Before the pandemic (remember then?), you may recall a case last year that drew headlines: Chip’s Family Restaurants was having issues with a class action lawsuit filed against the small chain by allegedly improperly deducting a tip credit from server earnings thereby paying those potential class members below the minimum wage for the performance of
Back in 2011, I wondered aloud: Might the impact of new arbitration decisions from the U.S. Supreme Court bring about the end to big wage & hour class actions?
At the time, I said it would be premature.
Seven years later – what’s changed?
Well, as it turns out, wage & hour class actions
In an important 5-4 decision, the U.S. Supreme Court this morning held, for the first time, that class or collective action waivers, particularly in wage/hour cases, and contained in arbitration agreements between employers and employees are valid and enforceable.
Because wage and hour class and collective actions are quite costly for employers to defend
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.
Continuing my series of posts this week on recent Second Circuit FLSA cases, today I’ll talk about class action waivers and arbitration clauses.
If that last clause is just legalese to you, let me try to walk you through it and why employers
Last week, while most of us were focused on the events in Boston, the U.S. Supreme Court came down with a notable decision last week involving a wage & hour class action (it’s actually called a “collective” action, but for the non-lawyers out there, just think of it as a class action) and what should happen when a class representative fails to accept an offer to compromise by the employer that would have made the plaintiff “whole”.
Before you get too excited, its worth noting to the human resources professional out there that it’s hard to see how this case is going to change the day-to-day advice you are giving. This Supreme Court’s decision is one only a lawyer could love.
But the case is important for employers and lawyers, because it provides another tool to use in defending against wage & hour claims.
Indeed, combined with the court’s recent decisions limiting class actions (see Comcast Corp v. Behrand case) and enforcing arbitration provisions (see AT&T v. Concepcion line of cases), it demonstrates how the court system is grappling with an increasing number of wage & hour claims that threaten to overwhelm the system.
The Symczyk case has been neatly recapped in the Employment Class Action blog here:
The plaintiff brought FLSA claims challenging the employer’s use of an “auto-deduct” policy for meal periods. Along with its answer, the defendant made a Rule 68 offer to the plaintiff of judgment for $7,500, plus attorney fees and costs to be determined by the court….
When the plaintiff did not respond to the offer, the defendant moved to dismiss the case. The district court dismissed the FLSA claims on the basis of Rule 68 and remanded the remaining state law claims….
The Supreme Court … found that the district court had correctly dismissed the case. Because the plaintiff did not contest that her own personal claim would have been satisfied by the offer, the majority assumed that it did, indeed, moot her individual claim. .
Ultimately, the Court held that an offer of judgment under Rule 68 that satisfies the representative plaintiff’s claims moots a potential collective action under the FLSA.
Continue Reading Offers of Judgment in FLSA Collective Actions: Another Tool for Wage & Hour Claims
Suppose you have your employees’ sign agreements to arbitrate all of their employment disputes. (I’ve talked about arbitration agreements in many posts before.)
Can you have an arbitration agreement that says that an employee is precluded from bringing a Title VII (race or gender discrimination) class action claim in Court?
Employees have argued that
At 47 pages, U.S. District Court Judge Hall’s decision last week in Costello v. Home Depot USA (download here) denying an employer’s motion for summary judgment in an overtime case, isn’t exactly a light read.
She is, of course, not to blame. The
Ever wonder what happened to the case of the “exotic dancers” who claimed that they were misclassified as independent contractors?
Well, the case continues and yesterday, the federal court denied a summary judgment filed the strip club on a technical issue that is probably overlooked by employers in many instances. You can download the
Last year, I talked a lot about a U.S. Supreme Court case that seemed to open the door for employers to use mandatory arbitration agreements that precluded employees from using class actions to sue their employers.
But I noted at the time that this was a quickly shifting landscape.
A few days ago, the NLRB