A limo driver believes that he should be paid overtime. He brings a lawsuit on both state and federal wage & hour laws. But he believes that other similarly situated drivers should also be part of his lawsuit.
How does that happen? Well, he asks the court to represent all the other drivers as well. Most people know that as a “class action” but in wage & hour cases, there is also a significant difference too.
A new federal district court case in Connecticut illustrates that exact point fairly well. (You can download the decision in Lassen v. Hoyt Livery here.) In doing so, it also shows the key difference between federal law and state law.
A federal wage & hour claim on behalf of other employee is known as a “collective” action. As the Supreme Court has said, a collective action is “fundamentally different” from a class action brought by the procedural rules set up for federal courts.
Unlike typical class action in which putative class members must opt out in order to remove themselves from the class, a FLSA collective action requires employees to affirmatively opt in to the case in order to join the collective action group.
But here’s where things get interesting, under Connecticut law, an employee who believes he is entitled to overtime, can also bring a claim. These claims can sometimes be brought in federal court too as a supplemental claim to the federal one.
In doing so, these claims are class actionsand not collective actions. Thus, for state wage & hour class actions, the classes are opt-out.
Why is this important? Because in most instances, people do not typically opt out of class actions and are much more likely not to opt in.
In the limo driver case cited above, the court adopted both the collective and class actions into the case, thus requiring an opt-out notice for the state claim, and an opt-in notice for the federal claim.
How that shakes out in that particular case is anybody’s guess, but no doubt it’s a position that employers do not want to be in the first place.
Compliance with wage and hour laws — something I’ve preached for years — should remain a top priority for employers in the coming years.