Wage & Hour Litigation

New Massachusetts Legislation.

On April 14, 2008, Senate Bill No. 1059 (S. 1059) became law as a result of Governor Deval Patrick declining to take action on the legislation. The new law makes violations of Massachusetts’s wage and hour laws, including inadvertent violations, subject to mandatory treble damage awards with no available defense. In so doing, the law effectively overturns a 2005 Supreme Judicial Court case, which held that treble damages are punitive in nature and should be awarded only to punish willful misconduct. For more information on this new legislation, click here.

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Multi-plaintiff wage and hour lawsuits pose the greatest employment litigation threat to American businesses today. Since 2003, federal court filings of wage and hour collective actions have surpassed employment discrimination class actions, and settlements have reached into the tens of millions of dollars. Seyfarth Shaw’s defense of employers in wage and hour litigation has become one of the hallmarks of the firm’s nationally recognized employment practice. Our Wage & Hour Litigation Practice Group draws upon the counseling and litigation experience of its more than 80 attorneys in offices across the country, and in monthly meetings reviews recent developments and shares information to optimize results for our clients. We have litigated hundreds of complex wage and hour cases in state and federal courts, before administrative agencies, and on a multi-jurisdictional basis. In nearly every federal district and circuit court and in courts of almost every state, we have successfully defended a broad array of such claims. These cases include federal, state law, and hybrid class actions for:

• Misclassification of employees as exempt or as independent contractors
• Failure to pay otherwise exempt employees on a salary basis
• “Off-the-clock” and regular rate cases
• Donning and doffing activities
• Unpaid on-duty meal periods
• Denied reimbursements
• Miscalculated commissions and bonuses
• Tip pooling

While our practice is national in scope, we also have substantial experience successfully defending companies against state law wage and hour claims. In California, a state whose complex Labor Code poses unique risks for employers, Seyfarth Shaw’s employment lawyers boast a proven track record of effective representation against wage and hour class actions. For example, a team of our California lawyers recently obtained the first defense verdict in a major wage and hour class action jury trial. In another case, we defeated class certification in a “first-of-its-kind” meal period class action. Having handled in excess of 150 wage and hour class actions, we have become the “go-to” attorneys in California for the defense of such claims. Building upon this success, our firm has developed a multi-plaintiff wage and hour defense practice second to none, which benefits our clients nationwide.

We have defended our clients against all forms of multi-plaintiff wage and hour lawsuits, ranging from small classes to broad-based classes and opt-in groups numbering in the thousands. These cases have included high stakes litigation seeking unpaid wages (including overtime), punitive and liquidated damages, attorneys’ fees, and interest. Seyfarth Shaw’s collaborative and team-based approach to each case joins a comprehensive knowledge of wage and hour laws, regulations, and agency opinion letters with the firm’s extensive litigation experience, thus strengthening our effectiveness as defense counsel. We shape our defense strategy to the particular needs of each case and the business goals of our clients. This approach allows us to be extremely effective at defeating or minimizing exposure from such potentially high risk cases.

Attorneys in our Wage & Hour Litigation Practice Group have enhanced their broad legal and practical knowledge through years of advising employers about wage and hour compliance issues. Whether engaged in internal workplace audits, proactive litigation avoidance, assisting clients in implementing best practices, educating employers through case studies, authoring nationally published articles, white papers, and other materials, or defending threatened or pending litigation, we work diligently to understand how to assist our clients in modifying their personnel and pay practices in order to eliminate or lessen exposure and to reduce their potential for becoming targets for litigation. We believe the U.S. Department of Labor (DOL) has enough experience with our lawyers to know that we take a principled and professional approach to all of our advocacy before that body, we are confident that we have earned a level of credibility with the DOL that will ensure that our arguments for our clients are given appropriate consideration. Industries in which we have wide-ranging expertise include construction, financial services, health care, high tech, hospitality (hotels, restaurants, and tour operators), insurance, manufacturing, media (print and broadcast), professional services, public sector, retail (big box stores, independent stores, and call centers), telecommunications, and transportation. When litigation begins, the cumulative experience of our wage and hour trial lawyers permits us to achieve exceptional case management effectiveness. We have developed specific collective, class, and hybrid action, and multi-jurisdictional strategies that allow clients to successfully navigate the difficult procedural issues that often arise in wage and hour litigation:

• We start with a thorough initial case assessment, exposure analysis, and strategic plan, and assist clients through increasingly difficult document retention and litigation hold issues.
• We proceed with data and fact gathering, opposition to initial class certification, discovery, summary judgment, and ultimate class decertification if necessary.
• We conclude litigation as early as practicable, if not through dispositive motion practice, then, as appropriate, with mediation, settlement, trial, and appeal.

While multi-plaintiff wage and hour lawsuits have become a significant employment litigation threat, employers throughout the country have come to rely on Seyfarth Shaw’s Wage & Hour Litigation Practice Group to defend these cases effectively and efficiently and in a manner that brings them to conclusion consistent with our clients’ business goals. Our national platform, deep substantive knowledge in wage and hour law, lawyers seasoned in litigating these cases, and team-based approach differentiate us and make us a leading firm in this area of practice.

Proven Track Record

Our attorneys begin work on wage and hour cases at an advanced level, utilizing sophisticated data management and tested complex litigation experience. We are proud of our exemplary record in defending these claims. Examples of recent successes that we have secured for clients in wage and hour collective and class actions include:

• Defeating class certification in a state law overtime claim involving over 2,000 personal services industry employees and minimizing the putative class in a claim for issuing paychecks on an out of state bank, based on adequacy of representation, after elimination additional claims and defendants on summary adjudication. (U.S. District Court, Northern District of California.)
• Obtaining summary judgment for a large HMO in a class action in which a proposed class of 400 highly paid pharmacy managers claimed that they were misclassified as exempt and owed four years back overtime. (Los Angeles Superior Court.)
• Obtaining denial of class certification on plaintiffs’ FLSA claim alleging misclassification of temporary medical workers throughout New York City’s public health care system after an evidentiary hearing on plaintiffs’ conditional class certification motion. (U.S. District Court, Southern District of New York.)
• Obtaining dismissal with prejudice of a class action under the Illinois Wage Payment and Collection Act for the company’s alleged failure to pay for time spent donning and doffing uniforms. Carletto, et al. v. Quantum Foods Inc., No. 1-05-3163 (Ill. App. Ct. 1st Dist. 2006), appeal denied, 2006 Ill. LEXIS 1725 (Ill. 2006).
• Achieving the first defense jury verdict in a major wage and hour class action in California by defeating plaintiffs’ claim that the company, an office services provider, had not reimbursed business expenses of its 1,300 outside sales employees. This verdict followed summary judgments dismissing two alleged classes of outside sales personnel, decertification of another class claim, and favorable settlements of three other wage and hour claims. (San Francisco Superior Court.)
• Minimizing the size of the putative class in a misclassification case brought under the FLSA against a national financial services firm, which resulted in a very small number of opt-in plaintiffs, the decertification of the class, and the dismissal of a pendant state law claim. Trezvant v. Fidelity Employer Services Corp., 434 F. Supp. 2d 40 (D. Mass. 2006).
• Obtaining dismissal of a California class action alleging misclassification of programmers, senior programmers, analyst programmers, systems analysts, and senior systems analysts after the court held that the plaintiff was not representative of the putative class because of his limited work experience for the defendant company. (San Francisco Superior Court.)
• Achieving dismissal of a complaint brought by a proposed class of hundreds of waiters and waitresses who alleged that a large restaurant chain unlawfully diverted their customers’ tips to bartenders, whereas restaurants represented by other law firms have not been similarly successful. (Los Angeles Superior Court.)
• Prevailing on motions to dismiss putative nationwide state law wage payment and breach of contract class claims prior to any discovery or class certification in three companion cases brought against a Fortune 200 equipment manufacturer and supplier. (U.S. District Court, Western District of New York.)
• Defeating class certification at the initial stage of a federal lawsuit alleging that a professional staffing agency had misclassified certain employees as exempt. O’Donnell v. Robert Half Int’l, 429 F. Supp. 2d 246 (D. Mass. 2006).
• Obtaining early dismissal of state overtime law class action allegations on the basis that they irreconcilably conflict with collective action allegations under the FLSA. (U.S. District Court, District of New Jersey.)
• Defeating conditional certification of a putative class of financial services employees in a 13-state region because the court ruled that the evidence developed through discovery failed to establish a common plan or scheme to deprive employees of overtime pay, therefore making class treatment inappropriate. Compton v. Wells Fargo Financial, Inc., No. 04 CV 211 (W.D. Okla. 2006).
• Succeeding in obtaining a partial summary judgment in an FLSA misclassification case, which allowed for a settlement favorable to the company of the remaining claims, involving allegations that the company’s merchandise managers should have been treated as non-exempt employees. (U.S. District Court, Southern District of New York.)
• Securing dismissal of plaintiff’s state law opt-out class action brought as a companion claim in a nationwide FLSA collective action in federal court, thus limiting the case to those plaintiffs who affirmatively opt-in. (U.S. District Court, District of New Jersey.)
• Receiving court approval of a Rule 23 opt-out and FLSA §216(b) opt-in nationwide settlement class, on terms favorable to our client, resolving claims of telecommunication engineers, installers, and technicians for alleged unpaid overtime, meal periods, travel and waiting time, and termination pay; unrecorded time; wage record violations; unfair competition; and fraud and concealment under federal and various state laws. (U.S. District Court, Northern District of California.)
• Defeating in two separate lawsuits plaintiffs’ motions to allow exempt status claims to proceed as collective actions, which would have included approximately 1,000 alleged misclassified exempt employees of the City of Albuquerque, New Mexico. (U.S. District Court, District of New Mexico.)
• Convincing opposing counsel, as a result of an effective litigation strategy, to abandon their attempts to obtain conditional certification of a putative nationwide class of assistant store managers for a big box retailer who had allegedly been misclassified as exempt, and to settle the case on a single-plaintiff basis for a value advantageous to the employer. (U.S. District Court, Middle District of Florida.)
• Settling on favorable terms a nationwide collective and state-wide class action against a major retailer on allegations of off-the-clock work before and after employees’ shifts and during their meal periods. (U.S. District Court, Southern District of Florida.)
• Settling a large class action against an insurance company in which plaintiffs contested the exempt status of adjusters for the nominal sum of one dollar, whereas other insurers have settled similar cases for large amounts. (Los Angeles Superior Court.)
• Obtaining a court ruling that insurance claims adjusters perform exempt duties under the FLSA and Illinois law. Blue v. The Chubb Group, 2005 U.S. Dist. LEXIS 14253 (N.D. Ill. 2005).
• Obtaining summary judgment in favor of a large newspaper, which was upheld on appeal, in a high profile case that established that “charge-backs” against commissions were lawful under California law if done properly. Steinhebel v. Los Angeles Times Communications, 126 Cal. App. 4th 696 (2005).
• Granting motion for summary judgment on plaintiff’s commute time claim, ruling that service technicians were not entitled to compensation for the time commuting in the employer’s service vehicles, and denying plaintiff’s motion to certify a class action for alleged meal and rest period violations. (U.S. District Court, Central District of California, appeal docketed, 9th Circuit Court of Appeals 2006.)
• Persuading plaintiffs to abandon a class action against a health care organization after filing a motion to dismiss that convinced plaintiffs’ counsel early in the litigation that their clients’ legal position was untenable. (U.S. District Court, Southern District of Florida.)
• Prevailing on a motion to dismiss approximately one quarter of an alleged class of call center managers, who had been purportedly misclassified as exempt, after they had failed to appear for deposition, and subsequently obtaining the dismissal of their appeal to the Fifth Circuit for lack of jurisdiction. (U.S. District Court, Northern District of Texas; 5th Circuit Court of Appeals.)