BLOGS: Fair Labor Standards Act Law

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Tuesday, January 15, 2008, 11:34 AM

Case Against Starbucks Grinds On

It is often said that the “wheels of justice turn slow.” This can be particularly true in large and complex collective actions brought under the FLSA, where the expense of legal and business resources can be substantial. As one example, in the case of the FLSA collective action in Florida against leading coffee purveyor Starbucks, one might say (to paraphrase many other commentators) that the case continues to percolate slowly through the courts.

More than 3½ years have passed since managers for Starbucks filed suit against the company in federal court in Florida claiming that they were wrongly classified as exempt from the FLSA’s overtime requirements. The case is captioned Pendlebury v. Starbucks Coffee Company, Civil Action No. 9:04-CV-80521, and is pending in the U.S. District Court for the Southern District of Florida. Since the court conditionally certified the case as a collective action on January 3, 2005, more than 900 individuals have joined the case against Starbucks.

As is not surprising in a case this large and complex, the procedural maneuverings continue. On September 27, 2007, after considering lengthy arguments and submissions from both sides, the court denied Starbucks’ motion to have the class decertified, thus ordering the case to proceed as a class action. Since then, on January 3, 2008, the Court denied Starbucks’ motion to obtain summary judgment (i.e., a judgment on the merits of the case before trial) on the claims of two individual plaintiffs in the case. The court noted that the motion had been filed before the final ruling on the class certification, and thus it was not proper to rule upon summary judgment unless the motion addressed the entire class of plaintiffs.

Even though they won, the plaintiffs last week asked the court to reconsider its order. The plaintiffs argued that the court’s order seemed to contemplate that Starbucks could still yet move for summary judgment as to the entire class. The plaintiffs objected on the grounds that the time for summary judgment had passed, and that allowing such motion would even further prolong the case. They argued to the court that “[i]f history in this case is any guide as to the number of extensions of time the parties likely would require as to a summary judgment motion directed to the entire class, Plaintiffs estimate that such a motion may not even be fully briefed for up to three months, not to mention the additional time it would take for the Court to consider the motion.” (Plaintiff’s Motion for Partial Reconsideration, at 4, Jan. 10, 2008.)

The plaintiffs’ motion bears noting because it emphasizes the substantial expenditures of time, effort, costs, and resources that can be required in litigating FLSA collective actions. To date, there have been nearly 500 filings with the court, and it appears that any disposition of this case remains many months away. As such, it is a good reminder for all businesses that it is worthwhile to be proactive, and to take the time and effort periodically to audit their pay practices and the classification of their employees as exempt or non-exempt.

Tuesday, January 8, 2008, 9:58 AM

Commuting Is Not Compensable Time

The Supreme Court has denied review of a December 2006 appellate decision, Adams v. United States, which is the last portion of a long-running dispute between the Government and federal law enforcement officers in the Secret Service, Customs and Border Protection, IRS, ATF and the DEA. Both the trial court (the Court of Federal Claims)and the appellate court (the US Court of Appeals for the Federal Circuit) found that the plaintiffs, who travel to and from work in government-owned police vehicles, are not entitled to pay for the time spent commuting although they are required to have their weapons and other related equipment with them, must be monitoring electronic communications, and are forbidden to perform personal errands.

"Merely commuting in a government-owned vehicle is insufficient" to render the time compensable, said the Federal Circuit. "[T]he plaintiffs must perform additional legally cognizable work while driving to their workplace in order to compel compensation for the time spent driving." Another key aspect of the decision was the conclusion that the plaintiffs had the burden of proving their entitlement to compensation for the travel time. Rejecting their contention that the employer had to establish the "exemption" of the time, the court explained that "exemptions" deal with individuals, not activities; therefore, plaintiffs must be able to show both that they performed work for which they were not compensated, and that "the alleged acts... constitute compensable 'work" at all."

Don't expect this to be the final word on compensable time. The plaintiffs' bar continues to press for expansive definitions of "work time," and the Supreme Court's 2005 decision in IBP v. Alvarez, dealing with some aspects of "donning and doffing," (see our December 26 post on Lemmon v. City of San Leandro) is only one example of the creative arguments which are being raised - and sometimes accepted - in FLSA litigation. Keep your powder dry for this battle - even though that may not be a compensable activity....

Wednesday, January 2, 2008, 10:50 AM

Wage and Hour Division Announces Record Recovery

From United States Department of Labor: WASHINGTON — The U.S. Department of Labor's Wage and Hour Division (WHD) recently announced its enforcement data for Fiscal Year 2007, highlighting significant increases in recent years. For Fiscal Year 2007, the WHD paid $220,613,703 in back wages to 341,624 employees. Since Fiscal Year 2000, the WHD has received more than $1.25 billion from employers which it paid to approximately two million workers.

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