BAUGHMAN v. KILLION & SONS WELL SERVIE, INC.

Filing 86

ORDER. Defendants' Motion for Summary Judgment 67 is DENIED. For the reasons stated in the paper-Order corresponding to this docket entry, counsel for all parties in this consolidated-litigation have two options: they either may conduct ano ther round of ADR, before a mutually agreed-upon neutral; or they may appear before the undersigned for Court-facilitated mediation. After meeting and conferring, counsel shall, by 1/7/19, file either a standard ADR Stipulation; a stipulation indica ting their preference for Court-facilitated mediation; or, if they cannot reach agreement, they shall file a joint-notice stating each party's position. In the absence of unanimous agreement, the Court will make the final decision. Signed by Judge Cathy Bissoon on 12/17/18. (dcd) (Main Document 86 replaced on 12/17/18, to correct typographical error in originally-filed document) (dcd)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
SETH BAUGHMAN, et al.,
Plaintiffs,
v.
KILLION & SONS WELL SERVICE,
INC.,
Defendant.

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Civil Action No. 15-1143 (lead case)
Judge Cathy Bissoon

ORDER
Defendant’s Motion (Doc. 67) for summary judgment will be denied.
The Court writes only for the benefit of the parties and their counsel. Both the collective
and individual (consolidated) Plaintiffs have put forth evidence and arguments indicating that,
from January 2013 until August or September 2015, Defendant manipulated its pay-practices to
ensure that workers received the same compensation as they did under their former “day-rate,”
a compensation-policy found impermissible by the DOL. Plaintiffs’ evidence, both in the
“macro” and the “micro” (particularly as revealed in the individual Plaintiffs’ briefing) creates a
reasonable, if not strong, inference that Defendant was hostile to the DOL’s determination.
See Pls.’ Opp’n Brs. (Docs. 76 & 79) (citing record evidence). Such hostility appears to be
echoed in the (arguably) passive-aggressive statements in the company’s written announcement
of purported changes. See Def.’s Br. (Doc. 69) at 4 (“In the first couple of years of business we
paid our employees on a Day-Rate system. To us, this seemed a very fair way of payment
because a man could make the same pay on his first day on the job as his last.

Unfortunately for us this is strictly forbidden through the [DOL] rules. We were ordered to pay a
huge amount of money to past and present employees.”) (quoting record evidence).
Counsel’s likely protestations notwithstanding, Plaintiffs’ evidence appears problematic
to Defendant’s positions in many respects. To the extent that changes in pay-policies resulted in
workers, under materially-similar circumstances, making the same net-compensation both before
and after abandonment of the day-rate, this result appears inconsistent with the DOL’s
conclusion that workers were being underpaid in the old system.
Defendant maintains that it remained free to negotiate wage-rates with its employees,
so long as the rates were not artificially-lowered to avoid overtime obligations; and counsel
presents hypothetical scenarios suggesting that Plaintiffs have miscalculated their effective
hourly wage-rates under the old system. See Def.’s Reply Br. (Doc. 82) at 4-5.
Nevertheless, Defendant has made no effort to show whether workers’ wage-rates remained
consistent before and after the “termination” of the day-rate policy. Instead, Defendant offers
broad references to basing workers’ wage-rates on their experience-level and employeenegotiations. At the very least, however, Plaintiffs have demonstrated disputed, material facts
regarding whether their wage-rates were manipulated to bring their net compensation in-line with
the old system. See, e.g., Individ. Pls.’ Opp’n Br. (Doc. 79) (citing examples of how workers’
net-pay, before and after the purported discontinuation of the day-rate, ended up being only
pennies’ different). Crediting Defendant’s blanket-assertions would require a fact-finder to
accept some remarkable coincidences, indeed. 1

1

Workers whose employment pre-dated the changes in compensation-policy surely had at least
the same levels of skill and experience before and after. Should any such worker be able to
demonstrate that his effective wage-rate significantly diminished under the new policies,
this easily could support the conclusion that Defendant artificially-lowered his rate under the
new system (thereby potentially-avoiding overtime liability). Not-lost on the Court is the distinct
2

At the risk of oversimplification, Defendant’s elimination of the day-rate system, all other
factors being equal, should have been expected to result in employees who worked overtime
enjoying an increase in compensation. Defendant certainly has not shown this to be the case;
and Plaintiffs’ evidence is to the contrary.
In the end, the Court has little doubt that Defendant has failed to demonstrate entitlement
to summary judgment on liability. The undersigned must confess, however, that the
individualized-inquiries regarding damages – at trial – appear daunting. 2
To be sure, the Court continues to believe that common issues of fact and law warrant
collective-action treatment, especially as relates to liability. But, how damages determinations
may be made, without degeneration into a series of mini-trials, is harder to envision. On top of
that, there are a number of individual Plaintiffs whose cases – until otherwise ordered –
remain consolidated herewith.

possibility that, because Defendant (purportedly) continued to de facto apply the day-rate,
the workers’ effective hourly wage-rates never were, in fact, contemporaneously established.
Cf. Def.’s Br. (Doc. 69) at 4 (written announcement, stating that, at the time of the initial
DOL-audit, “we were told to adopt a regular rate of pay for all employees and to pay a minimum
of 1.5 times [the] regular rate for any hours over 40 in a work week”) (emphasis added).
While this would not-necessarily inure to the benefit of Defendant in every instance, any failure
on Defendant’s part certainly cannot be held to the legal-detriment of Plaintiffs, on summary
judgment or at trial.
2

Presumably, an effective hourly-rate for each individual Plaintiff would need to be determined;
then, the fact-finder would need to discern, based on the number of overtime-hours worked,
how much more the individual-Plaintiff should have been paid. The calculations further would
be complicated by Defendant’s adoption of its standby-time policy, purportedly to bring
workers’ pay in-line with their former day-rates. If such calculations appear challenging to the
Court (and they do), one can only imagine what it might be like for a jury. That something is
difficult does not mean that it cannot, or should not, be done. The Court raises these concerns
only to say – counsel and the parties should know what they are getting into, and proceed with
eyes-open.
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The Court certainly does not mean to invite relitigation of this case’s status as a collective
action. At the Conference establishing summary-judgment procedures, Defendant, through its
counsel, expressly stated that it would not seek decertification. 3 Even had it not, allowing an
eleventh-hour motion would be inconsistent with the intentions manifested by the parties and the
Court. Cf. generally Alig v. Quicken Loans Inc., 2016 WL 10490288, *8 (N.D. W. Va. Aug. 25,
2016) (“defendants should not be permitted to wait and see how the [c]ourt will rule on . . .
summary judgment . . ., and then, after the [c]ourt rules against [them], belatedly seek to
decertify the class on the ground that the [c]ourt should never have followed that procedure in
the first place”) (citation to quoted and other sources omitted). Finally, should concerns
regarding individualized-inquiry so warrant, there remains the prospect of bifurcation.
See Maynor v. Dow Chemical Co., 671 F. Supp.2d 902, 934 (S.D. Tex. 2009) (collecting
authority endorsing bifurcation of liability and damages in FLSA collective actions).
These things notwithstanding, the parties and their counsel should seriously-consider the
wisdom of embarking in protracted jury-proceedings. Given the relatively-small number of
claimants, and the limited time-frame of putative liability, 4 it appears that the parties’ time,
energy and resources would be better-spent in furtherance of alternative-resolution.
Although the Court typically – at this stage − would set trial-related deadlines and
schedule trial, it instead ORDERS as follows. Counsel for all parties in this consolidatedlitigation have two options: they either may conduct another round of ADR, before a mutually
agreed-upon neutral (preferably one with special knowledge and experience regarding FLSA

3

The Conference was held on February 1, 2018. See Conf. Minutes (Doc. 65).

4

See Collective Pls.’ Opp’n Br. (Doc. 76) at 13 (“[t]he practices at issue . . . appear to have
abated” in “August or September of 2015”); Individ. Pls.’ Opp’n Br. (Doc. 79) at 13
(aggrieved-incidents “occurred in 2013 through at least 2015”).
4

collective-actions); or they may appear before the undersigned for Court-facilitated mediation.
After meeting and conferring, counsel shall, by January 7, 2019, file either a standard ADR
Stipulation (available on the Court’s website); a stipulation indicating their preference for Courtfacilitated mediation; or, if they cannot reach agreement, they shall file a joint-notice stating each
party’s position. In the absence of unanimous agreement, the Court will make the final decision.
Consistent with the foregoing, Defendant’s Motion for Summary Judgment (Doc. 67)
is DENIED.
IT IS SO ORDERED.

December 17, 2018

s\Cathy Bissoon
Cathy Bissoon
United States District Judge

cc (via ECF email notification):
All counsel of record

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