JANE MAGNUS-STINSON, Chief District Judge.
Plaintiffs Fannie Kolish and Kevin Graves were employees of Metal Technologies, Inc., ("
This case is related to Weil v. Metal Technologies, Inc., 2016 WL 286396 (S.D. Ind. 2016). The plaintiffs in Weil sought to certify several Rule 23 class action and FLSA collective action sub-classes. Id. In particular, the plaintiffs attempted to certify a Rule 23 sub-class and a collective action sub-class to address Metal Technologies' failure to pay its employees for lunch breaks of twenty minutes of less. Id. at *8, *15. This Court found that the plaintiffs were not adequate class representatives and on January 25, 2016, the Court denied certification of the two sub-classes. Id. at *16. The Court did, however, conditionally certify the following sub-classes: a Rule 23 class and a collective action class regarding an allegedly unlawful rounding policy related to clock-in and clock-out times at the beginning and end of the work day that uniformly shorted employees, and a Rule 23 class action regarding the allegedly unlawful wage deductions for uniforms. Id. at *16-17. Because Weil is related to this case, the Court has issued an entry to allow the parties to use discovery materials from Weil in this case. [
Metal Technologies is a manufacturing facility located in Bloomfield, Indiana, that manufactures automobile parts for car manufacturers, including General Motors, Ford, Chrysler, Hyundai, and Honda. [
Ms. Conrad testified that every new employee was given a copy of Metal Technologies' Employee Handbook, [
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With respect to business hours and work schedules, the Employee Handbook states the following:
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If any employee wished to work more than eight hours per day, the employee was required to complete an Overtime Authorization form in order to be paid for his or her time. [
From January 20, 2013 to March 20, 2016, Metal Technologies maintained a system that recorded the times its employees clocked out for lunch and clocked back in to return to work. [
In addition, Ms. Conrad testified that she would review the time records regarding the times that employees would clock out for lunch and clock back in to return to work, and admitted that there were times she noticed that an employee's lunch break was twenty minutes or less. [
According to Ms. Conrad, sometime in March 2016, Metal Technologies stopped collecting data that recorded the start and end time of the employees' lunch breaks, and the employees also stopped recording their lunch breaks. [
Plaintiffs' counsel filed an Affidavit with a summary of time and payroll records of 275 participating plaintiffs in Weil. [
Ms. Kolish was an employee at Metal Technologies who worked as a parts inspector on a line along with a team of four or five other employees. [
Ms. Kolish had twenty-four different unpaid lunch breaks that lasted between one and twenty minutes. [
On September 13, 2016, the Magistrate Judge presiding over this case held a settlement conference, [
Mr. Graves was hired by Metal Technologies in 2011, [
Metal Technologies obtained twenty-two declarations from employees who testified that they took a thirty-minute lunch break every day. [See
At the outset, the Court notes the Seventh Circuit Court of Appeals' instruction that "employees who institute a collective action against their employer under the terms of the [FLSA] may at the same time litigate supplemental state-law claims as a class action certified according to Federal Rule of Civil Procedure 23(b)(3)." Ervin v. OS Rest. Servs., 632 F.3d 971, 973-74 (7th Cir. 2011); see also Robertson v. Steamgard, 2012 WL 1232090, *2 (N.D. Ill. 2012) ("the Seventh Circuit has held that the FLSA is `amenable to state-law claims for related relief in the same federal proceeding'"). This Court will heed that instruction, and finds it proper that Plaintiffs have brought, and seek certification of, both their FLSA claims and their IWPA claims in the same litigation.
In deciding whether to certify a class, the Court may not blithely accept as true even the well-pleaded allegations of the complaint but must instead "make whatever factual and legal inquiries are necessary under Rule 23" to resolve contested issues. Szabo v. Bridgeport Machs., Inc., 249 F.3d 672, 676 (7th Cir. 2001). Specifically, the Court must find that the putative class satisfies the four prerequisites set forth in Federal Rule of Civil Procedure 23(a). If the putative class does satisfy these prerequisites, the Court must additionally find that it satisfies the requirements set forth in Federal Rule of Civil Procedure 23(b), which vary depending upon which of three different types of classes is proposed. In this case, the Plaintiffs seek certification under Federal Rule of Civil Procedure 23(b)(3).
It is the plaintiffs' burden to prove first that an identifiable class exists that merits certification under Federal Rule of Civil Procedure 23(a). Oshana v. Coca-Cola Co., 472 F.3d 506, 513 (7th Cir. 2006). The four prerequisites under Rule 23(a) are: "(1) [that] the class is so numerous that joinder of all its members is impracticable; (2) [that] there are questions of law or fact common to the class; (3) [that] the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) [that] the representative parties will fairly and adequately protect the interests of the class." Fed. R. Civ. P. 23(a). Class certification is not appropriate unless the named plaintiffs establish all four prerequisites. Gen. Tel. Co. of the Southwest v. Falcon, 457 U.S. 147, 156 (1982).
Plaintiffs seek to certify the following class under the IWPA:
[
Plaintiffs clarify that the class will not consist of all Metal Technologies employees who worked during the relevant period of time, but merely those who followed the written policy and clocked out and back in for lunch, and whose records reflect that their lunch breaks lasted between one and twenty minutes. [
Plaintiffs argue that their IWPA claims were originally raised in Weil when it was filed on January 20, 2015, and should be equitably tolled up until the time when the Court denied certification on January 25, 2016. [
In response, Metal Technologies challenges Plaintiffs' class definition that the class would consist of employees who worked from January 20, 2013 to the present. [
The filing of a class action suit tolls the statute of limitations for all the members of the class, but when the suit is dismissed without prejudice or when class certification is denied, the statute resumes running for the class members. Culver v. City of Milwaukee, 277 F.3d 908, 914 (7th Cir. 2002) (internal citations omitted).
The statute of limitations for Plaintiffs' IWPA claims was equitably tolled on January 20, 2015 at the time Weil was filed. Weil denied certification of the two sub-classes pertaining to the short lunch breaks on January 26, 2016, and the statute of limitations began to run again up until April 27, 2016 when Plaintiffs filed this cause of action. Because the claims stopped tolling during those three months, the appropriate class definition should include employees who worked at Metal Technologies since April 20, 2013, not January 20, 2013.
Plaintiffs claim that the time and payroll records establish that Metal Technologies failed to pay its employees their lunch breaks of twenty minutes or less. Plaintiffs plan to use the same strategy that was used in Weil by relying on the employees' time and payroll records to demonstrate that Metal Technologies maintains a class-wide policy or practice that violates the IWPA. That strategy seems appealing at first blush. But scrutiny of the evidence presented with regard to the instant motions reveals that it cannot be reliably employed here. Significant evidence exists that undermines the reliability of the time clock records for lunch breaks. Thus, before discussing the Rule 23 analysis, the Court will make factual findings of the evidence. See Szabo, 249 F.3d at 676.
In Weil, this Court certified two sub-classes regarding time rounding policies of when employees clocked in and out for work. Weil, 2016 WL 286396, *5, *11. Weil found that the defendant, Metal Technologies, admittedly rounded the employees' times to the employer's benefit and that unlike here, there was no credible dispute presented at the certification stage that the records accurately reflected when employees clocked in to begin their shift and when they clocked out at the end of their shift.
However, the evidence before the Court establishes that those records do not paint an accurate picture. For example, while Ms. Kolish's time clock records show that at times she clocked out for a period of twenty minutes or less, they also establish that she clocked out and back in for lunch in the same minute on 88 different occasions. When asked why she clocked in and out in the same minute, Ms. Kolish responded, "it was not necessarily an intentional thing. I mean, I have no idea," and when asked why she did so on 88 different occasions, she stated "I don't remember. I've had a few jobs since then, and I have slept some since then." [
In addition, Metal Technologies filed declarations from twenty-two employees that state that despite what the records show, they always took thirty-minute lunch breaks. Plaintiffs claim that the declarations do not have probative value, are unreliable, and to the extent that they contain any contradictions, cannot create an issue of material fact by merely manufacturing a conflict in the testimony. The Court finds the affidavits are admissible, probative, and do in fact undermine the reliability of the duration of the employees' lunch break time clock punches. Further they are consistent with the questions raised by Ms. Kolish's own testimony and records which undermine the reliability of the time records.
Plaintiffs attempt to shore up their reliance on the records by citing to the Employee Handbook policy that states that the only way Metal Technologies knows how many hours the employee worked and how much to pay him or her is by using the employee's time punch. However, Metal Technologies points to other policies in the Employee Handbook that provide that employees were required to take a thirty-minute, unpaid lunch break and that they could not work through their lunch unless it was approved. Ms. Conrad testified that employees who worked through their lunch were required to complete an Overtime Authorization form in order to be paid for that time. In addition, one of the employees stated in her declaration that if she worked during her lunch, she completed the form to be compensated for the time that she worked. [
Lastly, Plaintiffs were aware of Metal Technologies' thirty-minute, unpaid lunch break policy and they proffered no testimony that they completed Overtime Authorization forms when they worked through their lunch. Mr. Graves testified that he would take lunch breaks of twenty minutes or less, and that he would sweep or find something else to do because the machines were down during lunch. While Ms. Kolish testified that she felt pressured to return to work early, neither Ms. Kolish nor Mr. Graves testified that they were instructed to return to work early. They also testified that at the time, they did not know that they were supposed to be paid for the part of their lunch that they worked. Mr. Cunningham, who supervised Plaintiffs, testified that he never saw Plaintiffs work during their lunch breaks, and that had he known, he would have instructed them to fill out Overtime Authorization forms.
Ultimately, Plaintiffs have failed to present substantial credible evidence that the time clock records can be relied upon as an accurate measure of the actual time any employee spent on a lunch break. Whether considered a failure to meet their burden of proof or a specific finding by the Court that the time clock records are not accurate with respect to the lunch breaks — and the Court finds both — this inadequacy
Plaintiffs claim that they meet the prerequisites of Rule 23(a) and Rule 23(b)(3). Metal Technologies challenges several aspects of Plaintiffs' position.
Plaintiffs claim that numerosity is met because Metal Technologies "admits that 500 to 550 hourly paid employees have worked for Metal Technologies since January 20, 2012 . . . and all hourly paid employees were subjected to the same lunch break time tracking system, the same rule that any lunch break will be treated as an unpaid thirty (30) minute increment of time . . ., and . . . a rule where any recorded lunch break of twenty (20) minutes or less was still treated as unpaid time." [
Metal Technologies challenges this argument and claims that numerosity is not met. [
In reply, Plaintiffs argue that numerosity is met because Metal Technologies uniformly and consistently applied recorded lunch breaks of twenty minutes or less as unpaid, thirty-minute breaks to the 500 to 550 employees. [
Rule 23(a)(1) provides that a class action may be maintained only if "the class is so numerous that joinder of all members is impracticable." Fed. R. Civ. P. 23(a)(1). A plaintiff does not need to plead or prove the exact number of class members to establish numerosity, Marcial v. Coronet Ins. Co., 880 F.2d 954, 957 (7th Cir. 1989), and the court may make common sense assumptions to determine numerosity, see Arreola v. Godinez, 546 F.3d 788, 797 (7th Cir. 2008). The Seventh Circuit has held that "[e]ven if the class were limited to 40 [members] . . . that is a sufficiently large group to satisfy Rule 23(a) where the individual members of the class are widely scattered and their holdings are generally too small to warrant undertaking individual actions." Swanson v. Am. Consumer Indus., Inc., 415 F.2d 1326, 1333 n. 9 (7th Cir. 1969).
Setting aside concerns about the reliability of the time clock records, Plaintiffs have demonstrated that at least 228 Rule 23 class members and 47 FLSA opt-in plaintiffs in the related Weil case have time and payroll records that show that they took lunch breaks of twenty minutes or less. Thus, they have met the numerosity requirement given that joinder would be impracticable.
Plaintiffs claim that they have presented the common question that seeks the common answer of whether "Metal Technologies [is] liable under the FLSA and [IWPA] for each and every failure to pay wages for an unpaid break of less than twenty (20) minutes as shown on each class member's time records[.]" [
In response, Metal Technologies claims that merely posing a common issue is not enough to certify a class.
In reply, Plaintiffs reiterate that they present a common question that seeks a common answer: "is Metal Technologies liable under the [IWPA] for each and every failure to pay wages for an unpaid break of less than twenty (20) minutes as shown on each class member's time records?" [
A class action requires "questions of law or fact common to the class," Fed. R. Civ. P. 23(a)(2), and the plaintiff's claims or defenses must be "typical of the claims or defenses of the class[,]" Fed. R. Civ. P. 23(a)(3). Commonality is satisfied when there is a "common nucleus of operative fact," that is, a "common question which is at the heart of the case." Rosario v. Livaditis, 963 F.2d 1013, 1018, (7th Cir. 1992) (citation omitted). All questions of fact or law need not be identical; rather, the requirement is satisfied as long as the class claims arise out of the same legal or remedial theory. In re Ready-Mixed Concrete Antitrust Litig., 261 F.R.D. 154, 167 (S.D. Ind. 2009). The commonality and typicality requirements tend to merge because both "serve as guideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff's claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence." Gen. Tel. Co. of the Southwest, 457 U.S. at 158 n. 13. Although typicality may exist even if there are factual distinctions between the claims of the named plaintiffs and other class members, the requirement "directs the district court to focus on whether the named representatives' claims have the same essential characteristics as the claims of the class at large." Muro v. Target Corp., 580 F.3d 485, 492 (7th Cir.2009) (citation omitted).
According to Plaintiffs, the class action's claims arise under the IWPA, which they claim is derivative of the FLSA claims. [
[
Plaintiffs argue that the IWPA governs the frequency and amount the employer must pay its employee, and that the class has the right to be paid all earned wages in full and on time. [
To establish commonality, Plaintiffs claim that they present a common question that will generate a common answer. However, while they present a common question, here they fail to demonstrate that Metal Technologies' time clock records will generate common answers. In Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 349-50 (2011), the Supreme Court reversed a decision to certify a class action in part because the plaintiffs failed to prove that the class had common questions of law or fact that were common to the class. The plaintiffs argued that the employer engaged in discrimination against women in violation of Title VII when local managers exercised their discretion over pay and promotions in a way that disproportionately favored men. Id. at 344-45. The Supreme Court held that it was not sufficient to show that all the members suffered a violation of Title VII, but that their claims needed to generate common answers to show there was "some glue holding the alleged reasons for all those [employment] decisions together." Id. at 352 (original emphasis). Moreover, the Seventh Circuit Court of Appeals in a recent opinion stated the following:
McCaster, ___ F.3d at ____, 2017 WL 56298, *5 (7th Cir. 2017) (internal citations and quotation marks omitted).
Moreover, this Court in a recent decision denied class certification to plaintiffs seeking to certify an IWPA class action on similar grounds. Walker v. Health & Hosp. Corp. of Marion Cty., 2016 WL 7179370, *1 (S.D. Ind. 2016). The plaintiffs in Walker were respiratory therapists who claimed that they and other similarly situated employees either worked through their meal breaks or had interrupted meal breaks and that instead of being compensated, the employer automatically deducted thirty minutes from their pay. Id. at *6. In discussing commonality, this Court found that the plaintiffs failed to provide sufficient evidence that other employees were not compensated for their missed or interrupted meal breaks, and in particular, pointed to emails from several employees who had notified the supervisor that they had missed or interrupted meal breaks, and the supervisor had adjusted their time accordingly. Id.
Like Walker, Plaintiffs fail to proffer sufficient evidence to demonstrate that Metal Technologies maintained a policy or practice of not paying its employees lunch breaks of twenty minutes or less. As explained in the factual findings above, the time and payroll records are not reliable and do not accurately reflect the duration of all the employees' lunches. While Plaintiffs claim that they were not paid for their lunch breaks of twenty minutes or less, twenty-two employees submitted declarations that indicate that they always took a thirty-minute, unpaid lunch break, that their records do not reflect the duration of their lunch breaks, and that at least one of them completed an Overtime Authorization form when she worked through her lunch.
The Court is not making any determination as to whether Metal Technologies has violated the IWPA with respect to Ms. Kolish or Mr. Graves. Rather the Court simply finds that with regard to commonality, there is no "glue" here. By merely relying on the time and payroll records, Plaintiffs are unable to demonstrate that all the employees were subject to the same conduct — not getting paid for lunch breaks of twenty minutes or less — at the hands of Metal Technologies. Indeed the Court cannot even determine that the employees actually took a lunch break of 20 minutes or less. In order to determine whether Metal Technologies violated the IWPA, the Court would need to look beyond the employees' time and payroll records and inquire specifically into whether each class member's lunch breaks actually corresponded to the time clock entries. Thus, the common question that Plaintiffs present would almost certainly generate different responses.
In addition, with respect to typicality, Plaintiffs have also not demonstrated that their claims are typical to those of the class because, again, the records fail to demonstrate that other employees suffered the same or any injury. Therefore, the Court finds that Plaintiffs fail to meet the commonality and typicality requirements.
Plaintiffs claim that Ms. Kolish and Mr. Graves are adequate class representatives because they each have the same claim for unpaid wages as the entire class, they are motivated to recover their wages and the damages of the class, and they have actively participated in the litigation. [
In response, Metal Technologies claims that Ms. Kolish is not an adequate representative of the class because she has provided false information to the Court when she claimed that she was unable to attend a settlement conference. [
In reply, Plaintiffs indicate that Ms. Kolish is willing to allow Mr. Graves to serve as the Rule 23 class representative. [
The Court is required to find whether "the representative parties will fairly and adequately protect the interests of the class." Fed. R. Civ. P. 23(a)(4). The adequacy inquiry is comprised of two parts: "the adequacy of the named plaintiff's counsel, and the adequacy of representation provided in protecting the different, separate, and distinct interest[s] of the class members." Retired Chicago Police Ass'n v. City of Chicago, 7 F.3d 584, 598 (7th Cir. 1993) (citation and quotation marks omitted). To adequately represent the class, the representative plaintiffs "must be part of the class and possess the same interest and suffer the same injury as the class members." Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 625 (1997) (citation and quotation marks omitted).
With regard to Ms. Kolish, the Court finds that her inconsistent statements to the Court render her an inadequate class representative. The fact that she lied to her attorney regarding her inability to attend a settlement conference because she claimed to be out of town for a funeral when in reality she was in town is troubling and raises credibility problems that would prevent her from serving as an adequate class representative. "[P]ersonal characteristics, such as the credibility and integrity of a putative class representative, have a direct bearing on their ability to adequately represent absent members of the class." Davidson v. Citizens Gas & Coke Util., 238 F.R.D. 225, 229 (S.D. Ind. 2006); London v. Wal-Mart Stores, Inc., 340 F.3d 1246, 1254 (11th Cir. 2003); Kline v. Wolf, 702 F.2d 400, 403 (2nd Cir. 1983) (upholding district court's finding that potential class representative's admitted false statements left their credibility open to serious attack).
This leaves Mr. Graves. Notwithstanding the other Rule 23 requirements, Mr. Graves would adequately represent the interest of the class. He claims he was not paid when he took his lunch breaks of twenty minutes or less, his records reflect lunch breaks of twenty minutes or less, and he was an employee during the relevant time period. The Court, likewise, finds that Plaintiffs' counsel has a sufficient interest in the outcome of the case, and is competent and motivated to litigate this case given his experience with previous class actions. Thus, Mr. Graves satisfies the adequacy requirement.
Although Plaintiffs do not meet some the Rule 23(a) requirements, the Court will go on to consider the Rule 23(b)(3) requirements.
Plaintiffs claim that they meet the predominance and superiority requirements under Rule 23(b)(3). They argue that "the most significant factual issue is whether Metal Technologies ignores its time records and treats its employees' recorded lunch breaks of twenty minutes or less as unpaid time," and that "the most significant legal issue is whether or not Metal Technologies was permitted by Indiana law and/or the FLSA to ignore its time records and treat recorded lunch breaks of twenty minutes or less as unpaid time." [
In response, Metal Technologies argues that individual issues will predominate because liability under the IWPA will depend "on each employee establishing that they were not paid the `amount due' to them based on a mutual decision between them and Metal Technologies." [
In reply, Plaintiffs claim that there is nothing individualized about the class claims. [
Under Rule 23(b)(3), a class action may be maintained if Rule 23(a) is satisfied and if the court finds that the questions of law or fact common to class members predominate over any questions affecting individual members, and that a class action is superior to other available methods of adjudicating the controversy. The matters pertinent to these findings include:
Fed. R. Civ. P. 23(b)(3).
"`Considerable overlap exists between Rule 23(a)(2)'s commonality prerequisite and 23(b)(3)." Hawkins v. Alorica, Inc., 287 F.R.D. 431, 448 (S.D. Ind. 2012) (citations omitted). Rule 23(b)(3) permits class certification if the questions of law or fact common to class members "predominate" over questions that are individual to members of the class. Messner v. Northshore Univ. HealthSystem, 669 F.3d 802, 814 (7th Cir. 2012). "The Supreme Court has discussed predominance in broad terms, explaining that the Rule 23(b)(3) `inquiry trains on the legal or factual questions that qualify each class member's case as a genuine controversy,' with the purpose being to determine whether a proposed class is `sufficiently cohesive to warrant adjudication by representation.'" Messner, 669 F.3d at 814 (quoting Amchem Products, Inc. v. Windsor, 521 U.S. 591, 623 (1997)). Although it is similar to Rule 23(a)'s commonality requirement, "the predominance criterion is far more demanding." McCaster, ___ F.3d ___, 2017 WL 56298, at *5; Messner, 669 F.3d at 814 (quoting Amchem Products, 521 U.S. at 623-24).
Because Plaintiffs fail to meet the commonality requirement, they also fail to meet the predominance requirement. See Camilotes v. Resurrection Health Care Corp., 286 F.R.D. 339, 355 (N.D. Ill. 2012) (denying class certification where plaintiffs had not met burden of showing they were similarly situated to other class members, and stating "Rule 23(b)(3)'s predominance requirement is more stringent than the `similarly situated' requirement under [the FLSA]," and "Plaintiffs will not be able to prove their claims using evidence that is common to the class"). Here, individual issues would predominate over the issues common to the class. As noted above, since the time and payroll records are an unreliable barometer of whether wages were unpaid, the Court would need to look beyond the records to determine whether each employee did in fact take a lunch break of twenty minutes or less, whether Metal Technologies knew if each employee was working through his or her lunch, and whether based on the employee's circumstances a violation of the IWPA occurred.
Plaintiffs also fail to meet the superiority requirement. Adjudicating the claims in a class action would not be superior because Plaintiffs rely on the time and payroll records that do not reliably demonstrate that Metal Technologies maintained a policy that violated the IWPA on a class-wide basis. To determine whether there was a violation, the Court would need to partake in "mini-trials" and examine the circumstances of each class member's claim.
Accordingly, the Court denies Plaintiffs' Motion to certify the IWPA claims.
The FLSA provides that an action for unpaid minimum wages or unpaid overtime compensation may be brought "by any one or more employees for and in behalf of himself or themselves and other employees similarly situated." 29 U.S.C. § 216(b). A collective action differs significantly from a class action brought pursuant to Federal Rule of Civil Procedure 23. Moss v. Putnam County Hosp., 2010 WL 2985301 (S.D. Ind. 2010). The primary difference is that plaintiffs who wish to be included in a collective action must affirmatively opt in by filing a written consent with the Court, while members of a Rule 23 action are automatically included unless they affirmatively opt out. Alvarez v. City of Chicago, 605 F.3d 445, 448 (7th Cir. 2010). Rule 23 and its standards governing class certification do not apply to a collective action brought under the FLSA. Moss, 2010 WL 2985301 at *1.
An employee may only bring a collective action on behalf of other employees who are similarly situated. 29 U.S.C. § 216(b). Therefore, to decide whether to initially certify a collective action, the Court must determine whether members of the proposed class are, in fact, similarly situated. Campbell v. Advantage Sales & Mktg., LLC, 2010 WL 3326752, *4 (S.D. Ind. 2010). Courts within this Circuit typically use a two-step inquiry. Scott v. NOW Courier, Inc., 2012 WL 1072751, *7 (S.D. Ind. 2012); Lallathin v. Ro Ro, Inc., 2010 WL 2640271 (S.D. Ind. 2010).
The first step, also known as the notice stage, involves analysis of the pleadings and affidavits that have been submitted to determine whether notice should be given to potential class members. Campbell, 2010 WL 3326752, at *3. Although the first step of certification does not impose a high burden on the plaintiff, "this does not mean that the `modest factual showing' is a mere formality." Id. at *4. It serves as an important and functional step in the certification process because "it would be a waste of the Court's and the litigants' time and resources to notify a large and diverse class only to later determine that the matter should not proceed as a collective action because the class members are not similarly situated." Adair v. Wis. Bell, Inc., 2008 WL 4224360, *4 (E.D. Wis. 2008) (citation omitted).
The second step of certification occurs after discovery has largely been completed and allows a defendant the opportunity to seek decertification of the class or restrict the class because various putative class members are not, in fact, similarly situated as required by the FLSA. Id. at *3. Under this more stringent inquiry, courts typically consider the following factors: "(1) whether plaintiffs share similar or disparate factual and employment settings; (2) whether the various affirmative defenses available to the defendant would have to be individually applied to each plaintiff; and (3) fairness and procedural concerns." Threatt v. CRF First Choice, Inc., 2006 WL 2054372, *5 (N.D. Ind. 2006).
The FLSA does not define the term "similarly situated" or instruct judges when to exercise their discretion and authorize notice to potential plaintiffs. Raymer v. Mollenhauer, 2010 WL 3259346 (N.D. Ind. 2010). Courts have held, however, that being similarly situated does not require identical positions of the putative class members; instead, it requires that common questions predominate among the members of the class. Campbell, 2010 WL 3326752, at 4; Alvarez, 605 F.3d at 449. Accordingly, the Court will consider whether Plaintiffs have presented evidence which supports a finding that they are similarly situated to putative class members.
Plaintiffs seek to certify the following FLSA collective action:
[
Plaintiffs claim that all members of the collective class are similarly situated to the class representatives. [
Plaintiffs claim that they have demonstrated that Plaintiffs are similarly situated to their hourly-paid Metal Technologies coworkers and that they are relying on Metal Technologies' own payroll and time records, and admitted wage policies. [
In response, and similar to its challenges to the time clock records for the Rule 23 class, Metal Technologies argues that automatic lunch deductions are not a per se violation of the FLSA and that Plaintiffs' evidence does not demonstrate when they and other similarly situated employees were engaged in compensable time. [
In reply, Plaintiffs reiterate that their claims are limited to Metal Technologies' own records of employee lunch breaks of twenty minutes or less, which were required to be paid. [
As noted above, Plaintiffs claim that Metal Technologies violated the following FLSA provision:
[
By solely relying on the time and payroll records, which the Court has already found to be an unreliable measure of the duration putative class members may have taken for lunch, Plaintiffs have not made the necessary modest factual showing that similarly situated members of the class were all subjected to the same policy or practice of not being paid lunch breaks of twenty minutes or less. First, even though Ms. Conrad testified to rounding lunch breaks of twenty minutes or less to thirty minutes of unpaid lunch time, rounding practices and automatic meal deductions are not per se violations of the FLSA. See, e.g., Weil, 2016 WL 286396, at *6 ("[R]ounding practices or policies to determine the employees' hours of pay are not prohibited by the FLSA") (citing 29 C.F.R. § 785.48(b)); see also Cason, 2011 WL 1659381, at *3. Second, while the parties agree that Metal Technologies had a time clock that employees used to clock out and back in for lunch, the accuracy of the lunch time clock records has been undermined. As noted, Ms. Kolish's records show that she clocked out and back in during the same minute 88 times, and when asked why she did so, she could not provide an explanation. Several employees provided declarations that indicated that they always took thirty-minute lunch breaks despite what the records showed.
Additionally, Metal Technologies required employees to take thirty-minute, unpaid lunch breaks, Plaintiffs testified that they knew they were required to take thirty-minute lunch breaks, and when employees worked during their lunch breaks, Metal Technologies required them to complete an Overtime Authorization form to be paid for the time that they worked. An employer is not required to "pay for work it did not know about, and had no reason to know about." Kellar v. Summit Seating Inc., 664 F.3d 169, 177 (7th Cir. 2011) (plaintiffs have the burden of showing that they performed overtime work for which they were not compensated). "[A]n employer cannot be held liable for FLSA violations unless it has actual or constructive knowledge of an employee's overtime work." Boelk v. AT&T Teleholdings, Inc., 2013 WL 3777251, * 6 (W.D. Wis. 2013). Constructive knowledge under the FLSA means that the employee "had reason to know" or "should have known" that its employees were performing uncompensated work. Kellar, 664 F.3d at 177. Here, by solely relying on the records, Plaintiffs fail to establish that Metal Technologies was aware that its employees were taking unpaid lunch breaks of twenty minutes or less. See, e.g., Adair, 2008 WL 4224360, at *8 (finding that plaintiffs asserted facts that supervisors knew that employees performed work before their shifts, during their meal and rest breaks, and after their scheduled shifts, but that such knowledge was insufficient evidence to establish a common policy or practice to merit conditional certification). To establish liability, the Court would need to inquire into each employee's circumstances to determine whether that employee took unpaid lunch breaks of twenty minutes or less in violation of the FLSA.
Accordingly, conditional certification of the collective action is not warranted.
For the foregoing reasons, the Court
