good and presentable condition.” (Id. at ¶ 21(b).)
the Class, “including both current and ex-employees over the relevant period, will include
more than 5,000 people.” (Id. at ¶ 23.)
Defendants have collectively moved to dismiss portions of the Amended Complaint
as it fails to allege: (1) that CHS is an employer for purposes of the FLSA; (2) that WVHCS
and WBHC are joint employers as to class members working outside the Wyoming Valley
Health Care System5; and (3) a plausible claim as to the uniform maintenance subclass.
The Defendants’ Motion has been fully briefed and is ripe for the Court’s review.
I. Legal Standard
Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint,
in whole or in part, for failure to state a claim upon which relief can be granted. When
considering a Rule 12(b)(6) motion, the Court’s role is limited to determining if a plaintiff is
entitled to offer evidence in support of their claims. See Scheuer v. Rhodes, 416 U.S. 232,
236 (1974). The Court does not consider whether a plaintiff will ultimately prevail. See id.
A defendant bears the burden of establishing that a plaintiff’s complaint fails to state a
claim. See Gould Elecs. v. United States, 220 F.3d 169, 178 (3d Cir. 2000).
“A pleading that states a claim for relief must contain . . . a short and plain statement
of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a). The
Specifically, the Defendants seek to have the Amended Complaint dismissed
insofar as it “can be read as alleging that the Wilkes-Barre Hospital Defendants, WVHCS
and WBHC employed workers outside the Wyoming Valley Health Care System.” (Def.’s
Br. at 22, Doc. 26.) I do not find that the Amended Complaint alleges that these
subsidiaries, through their parent, CHS, actually employed workers at the parent
company’s other Pennsylvania locations. Further, as Plaintiffs argue, it is unnecessary at
this stage to address the issue of WBHC and WVHCS employees who have since
migrated to CHS’s other locations.
statement required by Rule 8(a)(2) must give the defendant fair notice of what the . . . claim
is and the grounds upon which it rests.’” Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per
curiam) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Detailed factual
allegations are not required. Twombly, 550 U.S. at 555. However, mere conclusory
statements will not do; “a complaint must do more than allege the plaintiff’s entitlement to
relief.” Fowler v. UPMC Shadyside, 578 F.3d 203, 211 (3d Cir. 2009). Instead, a complaint
must “show” this entitlement by alleging sufficient facts. Id. “While legal conclusions can
provide the framework of a complaint, they must be supported by factual allegations.”
Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009).
As such, the inquiry at the motion to dismiss stage is “normally broken into three
parts: (1) identifying the elements of the claim, (2) reviewing the complaint to strike
conclusory allegations, and then (3) looking at the well-pleaded components of the
complaint and evaluating whether all of the elements identified in part one of the inquiry are
sufficiently alleged.” Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011).
Dismissal is appropriate only if, accepting as true all the facts alleged in the
complaint, a plaintiff has not pleaded “enough facts to state a claim to relief that is plausible
on its face,” Twombly, 550 U.S. at 570, meaning enough factual allegations “‘to raise a
reasonable expectation that discovery will reveal evidence of’” each necessary element,
Phillips v. County of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008) (quoting Twombly, 550
U.S. at 556). “The plausibility standard is not akin to a ‘probability requirement,’ but it asks
for more than a sheer possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal,
129 S. Ct. 1937, 1949 (2009). “When there are well-pleaded factual allegations, a court
should assume their veracity and then determine whether they plausibly give rise to an
entitlement to relief.” Id. at 1950.
In deciding a motion to dismiss, the Court should consider the allegations in the
complaint, exhibits attached to the complaint, and matters of public record. See Pension
Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). The
Court may also consider “undisputedly authentic” documents when the plaintiff’s claims are
based on the documents and the defendant has attached copies of the documents to the
motion to dismiss. Id. The Court need not assume the plaintiff can prove facts that were
not alleged in the complaint, see City of Pittsburgh v. W. Penn Power Co., 147 F.3d 256,
263 & n.13 (3d Cir. 1998), or credit a complaint’s “‘bald assertions’” or “‘legal conclusions,’”
Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997) (quoting In re Burlington
Coat Factory Sec. Litig., 114 F.3d 1410, 1429-30 (3d Cir. 1997)).
Failure to Allege CHS as an Employer
Plaintiffs allege that from the day CHS acquired WVHCS it has “owned and
operated” WVHCS and WBHC and therefore “has been an ‘employer’ of Plaintiffs and the
Class members as defined by the FLSA, 29 U.S.C. §203(d).” (Am. Compl. at ¶ 8, Doc. 24.)
The Defendants retort that CHS has been implicated with “boilerplate allegations” that are
“nothing more than ‘a formulaic recitation of the elements of a cause of action.’” (Def.s’ Br.
at 14, Doc. 26 (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).) In
particular, Defendants find it insufficiently plausible from the allegations in the Amended
Complaint that CHS, as a Tennessee corporation, oversaw the “daily working conditions of
more than 11,000 employees at thirteen health care facilities scattered throughout the
Commonwealth.” (Id. at 16.)
The FLSA defines an “employer” as “any person acting directly or indirectly in the
interest of an employer in relation to an employee,” 29 U.S.C. § 203(d), and an “employee”
as “any individual employed by an employer,” 29 U.S.C. § 203(e)(1). Courts have afforded
these definitions a broad reading, in part to “further the remedial purposes of the FLSA.”
Cavallaro v. UMass Memorial Health Care Inc., No. 09-40152, 2011 WL 2295023 at *3
(D.Mass June 8, 2011) (citations omitted). An employee may have multiple employers for
FLSA purposes, and depending on the particular facts, those employers may be jointly
responsible for compliance with the Act’s provisions. 29 C.F.R. § 791.2(a); Davis v.
Abington Memorial Hosp., --- F.Supp.2d ----, Nos. 09–5520, 09–5533, 09–5548, 09–5549,
09–5550, 09–5551, 2011 WL 4018106 at *3 (E.D. Pa. Sept. 8, 2011) (“A joint employment
relationship can exist when employers are not “completely associated” with respect to the
employment of individuals, or where one employer is controlled by another, or the
employers are under common control.”). Similarly, individual companies can also be
grouped together as a single-employer for the purposes of the Act where they are “so
interrelated that they constitute a single employer.” Id. at *3 (citing Torres–Negron v. Merck
& Co., Inc., 488 F.3d 34, 41 (1st Cir. 2007)). In any event, determining the existence of
such a joint employment relationship considers the “‘real economic relationship’ between
the employee, employer, and putative joint employer.” Lepkowski v. Telatron Mktg. Group,
766 F. Supp. 2d 572, 577 (W.D. Pa. 2011) (citation omitted).
In certain instances, FLSA liability can be shared between a parent corporation and
its subsidiary–“[l]iability for violating an employee's rights under FLSA has attached to a
parent corporation for the acts of a subsidiary when the parent substantially controls the
terms and conditions of employment at its subsidiary on a regular basis.” Lehman v. Legg
Mason, Inc., 532 F. Supp. 2d 726, 733 (M.D. Pa. 2007) (citing Falk v. Brennan, 414 U.S.
190, 195 (1973)). However, “‘[t]he doctrine of limited liability creates a strong presumption
that a parent corporation is not the employer of its subsidiary's employees,’ and ‘[o]nly
evidence of control suggesting a significant departure from the ordinary relationship
between a parent and its subsidiary’ is sufficient to establish a joint employer relationship.”
Enter. Rent-A-Car Wage & Hour Empl. Practices Litig. v. Enter. Rent-A-Car Co.
(Enterprise), 735 F. Supp. 2d 277, 338 (W.D. Pa. 2010); Lowenstein v. Catholic Health
East, --- F.Supp.2d ----, Civ. Act. No. 11-4689, 2011 WL 5069396 (E.D. Pa. Oct. 26, 2011)
(“It is well settled that a parent corporation, like any stockholder, is not normally liable for
the wrongful acts . . . of a subsidiary even if or simply because the parent wholly owns the
subsidiary.” (internal quotation and citation omitted)); Bosley v. Chubb Corp., No. Civ. A.
04CV4598, 2005 WL 1334565 at *5 (E.D. Pa. June 3, 2005) (holding that “a parent
corporation is not, under normal circumstances, liable as the employer of its subsidiaries'
The Third Circuit has not specified the determinative factors in this analysis,
Enterprise, 735 F. Supp. 2d at 338, although courts in other circuits6 have applied the
integrated enterprise test, “a standard by which courts may essentially pierce the corporate
veil for purposes of establishing employer liability in labor and employment law cases.”
Perez-Benites v. Candy Brand, LLC, No. 1:07–CV–1048, 2011 WL 1978414 at *11 (W.D.
Ark. May 20, 2011). That test considers, as between the parent and the subsidiary, any:
The Third Circuit has, however, acknowledged the application of the integrated
enterprise test to FLSA matters. Pearson v. Component Technology Corp., 247 F.3d 471,
486 (3d Cir. 2001).
“(1) interrelation of operations; (2) common management; (3) centralized control of labor
relations; and (4) common ownership or financial control.” Id. Bosley v. Chubb Institute
endorsed such an approach, holding that in order to implicate the parent corporation in a
FLSA overtime claim, the plaintiffs would have to add facts suggesting a “vertical
enterprise.” 516 F. Supp. 2d 479, 483 n.3 (E.D. Pa. 2007). Further, Enterprise applied a
very similar set of factors in determining, at the summary judgment stage, that the parent
company was not a joint employer. 735 F. Supp. 2d at 346. Those specific factors included
the: “1) authority to hire and fire employees, promulgate work rules and assignments, and
set conditions of employment, including compensation, benefits, and hours; 2) day-to-day
supervision of employees, including employee discipline; and 3) control of employee
records, including payroll, insurance, taxes and the like.” Id. at 339 (quoting Lewis v.
Vollmer of America, No. 05-1632, 2008 WL 355607 at *4 (W.D. Pa. Feb. 7, 2008)).
The economic realities of the instant matter direct the Court to analyze CHS as a
parent corporation under the FLSA. In particular, the Amended Complaint pleads that
“[d]uring the Class Period, through an array of wholly-owned subsidiaries or affiliates, CHS
has owned and operated at least 13 hospitals or health systems in Pennsylvania.” (Am.
Compl. at ¶ 8, Doc. 24.) In the same apparent fashion, on April 30, 2009, “through its
wholly-owned subsidiary or affiliate, Wilkes-Barre Holdings, LLC, CHS acquired the assets
of [WVHCS], including [WBHC].” (Id.) By virtue of this ownership, the Plaintiffs state that
CHS is “an ‘employer’ of Plaintiffs and the Class members as defined by the FLSA, 29
U.S.C. §230(d).” (Id. at ¶ 8.) This, however, is not automatically dispositive in the parentsubsidiary corporate arrangement, and a more detailed analysis of the employer-employee
relationship is warranted. Of course, the pleadings relied on must present a “a ‘showing’
rather than a blanket assertion of an entitlement to relief.” Phillips v. County of Allegheny,
515 F.3d 224, 233 (3d Cir. 2008). And, “mere boilerplate allegations . . . without any
supporting details–essentially ‘a formulaic recitation of the elements of a cause of
action’–are insufficient to raise plaintiffs’ right to relief ‘above a speculative level’ with
respect to that individual's liability as an employer.” Tracy v. NVR, Inc., 667 F. Supp. 2d
244, 247 (W.D.N.Y. 2009) (quoting Twombly, 550 U.S. at 555).
Resolving between formulaic recitations and factual showings is a detailed analysis.
Squarely on the conclusory side of the spectrum are assertions that individual defendants
exerted “‘operational control’ of the institutional defendants and [were] ‘ultimately
responsible’ for ensuring their compliance with the FLSA.” Wright v. Lehigh Valley Hosp.
& Health Network, CIV. A. 10-431, 2011 WL 2550361 (E.D. Pa. June 23, 2011) (finding
such statements “legal conclusions utterly devoid of any factual basis asserted to support
the beliefs pled.”). Missing from this were “rudimentary facts as specifying which proposed
individual defendant controlled which institutional defendant, whether they had any specific
role in each corporations' personnel, financial and compensation practices, and most
importantly, whether they had any role in the corporations' alleged determination to
compensate (or not compensate) its employees in accordance with the FLSA.” Id. Similarly
insufficient pleadings are exemplified in Orosa v. Therakos where the plaintiffs–in
attempting to substantiate that the larger corporation was their indirect employer–included
statements that a particular corporation had “exercised complete control over all material
aspects” of the alleged subordinate corporation, and the conclusion that the smaller
corporation was a “division” of the larger corporation. No. C–11–2143 EMC, 2011 WL
3667485 at *5 (N.D. Cal. Aug. 22, 2011). Again, these bald assertions presented too few
details as to the mechanics of the defendant’s alleged control. Id. However, Orosa
contrasted these infirm allegations against those that had been found sufficiently factual in
a similar context, including statements that a defendant had “maintained control and
authority, directly or indirectly, over all functions at other . . . entities,” that the defendant
“ha[d] the authority to create policies regarding compensation and hours,” that “it ma[de]
decisions concerning hiring and firing employees,” and that the defendant “controlled
plaintiffs' work schedules, rates and method of payment and benefits.” Id. (quoting Helm
v. Alderwoods Group, Inc., 696 F. Supp. 2d 1057, 1073-79 (N.D. Cal., 2009)).
Such details are the backbone of a well-pleaded allegation. Specific averments,
showing that a defendant has actually been involved in the conduct being used to implicate
the employer-employee relationship, are necessary. For example, Tracy v. NVR, Inc. found
that statements alleging the “general authority to hire and/or fire” and past maintenance of
employee records were insufficient to implicate a company vice president as a FLSA
defendants. 667 F. Supp. 2d 244, 247 (W.D.N.Y. 2009). These assertions lacked any
“supporting details to substantiate their belief,” namely any “facts concerning the extent of
[vice president’s] alleged involvement in [the company’s] hiring and/or firing processes or
To the extent those plaintiffs argued that the alleged
defendant had generally influenced control over their work schedules, conditions of
employment, and compensation, this was also deemed inadequate “to raise plaintiffs' right
to relief “above a speculative level.’” Id. (citing Twombly, 550 U.S. at 555). Finally, in the
related context of employment discrimination, McGehean v. AF&L Ins. Co. held an assertion
that a parent corporation “owned and operated [the subsidiary] or otherwise had direct
control over [its] business” as factually devoid to support the requirement of “functional
integration of the operations of the parent and subsidiary, central control of labor relations,
common management and common financial control.” 2009 WL 3172763 at *4 (E.D. Pa.
Oct. 02 2009). In particular, congruent with the matter sub judice, McGehean found it
unclear “how AF & L, a Warminster, Pennsylvania based long-term care insurance policy
provider, and CIVC, a Chicago, Illinois-based equity firm, would integrate their operations,
centrally control their labor relations and share common management and financial control.”
In the Amended Complaint, the Plaintiffs argue that CHS and WBHC are together
an integrated enterprise since CHS has the ability to:
hire and fire Plaintiffs and all of the Class members; control the work
performed by Plaintiffs and all of the Class members; direct the manner in
which Plaintiffs and all of the Class members performed their work; inspect
and supervise the work Plaintiffs and all of the Class members performed;
promulgate policies and procedures (including the work, time, pay, overtime,
appearance and uniform maintenance policies and procedures at issue here)
governing the employment of Plaintiffs and all of the Class members; enforce
these policies and procedures with respect to Plaintiffs and all of the Class
members; and determine the pay given to Plaintiffs and all of the Class
(Am. Compl. at ¶ 18, Doc. 24.) As to the period prior to CHS’s acquisition, the Amended
Complaint alleges that WVHCS and WBHC had the exact same rights. (Id. at ¶ 17.) The
Amended Complaint then also alleges that the Class members were “required to follow and
abide by common work, time, pay, overtime, appearance and uniform maintenance policies
and procedures in the performance of their jobs” (Id. at ¶¶ 14-15), and that “regardless of
the hospital facility in which they worked, Plaintiffs and the Class members received wages
from Defendants that were determined by common systems and methods that Defendants
selected and controlled.” (Id. at ¶ 16.)
As an initial matter, the above allegations from the Amended Complaint focus heavily
on the first and third Enterprise factors–CHS’s authority to dictate the terms of employment
and the administration of employee records. 735 F. Supp. 2d at 339. They do not,
however, acknowledge the second factor, the “day-to-day supervision of employees.” Id.
Although not alone dispositive, it is notable that no daily control is alleged. However, even
assuming that these allegations are sufficiently broad to upset the presumption that the
parent corporation is not the employer of its subsidiary's employees, these particular
recitations are conclusory and implausible.
First, Plaintiffs’ allegations establishing
employer control by WVHCS and later CHS are effectively identical. This forecloses the
possibility that these pleadings are particularized and demonstrates that these allegations
are devoid of any actual factual support. Yet, even beyond that these pleadings are
boilerplate, is that there are no operative details suggesting exactly how CHS exercised
authority over the particular employees, how these employees were supervised by a
Delaware corporation headquartered in Tennessee acting through a holding company, and
how they oversaw the administration of the business records. As in the aforementioned
cases, the Amended Complaint omits particularized assertions explaining the specific role
CHS played in regard to the Plaintiffs within this administrative structure. There are no
supporting details as to the mechanics of CHS’s actual involvement7 as a parent corporation
Further, the Plaintiffs include in the Amended Complaint several assertions that
lump all three Defendants together, including that each day the Plaintiffs, and the Class
members, “reported to a hospital facility owned, operated or managed by Defendants to
perform their jobs,” “toiled under the Defendants' supervision,” and were “required to follow
and abide by common work, time, pay, overtime, appearance and uniform maintenance
policies and procedures in the performance of their jobs.” (Am. Compl. at ¶¶ 13-15, Doc.
24.) However, to the extent that the Plaintiffs make these assertions simultaneously as
against all three Defendants, this impedes the analysis as to whether CHS, as the parent
that would raise Plaintiff’s assertions above a speculative level. Instead, Plaintiffs have
presented a list of relevant factors as fact without providing any detail to support that these
factors actually apply to the situation at hand. This is especially notable where the
presumption is that CHS, as the parent company, is not Plaintiffs’ employer. From this,
Plaintiffs “have not nudged their claims across the line from conceivable to plausible.”
Twombly, 550 U.S. at 570.
Plaintiffs have not sufficiently pleaded that CHS is an employer for the purposes of
the FLSA.8 However, the presumption that the parental corporation is not a FLSA employer
company, was actually an employer as envisioned by the FLSA.
Plaintiffs further characterize CHS as an “indispensable party” as pursuant to
Federal Rule of Civil Procedure Rule 19. Under Rule 19, a party is required to be joined, if
(A) in that person's absence, the court cannot accord complete relief among
existing parties; or
(B) that person claims an interest relating to the subject of the action and is
so situated that disposing of the action in the person's absence may:
(i) as a practical matter impair or impede the person's ability to protect
the interest; or
(ii) leave an existing party subject to a substantial risk of incurring
double, multiple, or otherwise inconsistent obligations because of the
Fed. R. Civ. P. 19(a)(1). Plaintiffs offer little argument on this point, but insist that “CHS is
a necessary party to Plaintiffs’ suit given its direct, obvious and extensive ties to the
conduct alleged in Plaintiffs’ Amended Complaint, as well as its direct financial interest in
the claims pending against its healthcare facilities.” (Pl.’s Br. at 7, Doc. 28.) This is not
sufficient. There is no direct assertion that complete relief cannot be accorded without the
inclusion of CHS. Janney Montgomery Scott, Inc. v. Shepard Niles, Inc., 11 F.3d 399, 405
(3d Cir. 1993). Nor, where CHS is affirmatively attempting to extricate itself from the case,
is there any need to “protect the person whose joinder is in question against the practical
prejudice to him which may arise through a disposition of the action in his absence.” Fed.
R. Civ. P. 19, Advisory Committee Notes, 1966 Amendment. Finally, if a “direct financial
interest” were sufficient to retain the parent corporation as a necessary party, the joint
is not an irrefutable one, and where “a complaint is subject to a Rule 12(b)(6) dismissal, a
district court must permit a curative amendment unless such an amendment would be
inequitable or futile.” Phillips v. County of Allegheny, 515 F.3d 224, 245 (3d Cir. 2008)
(citation omitted). Therefore, I will afford Plaintiffs one further opportunity to amend their
complaint solely to allege further detail as to the parent-subsidiary employment relationship
in regard to CHS.
Viability of the Uniform Maintenance Subclass
The Defendants argue that uniform maintenance work cannot, as a legal matter,
support a claim under the FLSA.
While the FLSA requires overtime compensation “for a workweek longer than forty
hours,” 29 U.S.C. § 207, it does not define the terms ‘work’ or ‘workweek.’ IBP, Inc. v.
Alvarez, 546 U.S. 21, 25 (2005). Following the enactment of the FLSA, expansive judicial
interpretations arose to fill in these terms, which Congress then deemed to be in “disregard
of long-established customs, practices, and contracts between employer and employees,
thereby creating wholly unexpected liabilities, immense in amount and retroactive in
operation.” Id. at 26 (citing 61 Stat. 84). As such, Congress amended the relevant portions
of the FLSA with the Portal-to-Portal Act of 1947 (the “Act”), 29 U.S.C. § 251 et seq. Id.
In pertinent part, the Act provides that:
[N]o employer shall be subject to any liability or punishment under the Fair
Labor Standards Act of 1938, as amended . . . on account of the failure of
such employer to pay an employee minimum wages, or to pay an employee
overtime compensation, for . . . activities which are preliminary to or
postliminary to said principal activity or activities, which occur either prior to
the time on any particular workday at which such employee commences, or
employment tests outlined above would be pointless, which cannot be the case.
subsequent to the time on any particular workday at which he ceases, such
principal activity or activities.
29 U.S.C. § 254(a)(2). The Supreme Court has held that this Act does not except activities
that “are an integral part of and are essential to the principal activities of the employees.”
Steiner v. Mitchell, 350 U.S. 247, 254 (1956). To the extent the Act was enacted to protect
employers from the unintended liability imposed by the courts, it was not designed to upset
the more traditional interpretations of the term “work.” De Asencio v. Tyson Foods, Inc., 500
F.3d 361, 367 (3d Cir. 2007) (citing Alvarez, 546 U.S. at 28). Thus, as the Plaintiffs point
out, the Act does not insulate employers from work they have reason to believe an
employee is performing, so long as that work is an integral part of and is essential to the
principal activities of the employee.9 See 29 C.F.R. § 785.13 (“In all such cases it is the
duty of the management to exercise its control and see that the work is not performed if it
does not want it to be performed. It cannot sit back and accept the benefits without
compensating for them.”). Conversely, “the fact that certain preshift activities are necessary
for employees to engage in their principal activities does not mean that those preshift
activities are ‘integral and indispensable’ to a ‘principal activity.’” Alvarez, 546 U.S. at 40.
Plaintiffs argue that since they were required to meet certain uniform maintenance
standards, their time spent conducting uniform maintenance could be considered by the
Court as “part of their work day under the 'continuous workday rule.’” (Pl.'s Br. at 19, Doc.
28.) This is not the case. A continuous workday is generally comprised of “the period
between the commencement and completion on the same workday of an employee's
principal activity or activities.” IBP, Inc. v. Alvarez, 546 U.S. 21, 29 (2005) (citing 29 C.F.R.
§ 790.6(b)). “The critical inquiries here are when and where the workday starts, for once it
begins, the continuous workday rule applies and the Portal-to-Portal Act's exceptions for
travel and preliminary activities are inapplicable.” Gortat v. Capala Bros., 257 F.R.D. 353,
361 (E.D.N.Y. 2009). Here, the Plaintiffs “were not permitted to perform the required
uniform maintenance work at their assigned work locations or during their shifts.” (Am.
Compl. at P. 47, Doc. 24.) Therefore, it is not the case that the uncompensated activities
Plaintiffs complain of were within the continuous workday.
Unfortunately, in interpreting what is integral and essential to the performance of a job,
courts “have applied the Steiner definition inconsistently.” Albanese v. Bergen County, 991
F. Supp. 410 (D.N.J. 1997).
In 1956, the Supreme Court held that butchers were entitled to compensation under
the FLSA for knife-sharpening as that task comprised “an integral part of and indispensable
to the various butchering activities for which they were principally employed.” Mitchell v.
King Packing Co., 350 U.S. 260, 263 (1956). More recently, Schwartz v. Victory Security
Agency, LP,10 dismissed a FLSA claim–extremely similar to the instant matter–for
uncompensated uniform maintenance and cleaning that took place outside of work,
constituting approximately one to two hours each week. No. 11-cv-0489, 2011 WL 2437009
at *1 (W.D. Pa. June 14, 2011). In deciding whether such activity was “preliminary to or
postliminary” as envisioned by the Act, that court determined that “if an activity is not
essential to complete the employee's principal task the employee is not entitled to
compensation for the activity pursuant to the Portal–to–Portal Act.” Id. at *4 (quoting
Musticchi v. City of Little Rock, 734 F. Supp. 2d 621, 631 (E.D. Ark. 2010)). Specifically,
Schwartz held that even though the plaintiffs were “required to wear and therefore maintain
their uniforms, such actions were not integral and indispensable to Plaintiffs' principal
activity, providing security.” Id. at *5.
Defendants argue that Schwartz is not reliable precedent as Judge Schwab
subsequently denied a motion for an interlocutory appeal on the matter, stating that
Schwartz was “based upon the specific factual circumstances . . . and that such resultant
findings would not contribute to the determination, at an early stage, of a wide range of
cases.” Schwartz v. Victory Sec. Agency, LP, No. 11-cv-04892011, U.S. Dist. LEXIS
69868 (W.D. Pa. June 29, 2011). This argument would be more persuasive if the
operative factual circumstances at issue in Schwartz were not practically identical to those
in the instant case.
Defendants also rely on Musticchi v. City of Little Rock, which held at summary
judgment that time spent by police officers “polishing shoes, boots and duty belts, cleaning
radios and traffic vests and oiling handcuffs are preliminary and postliminary activities and
not compensable under the Portal-to-Portal Act.” 734 F. Supp. 2d 621, 631 (E.D. Ark.
2010). In particular, that court reasoned that “[w]hile polishing and cleaning may be a
necessary or an indispensable component of being a [police] officer, unlike a butcher
sharpening a knife or an x-ray technician powering and testing an x-ray machine, [police]
officers can successfully perform their jobs without polishing and cleaning their uniform and
equipment.” Id. Musticchi thus determined that “compensating Plaintiff for such activity
would be contrary to Congress' intent pursuant to the Portal-to-Portal Act.” Id. at 632.
However, other cases have gone the opposite way on similar facts. See Albanese v.
Bergen County, N.J., 991 F. Supp. 410, 420-21 (D.N.J. 1997) (finding compensable and
denying a motion to dismiss as to police officers’ claims for “removing and polishing brass,
washing uniforms, polishing shoes and other leather gear, and maintaining guns.”);
Hellmers v. Town of Vestal, 969 F. Supp. 837, 844 (N.D.N.Y 1997) (denying summary
judgment in holding that off duty cleaning of a police vehicle and firearm were compensable
under the FLSA as “an integral and indispensable part of the principal work activity”).
The relevant cases cited by Defendants are generally inapposite to the instant
matter. In Valladon v. City of Oakland, the analysis focused on whether time spent cleaning
and maintaining police gear was de minimus, No. C 06-07478 SI, 2009 U.S. Dist. LEXIS
74439 at *16-20 (N.D. Cal. Aug. 21, 2009), and Mory v. City of Chula Vista considered
whether police academy attendees were “not considered to be on duty” pursuant to 29
C.F.R. § 553.226 while they were preparing their uniforms, No. 07-cv-462 JLS (WVG), 2010
U.S. Dist. LEXIS 100777 at *21-25 (S.D. Cal. Sept. 24, 2010). Moreover, although the
plaintiffs in Howard v. Securitas Security Services alleged that “they spent time off-the-clock
maintaining their uniforms to comply with Securitas's appearance requirements,” that court
only addressed whether those plaintiffs were similarly situated for the purposes of class
certification. No. 08 C 2746, 2009 U.S. Dist. LEXIS 3913 at *22 (N.D. Ill. Jan. 20, 2009).
Plaintiffs’ most compelling precedent, however, is Marshall v. SF of Ohio, Inc.. No. C-2-77931, 1980 U.S. Dist. LEXIS 17825 (S.D. Ohio Feb. 1, 1980). Marshall is not highly
persuasive as it is a thirty-year-old unpublished, uncited decision from the District of Ohio.
However, it is notable that Marshall interpreted Long John Silver's Seafood Shoppe’s
“distinctive ‘crew costumes’” as “indispensable to communicating [a] marketing concept to
the public,” and that time spent laundering those uniforms was therefore compensable
under the FLSA. Id. at *18.
The above cases do not indicate that a uniform maintenance subclass would be
inappropriate per se. Instead, they are limited to their own facts and are not resolvable to
any singular proposition. Even the very recent and highly analogous precedent cited by the
Defendants in Schwartz and Musticchi do not hold that uniform maintenance is inherently
non-compensable, but that in those specific instances, the uniforms were not essential to
the Plaintiffs’ stated duties and were therefore not compensable under the FLSA as
preliminary or postliminary activity. Here, the Plaintiffs’ principal work activities include
“providing patient care and monitoring, administering medicine to patients, interacting with
other hospital employees and visitors, monitoring blood-work and patient test results and
responding to emergency situations.” (Am. Compl. at ¶¶ 5-7, Doc. 24.) Further, Plaintiffs
aver that they were required to maintain a professional appearance for ends including:
“clearly identifying themselves as hospital personnel; differentiating among different types
of hospital staff and care providers; conveying their professionalism and competence;
fostering the appearance of safety and security in their assigned work locations; and
fostering morale and camaraderie among its employees.” (Id. at ¶ 45.) Whether these
uniforms are truly integral to these ends will ultimately dictate whether preliminary or
postliminary11 time spent maintaining these uniforms is compensable. This is a very difficult
determination on these limited averments. Therefore, while ultimately a question of law,
Anderson v. Perdue Farms, Inc., 604 F. Supp. 2d 1339, 1349 (M.D. Ala. 2009), further
factual development is warranted before it can be determined whether these uniforms are
truly indispensable to nursing. The court holds that as a uniform maintenance class is not
precluded as a matter of law, and the Defendants’ Motion to Dismiss will be denied as to
the uniform maintenance subclass.
Since the Amended Complaint fails to plausibly allege Defendant Community Health
Systems as an employer under the Fair Labor Standards Act, that Defendant will be
dismissed from this action. Plaintiffs, however, will be given leave to amend the Amended
Complaint to allege further facts as to Community Health System’s employer status.
Further, because uniform maintenance is potentially a compensable preliminary or
Plaintiffs argue that uniform maintenance work is neither preliminary nor
postliminary as it is not “either immediately before or immediately after the scheduled
workday.” Plaintiffs fail to offer, and the Court cannot find, any authority suggesting that
either of these terms requires temporal immediacy. And, though it does not define
postliminary, Black's Law Dictionary defines preliminary as merely "[c]oming before and
usu[ally] leading up to the main part of something." Black's Law Dictionary 1299 (9th ed.
postliminary activity under the Fair Labor Standards Act, the Defendants’ Motion to Dismiss
as to this subclass will be denied. An appropriate order follows.
March 27, 2012
/s/ A. Richard Caputo
A. Richard Caputo
United States District Judge
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