Wage and Hour Law

Home Media Magazine Reports: “Class-action Suit Filed Against Family Video”

March 17, 2011 | Peter S. Lubin and Patrick Austermuehle

Unpaid overtime lawsuits continue to proliferate as businesses seek to cut costs by cutting corners. Home Media Magazine reports that the largest privately owned video rental chain in the country, Family Video based in Gleview Illinois has been hit with an unpaid overtime class-action suit. Family Video employs more that 6,500 workers according to the artice. The article reports that the suit alleges:

[F]ormer employee Darvette Smith was not fairly compensated for standard and overtime hours worked at three Family Video store locations in Des Moines, Iowa, from November 2008 to January 2011.

The suit claims .. Family Video with 730 stores in 19 states violated provisions of the Fair Labor Standards Act in an effort to strictly manage its labor costs. Unpaid work included assisting customers, opening stores, maintenance, making required phone calls, completing inventory-related tasks, stocking shelves, and closing down stores, which required balancing cash registers and making off-site bank deposits.

You can read the full article by clicking here.

Federal District Court in Illinois Authorizes Class Notice in Warehouse Worker Overtime Litigation

March 6, 2011 | Peter S. Lubin and Patrick Austermuehle

The holiday season is a busy time for many corporations and particularly for those tied to the retail industry, increased holiday business usually means that employees have to work longer hours to keep up with consumer demands. Our Aurora overtime attorneys came across a case that illustrates what can happen when employers fail to compensate employees who work extra hours during such times of increased workflow.

In Nunes v. Chicago Import Inc. Plaintiffs worked for Defendant as warehouse laborers responsible for loading and unloading merchandise from delivery trucks and keeping the warehouse organized. In performing these duties, Plaintiffs routinely worked over forty hours per week, and worked seven days a week during the month of December. Plaintiffs were paid a flat rate of $300.00 per week for the first three weeks of the month, and were paid $400.00 for the fourth week. They were paid an additional $50.00 per week in December, but never received hourly or overtime wages for their services. Plaintiffs then filed suit alleging violations of the Fair Labor Standards Act (FLSA) and the Illinois Minimum Wage Law (IMWL), and asked the Court to issue an Order to Authorize Notice to Similarly Situated Persons under FLSA Section 216(b).

The Court granted Plaintiffs’ motion, holding that it was proper to leniently review the pleadings at this early stage of the litigation. As such, the five sworn declarations submitted by the Plaintiffs established that the representative and pending class members were sufficiently similarly situated to proceed with a class action. Defendants made objections that the proposed notice was too broad, and should not include administrative or executive staff. The Court agreed with Defendant and ordered adjustments to the form of the notice to exclude such employees, but otherwise found in favor of the Plaintiffs and granted their motion to authorize notice.

Northern District of Illinois Rules that State Law Overtime Claims Not Precluded by Prior Dismissal of FLSA Class-Action

February 28, 2011 | Peter S. Lubin and Patrick Austermuehle

When dealing with class-action wage and hour disputes, defendants will try to get the court to dismiss claims by any means that they can, and there are a variety of legal defenses that allow them to do so. At Lubin Austermuehle, our overtime lawyers are familiar with all of the tricks of the trade, so to speak, so they were interested to discover a case that illuminates just one of these many tools that is utilized by defendants to escape liability.

In Anyere v. Wells Fargo Co. Inc, Plaintiffs were current and former employees of Defendant and worked as credit managers who provided customers primarily with loan consolidation services. Plaintiffs filed a lawsuit alleging overtime violations under Fair Labor Standards Act (FLSA) because they were required to work during lunch, on weekends, and late into the night on a regular basis. Plaintiffs also alleged that Defendant “verbally disciplined employees for logging more than forty hours per week” and would adjust employees’ time records to stay under the overtime threshold. In response to these allegations, Defendant moved to dismiss the action on the basis of collateral estoppel due to a previous lawsuit filed against Defendant in California for the same overtime violations.

The Court dismissed the FLSA claims for nationwide relief based upon issue preclusion — the California-filed class-action was dismissed because the members of the proposed class were not similarly situated. However, the Court maintained the statewide action because the prior case did not contemplate an Illinois-only class-action and therefore could not have been litigated previously.

Northern District of Illinois Denies FRCP 12(b)(6) Motion to Dismiss Brought Against Dialysis Technicians

February 28, 2011 | Peter S. Lubin and Patrick Austermuehle

Because we focus on large-scale overtime class-action lawsuits, the attorneys here at Lubin Austermuehle have helped clients from many different fields recover their unpaid wages. We think it is important for all of our potential clients out there to understand what kinds of issues arise in wage and hour cases, so our Evanston overtime attorneys are always on the look-out for new decisions. In fact, our lawyers discovered a federal case in the Northern District of Illinois that involves workers in the medical industry.

In Howard v. Renal Life Link Inc., Plaintiffs worked for Defendant as dialysis technicians and routinely worked over forty hours each week, but Defendant allegedly deducted any overtime worked and paid Plaintiffs for only forty hours. The named Plaintiff complained to Defendant that she was not being paid properly for all of the time that she had worked, but Defendant allegedly ignored these complaints and continued to deduct any time worked over forty hours each week. Plaintiffs then filed suit alleging that these working hour deductions constituted violations of both the Illinois Minimum Wage Law (IMWL) and the Fair Labor Standards Act (FLSA). In response, Defendants filed a motion to dismiss the action under Federal Rule of Civil Procedure (FRCP) 12(b)(6) alleging that Plaintiff failed to supply sufficient factual evidence in the complaint in order to meet the requirements of FRCP 23.

Defendant’s based their argument that Plaintiff failed to allege enough facts because the complaint contained allegations based “upon information and belief” instead of hard evidence. The Court found this argument unpersuasive, however, because FRCP 8 allows such allegations as long as there is sufficient detail in the complaint to make the claims facially plausible. In denying Defendant’s motion to dismiss, the Court held that the issues brought up by Defendant were properly analyzed at the class certification phase of the case, and were not properly brought in a 12(b)(6) motion to dismiss.

Central District of Illinois Rules that Filing Opt-in Consent Forms is not Enough to Establish a Class-action Under FLSA

February 21, 2011 | Peter S. Lubin and Patrick Austermuehle

Across the nation, there are employees who go to work each day and earn overtime wages, but are unaware that they should be getting paid time and a half for the time they work over forty hours each week. Lubin Austermuehle focuses on wage and hour law, and our attorneys frequently meet clients who have years worth of unpaid overtime, and we help them get the wages they are owed. Our Chicago unpaid overtime class action attorneys discovered a case from the federal court for the Central District of Illinois that we wanted to share with our readers due to the unique nature of the issues tackled by the Court in its opinion.

Murray v. Tyson Foods is a case to determine whether Tyson should have paid overtime wages for the time that Plaintiffs spent putting on and taking off protective clothing worn in Tyson’s beef and pork processing plants. The case is one of many similar actions filed in five different states regarding this same issue. Plaintiffs filed a class-action suit alleging that Defendant’s failure to compensate Plaintiffs for that time constituted violations of the Illinois Wage Payment and Collection Act (IWPCA) and the Illinois Minimum Wage Law (IMWL), and filed individual claims for violations of the Fair Labor Standards Act (FLSA),
After the start of the litigation, Defendant filed a motion for partial summary judgment on the basis that the state law claims were preempted by the Labor Management Relations Act and the parties’ collective bargaining agreement. This motion was was granted, eliminating the class action issues and leaving only the FLSA claim for the six named Plaintiffs. The parties went on to discovery, and three days before the close of discovery, Plaintiffs noticed a 30(b)(6) deposition. Defendant opposed the deposition and filed for a protective order on the grounds that Plaintiffs sought the deposition to gather information on the previously dismissed class action claims. Plaintiffs responded by asserting that the filing of 1,474 opt-in consent forms from other putative class-members had created a collective action under FLSA.

The Court declined to agree with Plaintiffs’ argument because the complaint did not contain a representative FLSA claim and no motion was ever filed to certify a class-action on the claim. Thus, the opt-in consent forms had no legal meaning and did not create a class-action under FLSA. Additionally, the Court found that Plaintiffs’ 30(b)(6) notice was too broad, and granted Defendant’s protective order, but gave Plaintiffs time to issue a more tailored 30(b)(6) notice.

Southern District of Illinois Federal Court Conditionally Certifies FLSA Overtime Class-Action

February 21, 2011 | Peter S. Lubin and Patrick Austermuehle

Whether intentional or not, many companies implement policies and procedures that create violations of both federal and state wage laws. In our years of practicing law, Lubin Austermuehle has seen many such policies, and our Crystal Lake overtime attorneys have helped many previous clients victimized by them. Our lawyers recently discovered a wage and hour class-action case regarding one such policy and wanted to share it with our readers.

In Marshall v. Amsted Industries, Inc., the two named Plaintiffs worked at Defendants’ steel foundry as an hourly leadman and hourly chipper, respectively. Plaintiffs filed a class-action suit for unpaid overtime and a failure to keep accurate payroll records pursuant to the Fair Labor Standards Act (FLSA). They sought conditional certification of a class comprised of all current and former hourly employees who worked at Defendants’ facility in the last three years. Plaintiffs alleged that Defendants implemented a company policy that all hourly workers had to perform maintenance and service tasks as well as don protective clothing prior to the beginning of their work shifts. Additionally, Plaintiffs had to carry out shut-down and clean-up procedures after the end of their shifts, but were never compensated for the work performed during these times. In response to Plaintiff’s motion for conditional certification, Defendants’ moved to de-certify the action.

The Court found that they met the requirements of certification under FLSA and conditionally certified a class, despite the presence of four different collective bargaining agreements and varied job titles of the potential plaintiffs. The Court based their conditional approval on the fact that all of the hourly workers were similarly situated enough to allow Plaintiffs to send out opt-in notices. In so holding, the Court decided that Defendans’ company policies of requiring workers to complete pre- and post-shift tasks applied equally to all of the hourly workers and deprived them of their overtime pay.

Illinois District Court Holds that Termination is Not a Wage Reduction under FMLA

February 9, 2011 | Peter S. Lubin and Patrick Austermuehle

We here at Lubin Austermuehle have extensive experience as Joliet overtime class-action lawyers and are constantly scouring the federal court dockets in Illinois for cases that may help our practice. One particularly instructive opinion was issued by the Northern District of Illinois, Eastern Division earlier this year in Ottaviano v. Home Depot Inc.

In Ottaviano v. Home Depot Inc., the Plaintiff employees worked for Home Depot as assistant store managers, and allege that they and their fellow class members were misclassified as exempt employees. Plaintiff’s claimed that Defendant’s misclassification was intentional for the purpose of circumventing the Illinois Minimum Wage Law (IMWL). Defendant Home Depot denied the claims and filed to dismiss the action through a motion for summary judgment.

The named Plaintiffs had worked for Defendant between approximately two to six years, and had worked well in excess of forty hours per week during the entirety of their employment. During the time that the Plaintiffs worked for Home Depot, they were paid a salary and were required to work fifty-five hours a week. Home Depot requires that all assistant store managers (ASM), including Plaintiffs, go through a training stage for two to eight weeks before they are deemed to be a qualified and capable ASM able to fulfill the responsibilities required for the position. The trainee ASM’s are classified as exempt by Defendants and are paid a salary during this period. Defendant has a universal policy of scheduling its ASM’s for fifty-five hours per week, and Home Depot terminates assistant store managers who fail to work the hours they are scheduled.

Plaintiffs filed their class action alleging that they were owed overtime for the training period and for every other week of their employment with Home Depot. Plaintiffs contended that Defendant’s policy of terminating ASM’s who do not work fifty-five hours a week is effectively a wage reduction under the Federal Labor Standards Act (FMLA). Plaintiffs also argued that under the salary-basis test, any employee whose wages can be reduced by their employer is non-exempt. The Court did not find Plaintiffs’ arguments persuasive, and in dismissing the claims Judge Dow cited a U.S. Supreme Court ruling that true exempt employees are disciplined by terminations, demotions, or restricted work assignments, as the Plaintiffs were, instead of wage deductions. The District Court went on to say that employers are permitted to set requirements for the overall number of hours worked by their exempt employees. Finally, the Court granted summary judgment to dismiss the overtime claims for the training period because they were barred by the applicable statute of limitations.

NPR Reports: “New York Tackles Wage Theft”

February 6, 2011 | Peter S. Lubin and Patrick Austermuehle

Lubin Austermuehle is a firm of dedicated attorneys who focus on nationwide class action lawsuits. Our firm has successfully prosecuted wage and hour class actions for years and we pride ourselves on getting results. Our Chicagoland area lawyers know the overtime laws and have dealt with the issues that arise from wage claims. Many employers misclassify employees as being exempt from overtime laws and pay salary wages instead of hourly wages to avoid paying overtime. Some employers mistakenly classify employees as exempt and others intentionally do so in order to circumvent the law. In either case, workers do not receive the wages they should, and filing a lawsuit can help to recover their wages. Lubin Austermuehle serves many clients in Chicago, Lincolnshire, and Libertyville, but also represents clients across the nation who have not been paid for the overtime hours that they worked. If you believe that you are owed overtime wages, contact one of our Chicago wage and hour attorneys by phone at 1 630-333-0333, or through our online form.

The New York Law Journal Reports: “Court Certifies Class of Exotic Dancers in Action Over Unpaid Wages”

January 1, 2011 | Peter S. Lubin and Patrick Austermuehle

The New York Law Journal reports that the national strip club chain Rick’s Caberet International, Inc. faces a wage and hour class-action lawsuit by its dancers for allegedly failing to pay wages and requiring the dancers to earn all monies through tips. The New York federal court where the case is pending certified the case as a class-action. You can read the article by clicking here.

Lubin Austermuehle is a firm of dedicated attorneys who focus on nationwide class action lawsuits. Our firm has successfully prosecuted wage and hour class actions for years and we pride ourselves on getting results. Our Chicagoland area lawyers know the overtime laws and have dealt with the issues that arise from wage claims. Many employers misclassify employees as being exempt from overtime laws and pay salary wages instead of hourly wages to avoid paying overtime. Some employers mistakenly classify employees as exempt and others intentionally do so in order to circumvent the law. In either case, workers do not receive the wages they should, and filing a lawsuit can help to recover their wages. Lubin Austermuehle serves many clients in Naperville and Wheaton, but also represents clients across the nation who have not been paid for the overtime hours that they worked. If you believe that you are owed overtime wages, contact one of our Chicago wage and hour attorneys by phone at 1 630-333-0333, or through our online form.

Class Certification Under Federal Rule of Civil Procedure Rule 23(a)

December 29, 2010 | Peter S. Lubin and Patrick Austermuehle

We here at Lubin Austermuehle often represent our clients in federal court, and our practice includes handling wage and hour disputes so we keep an eye on such cases filed in Illinois. In re AON Corp. is the consolidation of a New York case with an action filed in Illinois District Court to certify a wage and hour class action pursuant to Federal Rule of Civil Procedure 23(a). Plaintiffs allege violations of the Illinois Minimum Wage Law (IMWL) and Fair Labor Standards Act (FLSA) for unpaid overtime. In its opinion, the Court discussed whether the purported class met the four standards required for certification as set forth in FRCP 23(a). The Court analyzed the numerosity of class members, commonality of the issues between class members, typicality of the class representatives, and adequacy of representation proffered by the named Plaintiffs and their attorneys.

The Plaintiffs in this case are former employees of Defendant AON who worked as Associate Specialists, Client Specialists, and Senior Client Specialists in the Client Services Units and Policy Maintenance Units located at AON’s facilities in Illinois and New York. Plaintiffs argue that AON improperly classified the purported class members as administrative employees, thereby violating the IMWL and the FLSA and entitling them to overtime compensation.

The Court found that the Illinois Plaintiffs satisfied the Rule 23(a) numerosity requirement because there were 515 members of the proposed class and joinder of that many actions would be impracticable. The commonality requirement was met because there is a common question of law as to whether the class members were properly classified as administrative workers. The Rule 23(a) typicality requirement was met because all of the claims arise out of the same act of classification and assert the same violation of the law. The adequacy requirement of Rule 23(a) was met because the named Illinois Plaintiffs suffered the same injury as the class and have pursued the case for over 2 years. Additionally, Plaintiffs’ counsel has the requisite resources and experience in both class action and wage & hour litigation to adequately protect the interests of the class. Finally, the Court found that the requirements of Rule 23(b)(3) were met despite the fact that the class members have different clients and peripheral duties. The Court concluded that the class members’ essential job functions were similar enough that the central legal issue regarding classification of each class member as an administrative employee under the IMWL predominated and that a class action was a superior method of resolving the case.

To conditionally certify a class under 216(b), Plaintiffs must make a modest factual showing to demonstrate that they and potential plaintiffs together were victims of a common policy or plan that violated the law. Secondly, after all or a significant portion of discovery is completed, the Court must perform a stricter examination of whether the class members are similarly situated. The Plaintiffs sought to apply the first stage of 216(b) analysis, while the Defendant asked the Court to perform the second stage inquiry. The Court held that the second stage analysis was improper due to a relative lack of discovery in the case thus far. A second stage 216(b) analysis would prejudice the New York Plaintiffs by failing to give them adequate opportunity to present a more complete evidentiary picture. Additionally, performing the second phase analysis was premature because potential plaintiffs had not yet received notice and the opportunity to opt into the suit.

The Court conditionally certified the class because there was uniformity between the class representative and the class members due to: the similar type of work they performed, the uniform Defendant-produced processes used to perform their jobs, and the common legal issue of misclassification.

In Re AON Corp. provides guidance for future wage and hour litigants by explaining the requirements for class certification under the Federal Rules of Civil Procedure. This case also provides clarification regarding class certification under the Federal Labor Standards Act. Plaintiffs who seek to certify a class must have some evidence for conditional certification, but also should be mindful that they must acquire more substantial evidence through discovery to fully certify the class under the FLSA.