In Pullen v. McDonald's Corp., Nos. 14-11081, 14-11082, 2014 WL 4610296 (E.D. Mich. Sept. 15, 2014), two groups of plaintiffs filed collective action lawsuits under the Fair Labor Standards Act (“FSLA”) against different owners and operators of McDonald’s restaurants. McDonald’s Corporation was a defendant in both suits. In companion cases before the same judge in the U.S. District Court for the Eastern District of Michigan, the plaintiffs filed Motions for Conditional Certification and Judicial Notice.
The underlying allegations were that, because the plaintiffs were required to wait off the clock either before or after their shifts, or during an extended breaks, and because the costs of their uniforms were deducted from their paychecks, they were compensated less than the minimum wage required by the FLSA. The plaintiffs, in motions that were nearly identical, sought approval to notify over 1,000 “similarly situated” current and former McDonald’s workers. One of the defendants alleged that the number was actually 3,000 such workers who would be notified.
This case was governed by the FLSA. Collective actions under the FLSA are not the same as Federal Rule 23 class actions, although they are similar. Under the FLSA, similarly situated employees must affirmatively opt into collective actions, which is different from the Federal Rule 23 scenario for absent class members. The FLSA certification process occurs in two stages.
A more lenient standard is applied initially for conditional certification. Then, in a FLSA collective action, notifying potential plaintiffs of their ability to participate follows this initial conditional certification. Later, a defendant may move to decertify. This usually occurs after a period for discovery. At that point, the issue is whether the opt-in plaintiffs are in fact similarly situated, decided on the basis of a full evidentiary record.
Olivio v. GMAC Mortgage Corp., 374 F.Supp2d 545, 548 (E.D.Mich. 2004) set forth the standard applied in the McDonald’s case. To be similarly situated, persons must be “victims of a common policy or plan that violated the law” or their “claims [must be] unified by common theories of defendant’s statutory violations, even if the proofs of those theories are inevitably individualized and distinct.”
Here, the uniform price issue was disposed of in part because the defendants agreed at oral argument to reimburse employees when their clothing deductions brought their average hourly pay to below the minimum wage. The Court also noted, however, that some of the alleged class members were under the age of 20, and thus their minimum wage was $3.00 per hour less than that of the rest of the plaintiffs and putative class members. Thus, on both this issue and the clocking-in issue, the Court found that it almost certainly would determine that the plaintiffs were not similarly situated after discovery.
Observing that this would be a large class to notify, the Court stated as follows: “These 1,000 to 3,000 putative class members had varying pay rates, hours worked and deduction methodologies applied to their pay. They worked for different managers at different restaurants; and the wait times are extremely inconsistent, both in terms and duration and frequency.” Thus, the Court denied the Motions for Conditional Certification and Judicial Notice, and denied as moot a motion to strike filed by defendants with respect to the plaintiffs’ briefing.