Walker et al v. HongHua America, LLC
Filing
25
MEMORANDUM AND ORDER GRANTING IN PART AND DENYING IN PART 10 Opposed MOTION to Certify Class.(Signed by Judge Keith P Ellison) Parties notified.(sloewe)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
BOBBY WALKER, PAUL FRAZIER, §
DAVID FRED MEHAFFEY II, JUAN
§
GARCIA, BRODERICK MCCLOUD,
§
MICHAEL WEATHERSBY, EDGAR
§
SANCHEZ, and JAVIER PINEDA, et al., §
§
Plaintiffs,
§
§
VS.
§
§
HONGHUA AMERICA, LLC,
§
§
Defendant.
§
Civ. Action No. 4:12-cv-00134
MEMORANDUM AND ORDER
Before the Court is Plaintiffs’ Motion to Conditionally Certify a Collective Action
and to Issue Notice (“Motion”). (Doc. No. 10.) After considering the Motion, all responses
and replies thereto, and the applicable law, the Court concludes that the Motion should be
GRANTED in part and DENIED in part.
I. FACTS
In January 2012, Bobby Walker (“Walker”), Paul Frazier (“Frazier”), David Fred
Mehaffey II (“Mehaffey”), Juan Garcia (“Garcia”), Broderick McCloud (“McCloud”),
Michael Weathersby (“Weathersby”), Edgar Sanchez (“Sanchez”), and Javier Pineda
(“Pineda”) (collectively, “Plaintiffs”) filed this lawsuit against HongHua America, LLC
(“HongHua” or “Defendant”), alleging violations of the Fair Labor Standards Act, 29
U.S.C. § 201 et seq. (“FLSA”). (Doc. No. 1, Pl.’s Compl. ¶ 1.) Defendant, an American
subsidiary of a Chinese company, designs and manufactures land rigs and offshore drilling
modules. (Id. ¶ 18.) Walker, Frazier, Mehaffey, and Garcia were employed by Defendant
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as Crane Operators. (Id. ¶¶ 6-7.) McCloud, Weathersby, Sanchez, and Pineda worked for
Defendant as Roughneck/Riggers. (Id. ¶¶ 10-13.)
Plaintiffs claim that Defendant systematically labeled many of its employees
“independent contractors” so that it could avoid paying them overtime as required by the
FLSA, 29 U.S.C. § 207(a)(1). (Id. ¶ 1.) Although there are exemptions to § 207(a)(1)’s
requirements, Plaintiffs insist that none of these exemptions applied to them. (Id. ¶ 47.)
Consistent with its policy, Defendant allegedly misclassified Plaintiffs as independent
contractors and paid them “straight-time overtime” when they worked over 40 hours in a
workweek, rather than the time and one-half specified in the FLSA. (Id. ¶ 2.) According to
Plaintiffs, Defendant fired Walker and Frazier when they complained about not being paid
time and one-half. (Id. ¶ 3.) Plaintiffs aver that Defendant’s violations of the FLSA were
blatant and willful. (Id. ¶ 41.) Consequently, Plaintiffs seek to recover unpaid overtime
wages due to them and their similarly situated former coworkers. (Id. ¶ 5.) Additionally,
Walker and Frazier bring suit for retaliatory termination in violation of the FLSA’s antiretaliation provision, 29 U.S.C. § 215(a)(3).1 (Id.) In their Complaint, Plaintiffs explain
that they seek to represent a class under 29 U.S.C. § 216(b)2 on behalf of: “All current and
1
Section 215(a)(3), 29 U.S.C. provides that “it shall be unlawful for any person … to discharge or in any
other manner discriminate against any employee because such employee has filed any complaint or instituted
or caused to be instituted any proceeding under or related to this chapter, or has testified or is about to testify
in any such proceeding…”
2
Section 216(b), 29 U.S.C. explains that an employer who violates § 207 of the FLSA is liable to employees,
who may bring the action on behalf of themselves and those similarly situated:
An employer who violates the provisions of section 206 or section 207 of this title shall be
liable to the employee or employees affected in the amount of their unpaid minimum
wages, or their unpaid overtime compensation, as the case may be, and in an additional
equal amount as liquidated damages…. An action to recover the liability prescribed … 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. 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….
2
former Crane Operators and Roughneck/Riggers who were employed by HongHua during
the three-year period preceding the filing of this complaint.” (Id. ¶ 72.)
Plaintiffs filed this Motion, seeking to conditionally certify their proposed class.
(Doc. No. 10.) Defendant filed a Response (Doc. No. 20) and a Sur-Reply (Doc. No. 24).
Plaintiffs filed a Reply (Doc. No. 22).
II. LAW
Under § 207(a) of the FLSA, covered employers are required to compensate
nonexempt employees at overtime rates for time worked in excess of statutorily-defined
maximum hours. Section 216(b) provides a right of action for employees against
employers who violate § 207. Similarly situated employees can “opt-in” to a lawsuit under
§ 207(a) to benefit from a judgment. Holbrook v. Smith & Hawken, Ltd., 246 F.R.D. 103,
105 (D. Conn. 2007). Courts recognize two methods for determining whether to authorize
notice to similarly-situated employees: the spurious class action Shushan approach, or the
two-step Lusardi approach. Aguirre v. SBC Communications, Inc., No. H-05-3198, 2006
U.S. Dist. LEXIS 22211, at *14 (S.D. Tex. April 11, 2006) (citing Shushan v. Univ. of
Colo. at Boulder, 132 F.R.D. 263 (D. Colo. 1990); Lusardi v. Xerox Corp., 118 F.R.D. 351
(D.N.J. 1987)). The Fifth Circuit has not determined which method is more appropriate,
Mooney v. Aramco Servs. Co., 54 F.3d 1207, 1216 (5th Cir. 1995), but most courts use the
Lusardi approach, including this one, Aguirre, 2006 U.S. Dist. LEXIS 22211, at *14. See
also Detho v. Asia Bilal, No. H-07-2160, 2008 U.S. Dist. LEXIS 29502, at *5 (S.D. Tex.
April 10, 2008); Johnson v. Big Lots Stores, Inc., Nos. 04-3201, 05-6627, 2007 WL
5200224, at *3 (E.D. La. Aug. 21, 2007) (“Since Mooney district courts in the Fifth Circuit
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have uniformly used [the Lusardi approach] to determine whether a collective [action]
should be certified under the FLSA.”).
Under the first step of the Lusardi analysis, courts decide whether to issue notice to
potential class members. Aguirre, 2006 U.S. Dist. LEXIS 22211, at *14. As the court’s
decision is usually based only on the pleadings and affidavits, the standard is lenient and
typically results in conditional certification. Id. at *14-15. Indeed, as discovery usually has
not been conducted at this stage, courts do not review the underlying merits of the action in
determining whether to conditionally certify. Colson v. Avnet, Inc., 687 F.Supp.2d 914,
2010 U.S. Dist. LEXIS 12620, at *28 (D. Ariz. 2010). “Some courts place an emphasis on
finding ‘some identifiable facts or legal nexus [that] binds the claims so that hearing the
cases together promotes judicial efficiency.’” Aguirre, 2006 U.S. Dist. LEXIS 22211, at
*15 (quoting Barron v. Henry County Sch. Sys., 242 F.Supp.2d 1096, 1103 (M.D. Ala.
2003)). “‘A court may deny plaintiffs’ right to proceed collectively if the action arises from
circumstances purely personal to the plaintiff, and not from any generally applicable rule,
policy, or practice.’” Id. (quoting England v. New Century Fin. Corp., 370 F.Supp.2d 504,
507 (M.D. La. 2005)). Specifically, “[t]he first-stage test requires a minimal showing by
the plaintiff that (1) there is a reasonable basis for crediting the assertions that aggrieved
individuals exist, (2) that those aggrieved individuals are similarly situated to the plaintiff
in relevant respects given the claims and defenses asserted, and (3) that those individuals
want to opt-in to the lawsuit.” Id. at *19; Albanil v. Coast 2 Coast, Inc., No. H-08-486,
2008 WL 4937565, at *6 (S.D. Tex. Nov. 17, 2008) (quoting Maynor v. Dow Chem. Co.,
No. G-07-504, 2008 WL 2220394, at *6 (S.D. Tex. May 28, 2008)). “Some factual support
for the complaint allegations of class-wide policy or practice must be shown to authorize
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notice.” Maynor, 2008 WL 2220394, at *6. Notably, “[c]ollective actions under the FLSA
are generally favored because such allegations reduce litigation costs for the individual
plaintiffs and create judicial efficiency by resolving in one proceeding [all] ‘common
issues of law and fact arising from the same alleged … activity.’” Ryan v. Staff Care, Inc.,
497 F.Supp.2d 820, 823 (N.D. Tex. 2007) (quoting Hoffmann-La Roche, Inc. v. Sperling,
493 U.S. 165, 170, 110 S.Ct. 482, 107 L.Ed.2d 480 (1989)).
Once a court conditionally certifies a class, the action proceeds as a collective
action during discovery. Aguirre, 2006 U.S. Dist. LEXIS 22211, at *16 (citing Mooney, 54
F.3d at 1214). At the second stage of the analysis, the defendant moves to “decertify” the
conditionally-certified class. Id. (citing Mooney, 54 F.3d at 1214). The court then must
make a factual determination as to whether the employees are similarly situated; if it so
finds, the collective action may proceed. Id. at *16-17. Alternatively, if the court finds that
the employees are not similarly situated, the opt-in plaintiffs are dismissed without
prejudice and the original plaintiffs proceed with their individual claims. Id. at *17 (citing
Mooney, 54 F.3d at 1214).
III. ANALYSIS
Utilizing the Lusardi analysis, the Court concludes that conditional certification is
warranted. However, the Court finds that it is appropriate for the case to proceed with two
classes: one class consisting of Crane Operators, and a second class consisting of
Roughneck/Riggers. Also, although Plaintiffs may issue notice to workers beginning three
years prior to the date of this Memorandum and Order, the end date must be set as January
12, 2012, when Defendants refashioned their overtime policy by hiring individuals from a
third-party staffing company.
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A. Parties’ Briefing
In the Motion, Plaintiffs request that the Court conditionally certify a collective
action and authorize Plaintiffs to issue “opt-in” notices to similarly situated Crane
Operators and Roughneck/Riggers who have performed work for Defendant over the past
three years without receiving overtime pay. (Doc. No. 10, Mot. Certify at 2.) Plaintiffs
contend that conditional certification is proper because the Plaintiffs and their fellow Crane
Operators and Roughneck/Riggers:
•
All worked at the same location in Houston, Texas;
•
All worked in one of two job categories, either as Crane Operators or
Roughneck/Riggers, performing the same essential jobs under similar relevant
conditions;
•
All worked a lot of overtime;
•
All were misclassified as “independent contractors” and thus were not paid
overtime compensation that they were entitled to receive under the FLSA;
(Id. at 3.) Plaintiffs observe that other similarly situated individuals exist because, as
explained in multiple affidavits, there are probably more than twenty other Crane
Operators and two hundred Roughneck/Riggers who have worked for Defendant in the
past three years. (Id. at 13.) Additionally, Plaintiffs contend that there is ample proof that
other persons want to join the case; indeed, twelve more Plaintiffs have opted into this case
since it was filed, bringing the number of total Plaintiffs to twenty. (Id. at 3.) Plaintiffs
explain that they share, with putative opt-in Plaintiffs, a common work location, job duties,
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job conditions, and job titles. (Id. at 15.) According to Plaintiffs, these facts render them “a
cohesive and homogenous group all subject to the same policy and practice (i.e., deprived
of overtime they all worked based on one common alleged exemption) that fit perfectly
within the letter and spirit of the FLSA collective action.” (Id. at 14.)
Defendant disputes that conditional certification is warranted here. According to
Defendant, the core issue in this case—contractor versus employee status—is clearly not a
question that lends itself to determination as a collective action. (Resp. to Mot. Certify at
2.) Defendant urges that the Plaintiffs were independent contractors pursuant to the
economic realities test. (Id. at 16.) Additionally, Defendant argues, the Court would have
to undergo an independent analysis as to each employee, taking into account their diverse
professional histories, experiences, services, skill, initiative, investments in tools and
equipment, time periods worked, and sources of income. (Id. at 16-20.) In other words,
Defendant contends, as these unique patterns would have to be investigated for each
worker, a collective action would be ineffective and unwieldy. (Id. at 20.) If the Court
chooses to conditionally certify, however, Defendant requests that the Court narrow the
personal information about workers that could be divulged to Plaintiffs’ counsel. (Id. at
21.) Defendant also asserts that the Court should treat Crane Operators and
Roughneck/Riggers separately. (Id. at 23.) Finally, Defendant requests various changes to
Plaintiffs’ proposed notice. (Id. at 23-25.)
In their Reply, Plaintiffs claim that Defendant itself treated the putative Plaintiffs as
similarly situated—by making them all employees of Orin Staffing in January 2012, so
that they now receive overtime pay under the FLSA. (Reply to Mot. Certify at 4.) Plaintiffs
urge that Defendant’s merits-based arguments are inappropriate at the conditional
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certification stage of an FLSA action. (Id. at 5.) Additionally, Plaintiffs believe that
judicial efficiency in fact favors conditional certification. (Id. at 7.) Defendant filed a SurReply in which it insists that Plaintiffs misapply the law concerning conditional
certification. (Sur-Reply to Mot. Certify at 3.) Defendant points out that courts have
refused to conditionally certify FLSA suits if the individualized inquiries required would
eliminate the “economies of scale envisioned by the FLSA collective action procedure”—
the exact scenario, Defendant asserts, that is before this Court. (Id. at 4.) According to
Defendant, its arguments are not merit-based; rather, as “the question of whether or not to
conditionally certify a class depends upon whether the named and putative plaintiffs are
contractors or employees,” Defendant’s arguments should be considered at this stage of the
proceeding. (Id. at 9.) Finally, Defendant emphasizes that the proposed notice is flawed
because it is designed to create the perception that (a) the Court has endorsed the merits of
the suit, (b) there is money to be had by joining, (c) the recipient will not be able to recover
if they do not participate, and (d) all roads to the money go through the office of Plaintiffs’
attorney. (Id. at 10.)
B. Reasonable Basis for Crediting Assertions that Aggrieved
Individuals Exist
Plaintiffs have met their burden of showing that there is a reasonable basis for
assuming that other aggrieved individuals exist. According to affidavits presented by
Plaintiffs, as many as twenty Crane Operators (Doc. No. 10-2, Paul Frazier Aff. ¶ 5) and
two hundred Roughneck/Riggers (Doc. No. 10-3, Broderick McCloud Aff. ¶ 5; Doc. No.
10-4, Javier Pineda Aff. ¶ 5) have worked for Defendant over the past three years. Indeed,
there were as many as five Crane Operators (Frazier Aff. ¶ 3) and seventy
Roughneck/Riggers (McCloud Aff. ¶ 3; Pineda Aff. ¶ 3) at any one time. Furthermore,
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Plaintiffs understood that these other Crane Operators and Roughneck/Riggers were not
paid overtime. (Frazier Aff. ¶ 5; McCloud ¶ 5; Pineda ¶ 5.) Together, these affidavits are
sufficient to demonstrate a reasonable basis for crediting Plaintiffs’ assertion that other
aggrieved individuals exist.
C. Aggrieved Individuals Are Similarly Situated to Plaintiffs in
Relevant Respects Given the Claims and Defenses Asserted
Plaintiffs seek to conditionally certify a class consisting of employees from two
different positions: that of Crane Operator, and that of Roughneck/Rigger. Plaintiffs
present evidence that Crane Operators were responsible for operating cranes. (Frazier Aff.
¶ 2.) Plaintiffs also show that Roughneck/Riggers “all did the same thing at the same
location: heavy labor assembling and disassembling rigs for HongHuga at its 35,000
square foot warehouse fabrication show and 20-acre rig-up facility located at 8300 McHard
Road, Houston, Texas 77053.” (McCloud Aff. ¶ 3; Pineda Aff. ¶ 3.) According to
Plaintiffs, the Roughneck/Rigger job “is not skilled work—it is just straight-up hard
labor.” (McCloud Aff. ¶ 3.) Defendant points out that, in contrast, the Crane Operators
have specialized training and experience, and are certified to operate cranes. (Ex. A to Mot.
Certify, Estela V. Moscot Aff. ¶ 13.)
“For the class representative to be considered similarly situated to the potential opt
in class members, the class representative must be similarly situated in terms of job
requirements and similarly situated in terms of payment provisions.” Ryan, 497 F.Supp.2d
at 825 (citing Dybach v. State of Florida Dept. of Corrections, 942 F.2d 1562, 1567-68
(11th Cir. 1991)). Plaintiffs “need only show that their positions are similar, not identical,
to putative plaintiffs.” Jesiek v. Fire Pros, Inc., 275 F.R.D. 242, 246 (W.D. Mich. 2011).
See also England v. New Century Financial Corporation, 370 F.Supp.2d 504, 507 (M.D.
9
La. 2005) (“Similarly situated does not necessarily mean identically situated.” (footnote
omitted)). “Slight differences in job duties or functions do not run afoul of the similarly
situated requirement.” Tolentino v. C&J Spec-Rent Services, Inc., 716 F.Supp.2d 642, 651
(S.D. Tex. 2010). However, “if the job duties among potential members of the class vary
significantly, then class certification should not be granted.” Dreyer v. Baker Hughes
Oilfield Operations, Inc., No. H-08-1212, 2008 WL 5204149, at *2 (S.D. Tex. Dec. 11,
2008) (citing Harris v. Fee Transp. Servs., No. Civ.A.3:05CV0077-P, 2006 WL 1994586,
at *5 (N.D. Tex. May 15, 2006) (noting the “significant” differences between the job
duties of potential plaintiffs); Aguirre v. SBC Commc’ns, Inc., No. H-05-2198, 2007 WL
772756, at *9 (S.D. Tex. Mar. 12, 2007) (noting that plaintiffs are not similarly situated if
their job duties vary “substantially”)); Johnson, 2007 WL 5200224, at *9 (“The Court
recognizes that there are some differences between plaintiffs’ employment experiences as
assistant managers. But the terms of the FLSA’s collective action provision allow for
differences. To pursue claims against an employer, plaintiffs must be similarly situated.
They do not have to be identically situated.” (emphasis in original)).
Examining Plaintiffs’ Motion and the attached affidavits, as well as Defendant’s
briefing, it is clear that the Crane Operators and Roughneck/Riggers performed
significantly different job duties. See, e.g., Dreyer, 2008 WL 5204149, at *2 (“But, though
Dreyer and Stewart valiantly argue that these employees are similar to them because they
also respond to user queries regarding computer hardware problems, this similarity is too
abstract. The evidence shows that IT workers in the Customer Services Group are
principally responsible for providing technical support for users of desktop personal
computers, including the software that runs on them. This type of work is fundamentally
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different from the more complex server-side work that Dreyer and Stewart performed.”).
Their tasks, skill level, and prior experience differ in important ways, such that Crane
Operators and Roughneck/Riggers could not be similarly situated to one another.3
Nor is this a case where the division between the two positions is porous, Jesiek,
275 F.R.D. at 247 (“On this record, the distinction between ‘installers’ and ‘technicians’ is
not set in stone. Field employees move between the two employee categories as needed.
The Court is mindful that the burden on Plaintiffs here is lenient. Omitting technicians
from the opt-in employee class would potentially exclude individuals who worked as
installers for only one or two jobs.”), or where the job titles were different, but the actual
tasks identical, Prater v. Commerce Equities Management Co., Inc., No. H-07-2349, 2007
WL 4146714, at *6 (S.D. Tex. Nov. 19, 2007) (“The plaintiffs have made the necessary
minimal showing that they and other leasing staff employees are similarly situated in terms
of job requirements. Although [defendant’s] affidavit states that the plaintiffs had different
positions and different duties, the plaintiffs assert in their affidavits that they all performed
the same duties of a leasing agent and ‘all did the same thing which included performing
leasing, administrative, and marketing tasks.’”). Indeed, the two positions require
“different equipment and a different composition of work crews.” Tolentino, 716
F.Supp.2d at 651. Thus, despite the fact that all Plaintiffs worked at the same facility, it is
3
In fact, Crane Operators appear to have had a specialty in their field, which merely adds weight to the fact
that they were not similarly situated to Roughneck/Riggers. Indeed, any possible category that would
encompass both Crane Operators and Roughneck/Riggers would be too generic. Villareal v. St. Luke’s
Episcopal Hospital, 751 F.Supp.2d 902, 919 (S.D. Tex. Nov. 3, 2010) (“Plaintiffs state that all of the
employees working in IT Services had ‘a common purpose, which is to help the use of computers and
computer related equipment, at various departments of St. Luke’s, to get the most performance from their
computers and to overcome problems or obstacles.’ However true this may be, the generic quality of this
statement creates a far broader categorization than that permitted under the ‘similarly-situated’ analysis….
Generally speaking, TSC employees dealt with fixing the computer issues that arose on a daily basis at St.
Luke’s; the other four groups specialized in the implementation of and maintenance of specific software or
hardware issues…. This specialization prevents the court from finding that employees in those groups are
similarly situated to those employees who worked in the TSC.”).
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clear that Crane Operators and Roughneck/Riggers were not similarly situated in terms of
job requirements. Morales v. Thang Hung Corp., No. 4:08-2795, 2009 WL 2524601, at *3
(S.D. Tex. Aug. 14, 2009) (“[Plaintiff’s] description of the class includes supermarket
management, seafood counter workers, and presumably many other classes of supermarket
employees.… [Plaintiff] has not shown that the Supermarket management members are
similarly situated to the other employees of the supermarket, and common practice would
indicate that they are not.”).
The Court does determine, however, that Crane Operators and Roughneck/Riggers
are similarly situated within their respective positions. Crane Operators worked at the same
facility, operated cranes, and were subject to a policy of not being paid overtime. (Frazier
Aff. ¶¶ 2, 3, 5.) Roughneck/Riggers performed heavy labor and disassembled drill rigs for
Defendant at the same facility, and were subject to a policy of not being paid overtime.
(McCloud Aff. ¶¶ 2, 3, 5; Pineda Aff. ¶¶ 2, 3, 5.) Defendant asserts that these groups are
not homogenous. (Moscot Aff. ¶¶ 13-14.) Discovery may show that Crane Operators and
Roughneck/Riggers are not similarly situated within their respective groups. Nonetheless,
at this preliminary stage, Plaintiffs can survive the similarly situated analysis as to each
position.
The Court disagrees with Defendant’s conclusion that FLSA cases concerning
employee versus independent contractor status are inherently ill-suited to collective action
treatment. Contrary to Defendant’s assertion, many courts have granted conditional
certification in FLSA cases involving disputes over whether workers were misclassified as
independent contractors. See Ruffin v. Entertainment of the Eastern Panhandle, No. 3:11–
CV–19, 2012 WL 761659, at *5 (N.D. W.Va. March 7, 2012); Lang v. DirecTV, Inc., No.
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10–1085 “G”(1), 2011 WL 6934607 (E.D. La. Dec. 30, 2011); Perez v. Comcast, No. 10 C
1127, 2011 WL 5979769 (N.D. Ill. Nov. 29, 2011); Guifu Li v. A Perfect Franchise, Inc.,
No. 5:10-CV-01189-LHK, 2011 WL 4635198 (N.D. Cal. Oct. 5, 2011); Scovil v. FedEx
Ground Package System, Inc., 811 F.Supp.2d 516 (D. Me. 2011); Johnson v. ECT
Contracting, LLC, No. 3:09-0130, 2010 WL 625390 (M.D. Tenn. Feb. 18, 2010). Indeed,
Defendant’s “argument borders on specious—members of the proposed class[es] all hold
the same job title, have the same job responsibilities, work at the same locations, and, by
extension are subject to the same ownership and management.” In re Penthouse Executive
Club Compensation Litig., No. 10 Civ 1145(NRB), 2010 WL 4340225, at *4 (S.D.N.Y.
Oct. 27, 2010). “If such a group does not merit at least preliminary class treatment, one
would expect that class treatment would rarely be granted in FLSA actions, a proposition
that is plainly incorrect as an empirical matter.” Id.
Nonetheless, courts are split as to whether the economic realities test should be
utilized when determining whether to conditionally certify an FLSA action concerning an
allegedly wrongful independent contractor designation. To determine whether a worker is
an employee or an independent contractor, “courts in this Circuit ‘generally use as a guide
five, non-exclusive factors: (a) the permanency of the relationship; (b) the degree of
control exercised by the alleged employer; (c) the skill and initiative required to perform
the job; (d) the extent of the relative investments of the worker and the alleged employer;
and (e) the degree to which the worker’s opportunity for profit and loss is determined by
the alleged employer.’” Andel v. Patterson-UTI Drilling Co., LLC, No. V–10–36, 2012
WL 531167, at *2 (S.D. Tex. Feb. 15, 2012) (quoting Tibault v. Bellsouth
Telecommunications, Inc., 612 F.3d 843, 846 (5th Cir. 2010)). Some courts have
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undergone the independent contractor versus employee analysis, called the economic
realities test, in determining whether to issue conditional FLSA certification. Id.; Scott v.
Bimbo Bakeries, USA, Inc., No. 10-3154, 2012 WL 645905, at *7 (E.D. Pa. Feb. 29, 2012)
(“In independent contractor mis-classification cases such as the case before us, district
courts are divided as to what type of evidence is relevant in considering whether the named
and potential plaintiffs are similarly situated. Some courts view the evidence of similarity
in light of all of the factors used to determine whether an individual is an ‘employee’ under
the FLSA. In a second, different approach, other courts simply consider whether the
plaintiffs have presented evidence of general similarities across the proposed class….
Lastly, there are courts who borrow from each of these approaches….” (footnotes
omitted)); Demauro v. Limo, Inc., No. 8:10-cv-413-T-33AEP, 2011 WL 9191, at *3-4
(M.D. Fla. Jan. 4, 2011); Kerce v. West Telemarketing Corp., 575 F.Supp.2d 1254, 1360
(S.D. Ga. 2008). Others have refused to apply the analysis at the preliminary stage of
FLSA certification. See, e.g., Scovil v. FedEx Ground Package System, Inc., 811 F.Supp.2d
516, 518-19 (D. Me. 2011) (“Many courts considering conditional certification under the
FLSA have not applied the economic realities factors in determining whether proposed
class members are similarly situated. But other courts have used the factors to determine
whether proposed class members are similarly situated under the FLSA.” (citing cases));
Putnam v. Galaxy 1 Marketing, Inc., 276 F.R.D. 264, 274 (S.D. Iowa 2011) (“Defendants
also urge the Court to look to the ‘economic realities’ of the working relationship—not
merely characterization as an independent contractor or employee—and find that there is
not enough similarity among the putative class members…. Making a determination, at
this time, of whether the satellite installation technicians were independent contractors or
14
employees pursuant to the ‘economic realities’ test, would also improperly delve into the
merits of Plaintiffs’ claim.”); Meseck v. TAK Communications, Inc., No. 10–965
(JRT/AJB), 2011 WL 1190579, at *6 (D. Minn. March 28, 2011) (“Courts in this district
and elsewhere consistently hold that such potential defenses and individualized inquiries[,
such as the economic realities test,] should not prevent conditional certification at the
notice stage and are more appropriately addressed through a decertification motion.”);
Westfall v. Kendle Intern’l, CPU, LLC, 1:05-cv-00118, 2007 WL 486606, at *9 (W.D.
W.Va. Feb. 15, 2007); Lemus v. Burnham Painting and Drywall Corp., No. 2:06-cv01158-RCJ-PAL, 2007 WL 1875539, at *5 (D. Nev. June 25, 2007) (“The fact intensive
inquiries concerning whether the plaintiffs are independent contractors or employees for
the purposes of the FLSA, and detailed analysis of whether the plaintiffs are sufficiently
similarly situated to maintain the class are more appropriately decided after notice has been
given, the deadline to opt in has passed, and discovery has closed.”).
The Court believes that the economic factors test is likely not appropriate for
determination at the first stage of FLSA class certification. Even if the test applies,
however, Plaintiffs have presented sufficient evidence that they are similarly situated under
the five factors within the respective positions of Crane Operator and Roughneck/Rigger.
Specifically, Plaintiffs have put forth evidence, albeit minimal, that they are: similarly
situated to other members of each position in terms of their relationship to Defendant, the
skill required to perform their positions, the extent of their investments and Defendant’s
investments, and the degree to which their opportunity for profit and loss is determined by
the alleged employer.
D. Those Individuals Want to Opt In to the Lawsuit
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Many courts have determined that plaintiffs do not need to present evidence that
potential opt-in plaintiffs desire to opt-in. Jesiek, 275 F.R.D. at 247 (“Plaintiff’s failure to
provide evidence that potential opt-in plaintiffs’ desire to opt-in is not fatal to their
motion.”); Villarreal v. St. Luke’s Episcopal Hospital, 751 F.Supp.2d 902, 915 (S.D. Tex.
2010) (“The court agrees that a plaintiff need not present evidence at this stage of the third
element, that aggrieved individuals actually want to opt in to the lawsuit.”). Other courts
require a showing of at least a few individuals want to join. Simmons v. T-Mobile, No. H06-1820, 2007 WL 210008, at *9 (S.D. Tex. Jan. 24, 2007) (“The Court concludes that a
showing is necessary that at least a few similarly situated individuals seek to join the
lawsuit. Others’ interest in joining the litigation is relevant to deciding whether or not to
put a defendant employer to the expense and effort of notice of a conditionally certified
class of claimants in a collective action.”). If such a requirement does exist, Plaintiffs have
amply met it. The litigation has already attracted numerous new Plaintiffs. McKnight v. D.
Houston, Inc., 756 F.Supp.2d 794, 805 (S.D. Tex. 2010) (“This litigation has already
attracted six plaintiffs. The plaintiffs have produced sufficient evidence to show that other
aggrieved [employees] … would want to join the collective action.”); Prater, 2007 WL
4146714, at *8. Additionally, Plaintiffs explain in their affidavits that other individuals
would likely seek to opt in. Plaintiffs have made a showing that other potential Plaintiffs
desire to opt-in.
E. Conditional Class Certification
This Court “has the power to modify an FLSA collective action definition on its
own.” Dreyer, 2008 WL 5204149, at *3 (citing Baldridge v. SBC Commc’ns, Inc., 404
F.3d 930, 931-32 (5th Cir. 2005)). See also Green v. Plantation of La., LLC, No. 2:10-
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0364, 2010 WL 5256354, at *10 (W.D. La. Nov. 24, 2010) (“As in the class-action
context, this court has the power to modify an FLSA collective action definition on its
own.”); Kaluom v. Stolt Offshore, 373 F.Supp.2d 866, 873-74 (S.D. Tex. Feb. 7, 2007)
(“[W]hile the Court agrees that Plaintiff’s proposed class may currently be too broad, it
does not agree that this overbreadth defeats Plaintiff’s Motion for Notice. Rather, the just
result is to allow notice, but to limit discovery and notice to only those workers who are
similarly situated.”). As Plaintiffs meet the requirements of the Lusardi analysis, the Court
concludes that it appropriate to conditionally certify two separate classes, one of Crane
Operators and the other of Roughneck/Riggers. See, e.g., Matthews v. ALC Partner, Inc.,
No. 2:08-CV-10636, 2009 WL 2591497, at *5 (E.D. Mich. Aug. 24, 2009) (“Within the
groups of Managers, Assistant Managers, and Technicians, the plaintiffs’ accounts of their
job duties, although admittedly somewhat generalized, are almost identical. Accordingly,
the Court is satisfied that differences in the plaintiffs’ job descriptions can be addressed by
certification of three different classes, broken down generally along these lines.”); Prater,
2007 WL 4146714, at *8 (granting motion for notice as to two subclasses of employees:
leasing agents paid on an hourly basis, and other apartment office employees paid on a
salary basis). A three-year notice period is appropriate, as “[t]he well-established precedent
of the Southern District of Texas indicates that, where a plaintiff alleges a willful FLSA
violation, notice is proper for potential class members employed by the defendant within
the full three-year period; FLSA plaintiffs are not required to prove willfulness prior to
discovery.” Albanil, 2008 WL 4937565, at *8 (citing Lopez v. Sam Kane Beef Processors,
Inc., No. CC-07-335, 2008 WL 565115, at *2 (S.D. Tex. Feb. 29, 2008); Foraker v.
Highpoint Southwest Services, L.P., No. H-06-1856, 2006 WL 2585047, at *5 (S.D. Tex.
17
Sept. 7, 2006); Villatoro v. Kim Son Restaurant, L.P., 286 F.Supp.2d 807, 811 (S.D. Tex.
2003)).
The Court finds, however, that Defendant’s policy changed on January 12, 2012.
The “policy change demonstrates that those employed by Defendant [after January 12,
2012] are not ‘similarly situated’ to those employed before that time, as they are not
together ‘victims of a single decision, policy, or plan,’ regardless of whether FLSA
violations continued to occur after that time.” Tolentino, 716 F.Supp.2d at 654-55. Thus,
the class period must end on that date. The Court also agrees with Defendant that the class
should be limited to potential Plaintiffs who were classified as independent contractors;
otherwise, the potential Plaintiffs would not all be subject to the same policy or practice.
The Court further agrees with Defendant that Plaintiffs’ request for data about
potential class members is too broad. The Court requires Defendant to produce, in usable
electronic format, within seven days of the date of the Order: the names, last known
personal and work addresses, personal and work email addresses, and dates of work of all
persons who performed work for Defendant as Crane Operators or Roughneck/Riggers at
any time between May 7, 2009 and January 12, 2012. The information should be verified
as complete and accurate by one of Defendant’s corporate representatives. Finally, the
Court orders the parties to confer about the content of the notice, and to provide the Court
with a proposed notice within 14 days of the date of this Order. Additionally, the parties
should confer about the proper method for distribution and return of the notices. If the
parties cannot agree upon either of these issues, they must each file their proposed notice
and proposed method of distribution and return.
IV. CONCLUSION
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For the reasons discussed above, Plaintiff’s Motion is GRANTED in part and
DENIED in part. The Court conditionally certifies the following two classes:
•
All current and former Crane Operators who were classified as independent
contractors, were not paid overtime pay at the rate of one and one-half times their
regular hourly rate, and were employed by Defendant at any time between May 7,
2009 and January 12, 2012.
•
All current and former Roughneck/Riggers who were classified as independent
contractors, were not paid overtime pay at the rate of one and one-half times their
regular hourly rate, and were employed by Defendant at any time between May 7,
2009 and January 12, 2012.
IT IS SO ORDERED.
SIGNED at Houston, Texas on this the 7th of May, 2012.
___________
KEITH P. ELLISON
US DISTRICT COURT JUGDE
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