JOAN M. AZRACKS, Magistrate Judge.
Plaintiffs Amadou Barry and Gungor Akcelik (collectively, "plaintiffs"), the named plaintiffs in this putative collective and class action,
The instant record consists of: (1) declarations from Barry, Akcelik, former named plaintiff Engin Malcok, and five other guards who opted in to this suit; (2) the deposition testimony of Barry, Akcelik, Malcok, and Frank Newton, defendants' Rule 30(b)(6) witness; (3) payroll records of the named and opt-in plaintiffs submitted by both plaintiffs and defendants; and (4) declarations of various guards and Newton submitted by defendants.
SEB is a security services company that employs uniformed and undercover security guards. Decl. of Frank Newton ("Newton Decl.") ¶¶ 3, 4, ECF No. 41. SEB operates in 22 states and employs approximately 2,000 guards. Newton Decl. ¶ 3; Dep. of Franklin Newton ("Newton Dep.") 68:14-15, Suppl. Reply Decl. of Suzanne Leeds, ECF No 68. SEB's guards are posted at over 150 locations, Newtown Decl. ¶ 3, including Walgreens pharmacies, King Kullen supermarkets, movie theatres, and hotels, Newton Dep. 67. Although the record does not indicate the precise number of undercover security guards, only a small portion of SEB's guards work undercover. Newton Dep. 73:2-9; 165:2-5;
To record their time, guards would sign in and out on timesheets at each location.
Although SEB paid guards overtime on some occasions, plaintiffs allege that SEB engaged in various practices that resulted in SEB not paying overtime for all hours worked and not paying overtime at the correct rate.
On October 19, 2011, plaintiffs Engin Malcok and Barry, who both worked as undercover guards, filed the instant complaint. Compl., ECF No. 1.
On May 7, 2012, plaintiffs served defendants with their motion for conditional certification under the FLSA. Not. Mot. Conditional Certif., ECF No. 38. The parties filed the fully briefed motion with the Court on July 20, 2012. ECF Nos. 38-45. In their opposition brief, defendants argued, inter alia, that the Court should deny conditional certification as to the uniformed guards because none of the named or opt-in plaintiffs who worked as uniformed guards had timely FLSA claims. Plaintiffs responded by submitting, along with their reply brief, a declaration from Akcelik, a uniformed guard. ECF No. 44. On July 26, 2012, plaintiffs also filed a pre-motion conference letter seeking to amend the complaint to add Akcelik as a named plaintiff in place of Malcok, whose FLSA claims were time-barred. ECF No. 46.
On August 27, 2012, Judge Townes referred three matters to me: (1) plaintiffs' motion for conditional certification; (2) plaintiffs' proposed motion to amend the complaint; and (3) a motion to dismiss that DiNozzi filed early in the litigation. Aug. 28, 2013 Order, ECF No. 50. On October 1, 2012, I held a pre-motion conference to address the pending motions. ECF No. 55. Defendants agreed not to oppose the motion to amend, and the Court allowed defendants to depose Akcelik and file a response addressing his testimony.
Currently before the Court is plaintiffs' motion for conditional certification.
Under Section 216(b) of the FLSA, a collective action may be maintained by named plaintiffs "for and in behalf of . . . themselves and other employees
By allowing employees to proceed collectively, collective actions provide plaintiffs "the advantage of lower individual costs to vindicate rights by the pooling of resources" and allow "efficient resolution in one proceeding of common issues of law and fact arising from the same alleged [unlawful] activity."
FLSA collective actions often proceed in two stages.
District courts have discretion, in "appropriate cases," to facilitate notice at the conditional certification stage.
At the conditional certification stage, "the court does not resolve factual disputes, decide substantive issues going to the ultimate merits, or make credibility determinations."
Plaintiffs argue that SEB's policy of not paying guards for time they spend traveling between worksites results in unpaid overtime and warrants conditional certification. Plaintiffs also contend that, although SEB paid some overtime, SEB has a general practice of not paying overtime for all hours worked, which is evidenced primarily by: (1) SEB's failure to pay overtime at the proper rate; and (2) instances where guards' hours were "shorted." Additionally, plaintiffs raise, in passing, a claim that SEB failed to pay guards for travel expenses. Plaintiffs request that the Court authorize notice to all guards nationwide for these claims.
In response to plaintiffs' travel time claims, defendants argue that: (1) fact-intensive individualized inquiries will be necessary to determine, for each instance of travel time, the `amount of time the guard spent traveling as well as the compensability of that time; and (2) conditional certification is not appropriate for undercover guards because they rarely, if ever, travel between worksites. Defendants also argue that plaintiffs' allegations of "shorting" and payment of overtime at improper rates are too sporadic and anecdotal to suggest unlawful policies or practices.
Some of defendants' arguments rely on the competing declarations from current employees that defendants have submitted ("defendants' declarations"). Before turning to the specific practices plaintiffs allege, the Court will address the preliminary question of what, if any, weight the Court should give to the defendants' declarations.
Defendants have offered declarations from current employees and other evidence in an effort to undermine plaintiffs' proof. However, courts in this Circuit regularly refuse to rely on such declarations when plaintiffs have not yet had an opportunity to depose the declarants.
Here, the Court will not rely on defendants' declarations, which seek to rebut plaintiffs' allegations. Rather, the Court will focus on plaintiffs' declarations and the deposition testimony of the named plaintiffs. Of course, to the extent that any evidence defendants submit actually helps plaintiffs' case, the Court will consider it.
Plaintiffs argue that time they spend traveling between worksites is compensable. The general rule is that time spent traveling from job site to job site during a workday is compensable under the FLSA. 29 CFR § 785.38. By contrast, commuting from home to work is ordinarily not compensable. 29 CFR §§ 785.35, 785.36.
SEB does not pay undercover or uniformed guards for the time they spend traveling from one worksite to another. Newton Dep. 173:9-21; 175:2-176:3; 176:18-177:4; see also, e.g., Dep. of Amadou Barry ("Barry Dep.") 98:7-100:6, Reply Decl. of Suzanne B. Leeds in Further Supp. Conditional Certif. Mot. ("Leeds Reply Decl.") Ex. K.
Although guards would sign in and out on time sheets at each worksite, see, e.g. Barry Decl. ¶ 7, SEB did not have the guards record the time they spent traveling between worksites.
To minimize the likelihood of being recognized, undercover guards work at different locations each day, and also work short shifts, of five or fewer hours, at each location. Newton Decl. ¶ 6. Because their shifts at each location are short, many undercover guards work two shifts, at different locations, in a single day.
A number of factors affect the amount of time undercover guards spend traveling each day between job sites. Because undercover guards work in different locations each day, their daily travel time between work locations varies. Moreover, guards use different modes of transportation to travel between worksites. Some guards use public transportation and taxis while others drive between job sites.
In contrast to undercover guards, uniformed guards, who do not need to avoid detection, work longer shifts and are usually posted at the same location each day. Newton Decl. ¶ 7. However, on infrequent occasions, uniformed guards will work at two different locations on the same day.
The record concerning the work schedules and travel time of uniformed guards is sparse. The only detailed evidence on this issue is Akcelik's deposition testimony.
Akcelik's testimony reveals two circumstances that could cause uniformed guards to work in two different locations on the same day and travel between job sites. First, on some occasions, Akcelik would arrive at a client site and work for an hour, only to have the SEB dispatcher inform him that there had been a mistake and that Akcelik needed to report to a different location that was 10 or 15 miles away. Akcelik Dep. 52:5-53:8; 54:12-16. It appears that SEB would not pay Akcelik for this travel time.
Second, SEB might need a guard to cover another guard's shift. Akcelik Dep. 37:7-14. This could, but would not necessarily, result in travel time. All of the specific incidents involving shift coverage in Akcelik's deposition follow the same pattern: Akcelik, who worked the night shift, would finish his shift at 6 a.m. on Saturday morning and return home for his day off when he would receive a call from SEB directing him to work at a different location sometime later that day. Akcelik Dep. 98:12-104:7. None of these instances involved Akcelik traveling from one worksite to another; instead, he traveled from his home to the second assignment. However, another uniformed guard, whose declaration defendants provided, admitted that he would travel between work sites when he needed to cover for another guard.
Defendants' primary argument against both the undercover and uniformed guard classes is that fact-intensive individualized inquiries will be necessary to determine various issues, including the amount of time each guard spent on any given day traveling between work sites. However, determining the amount of each guard's travel time is essentially a question of damages and does not justify denying conditional certification here. Additionally, defendants' argument that conditional certification of the uniformed guards' claims is inappropriate because they rarely, if ever, traveled between worksites, does not persuade the Court. Thus, the Court grants conditional certification for the travel time claims of all undercover and uniformed guards.
Although defendants often argue that the necessity of fact-intensive individualized inquiries will render a collective action unmanageable, the majority of courts in this Circuit decline to consider such arguments at the conditional certification stage, and, instead, put these issues off until the decertification stage, when discovery is complete.
Moreover, courts have conditionally certified classes in large off-the-clock cases despite the individualized issues such cases present.
In contrast to these cases, SEB points to some decisions denying conditional certification in large off-the-clock suits because numerous individualized inquiries would be necessary to resolve liability and damages.
Although each guard may have to testify about how often he engaged in travel time and how much time he spent traveling, the Court finds this is not a bar to conditional certification.
SEB also contends that individualized inquiries will be required to resolve: (1) the compensability of the guards' "down-time"; (2) SEB's de minimis defense; and (3) the question of whether SEB had actual or constructive knowledge of the guards' compensable travel time. However, many of the issues related to these defenses could potentially be resolved on a class-wide basis. Any individualized issues that remain can likely be addressed in subsequent damages proceedings. For example, in determining whether work time is de minimis and, thus, not compensable, courts look to: "(1) the practical administrative difficulty of recording additional time; (2) the size of the claim in the aggregate; and (3) whether the claimants performed the work on a regular basis."
Conditional certification is clearly appropriate for the undercover guards' travel time claims given that the number of undercover guards is relatively small. Defendants' other arguments against certification of the undercover guard's travel time claims are meritless.
Although there are many more uniformed guards, the Court finds that their travel time claims are also suitable for conditional certification.
In addition to defendants' general objections to collective treatment of this type of off-the-clock suit, defendants also argue that because uniformed guards rarely, if ever, travel between worksites, plaintiffs have failed to show that SEB had a company-wide policy to regularly require uniformed guards to travel between work locations without compensation. Plaintiffs respond that "unpaid travel time was a common occurrence for uniformed [guards]." Pls.' Suppl. Reply Mem. Supp. Mot. Conditional Certif. at 4, ECF No. 68.
Although travel between worksites was not a common occurrence for uniformed guards, the practice of uniformed guards sporadically covering the shifts of fellow guards appears widespread and seems likely to lead to some travel time claims for a substantial number of uniformed guards. This practice, along with SEB's policy of not paying for travel time, warrants conditional certification of the uniformed guards' travel time claims.
Finally, plaintiffs seek nationwide notice for both the undercover and uniformed guards. SEB raises various arguments to limit the scope of the class, none of which are persuasive. Although the opt-ins' only worked in the tri-state area, that is not a compelling reason to limit notice to guards in that geographic region. SEB has a company-wide policy of not paying for travel time and one would expect that the experiences of undercover and uniformed guards in other regions concerning travel time will generally mirror the experiences of the opt-ins. Accordingly, the Court authorizes nationwide notice to all undercover and uniformed guards.
Plaintiffs allege that SEB has a general policy of not paying overtime wages due for all hours worked. As evidence of this alleged catch-all policy, plaintiffs cite: (1) incidents where plaintiffs' hours were "shorted"; and (2) SEB's alleged payment of overtime at straight-time wages. As explained below, the Court grants conditional certification for these claims as to all uniformed and undercover guards.
Plaintiffs' evidence regarding "shorting" of hours is suggestive of a company-wide practice.
Each opt-in's declaration asserts that he was "consistently" or "typically" "shorted" hours, with the declarants' estimates generally ranging from one to four "shorted" hours each week.
The deposition testimony of Malcok, Barry, and Akcelik provides greater detail about plaintiffs' "shorting" claim. On a few occasions, Barry and Malcok were not paid for all of the time that they recorded on their time sheets. Barry Dep. 74:18-75:13, 76:16-77:15; Malcok Dep. 74:6. This would occur for various reasons: (1) another guard would fail to fax a store's weekly time sheet to SEB at the end of the week
Although Akcelik was initially not paid for all of his hours on two or three occasions one month, he was eventually paid for this time after he complained to the nephew of SEB's owner. Akcelik Dep. 44:13-45:2. Akcelik only recalled one other incident where he was not paid correctly. On one occasion, he never received $120 despite complaining to his supervisor, who indicated that he would let the accounting department know about the problem.
Akcelik also testified about the experience of another uniformed guard, named Zeynep, who was shorted hours.
In addition to the incidents of "shorting" discussed above, plaintiffs also note that SEB has a general policy of trying to reduce overtime because SEB is unable to bill overtime to its clients, and, thus, loses money on every hour of overtime. Newton Dep. 66, 166-67. Although this policy is facially lawful, it has some general relevance to plaintiffs' claims.
Plaintiffs essentially ask the Court to infer, from all of the evidence above, that SEB had, as part of a general policy to deny overtime, a company-wide practice of "shorting" guards' hours. SEB counters that plaintiffs' claims of shorting are too sporadic and anecdotal to suggest a common unlawful policy.
This is a close question. Ultimately, the Court finds plaintiffs' evidence sufficient to suggest an unlawful practice. Notably, each deposed plaintiff testified to instances where guards were not properly paid despite complaining to supervisors or the payroll department.
Conditional certification for all undercover and uniformed guards is warranted on this claim. Payroll is centralized, and some of the plaintiffs' complaints to payroll were not addressed, suggesting that, if an unlawful policy exists, it was not limited to certain supervisors.
Conditional certification is also warranted as to plaintiffs' claims regarding payment of overtime at improper rates.
In response, SEB points out that, on at least some occasions, plaintiffs were indisputably paid one-and-a-half-times their straight-time rate.
In a footnote, SEB raises an affirmative exemption defense that, in certain situations, allows employers to use hourly rates for different work. 29 U.S.C. § 207(g)(2). SEB contends that it paid different hourly rates for different clients pursuant to § 207(g)(2) and suggests that, even if this defense might be inapplicable for certain guards and certain weeks, such claims are too sporadic and individualized to resolve on a collective basis. Plaintiffs do not address this defense.
Where an exemption defense is central to a case, plaintiffs may be required to make "some showing" that they are similarly situated with respect to that exemption.
At this stage, plaintiffs' assertions that they were paid at improper rates suggests that the guards are similarly situated with respect to this practice and to plaintiffs' allegation of a general policy to deny overtime. Accordingly, the Court conditionally certifies plaintiffs' claims based on hours shorting and payment of overtime at improper rates.
In their declarations, plaintiffs allege that they were not reimbursed for their travel expenses in commuting to work or traveling between worksites. Defendants respond that travel expenses are not compensable under the FLSA. Plaintiffs do not respond to defendants' argument and do not articulate how their travel expense allegations could possibly give rise to claims under the FLSA. However, because the Court is already authorizing notice to all guards on plaintiffs' other claims and plaintiffs' proposed notice does not even mention the travel expenses claim, the Court sees no reason to address the travel expenses claim here. See Proposed Notice, Decl. of Suzanne Leeds Supp. Mot. Conditional Certif. Ex. H, ECF No. 39.
The FLSA has a three-year statute of limitations, which runs from the date an opt-in files a consent. 29 U.S.C. § 256(b). Plaintiffs, however, request that notice be sent to all guards who worked at SEB since October 19, 2005-a six-year period running from the filing of the complaint. Defendants suggest a three-year notice period.
Some decisions in this Circuit have authorized notice going back six years because parallel NYLL claims have a six-year statute of limitations. Courts, however, are divided over this issue.
The Court agrees with the decision in
Where a court refuses to authorize a six-year notice period, "[n]otice would normally be provided to those employed within three years of the date of the notice."
Although the FLSA's statute of limitations ordinarily runs from the date an opt-in files a consent form, where plaintiffs have diligently pursued their claims, some courts have equitably tolled the statute of limitations while a motion for conditional certification is pending before the court.
The Court directs the parties to confer regarding the contents of the notice. The Court will, however, resolve two issues that SEB raises regarding plaintiffs' proposed notice. First, the notice shall state: "If you choose to join this case, you may be required to participate in written discovery, submit to a deposition, and/or testify at trial." Second, the 60-day opt-in window that plaintiffs propose is appropriate. The parties shall submit a revised notice by December 11, 2013. If the parties have any remaining disputes over the notice, they should contact the Court to schedule a telephone conference.
For the foregoing reasons, plaintiffs' motion for conditional certification is granted. By December 11, 2013, the parties shall provide a revised proposed notice form to the Court and plaintiffs shall file their amended complaint.
