Opinion
Case No. 2:05-cv-0500.
March 22, 2006
OPINION AND ORDER
On May 18, 2005 plaintiff Bruce Landsberg filed a complaint in this Court on behalf of himself and other similarly situated employees of defendant Acton Enterprises ("Acton"). The complaint alleges, inter alia, that Acton failed to pay store managers overtime compensation in violation of the Fair Labor Standards Act, 29 U.S.C. §§ 201, et seq. On November 28, 2005, Mr. Landsberg filed a motion to send opt-in notice to all store managers employed by Acton from May 20, 2002 through the present. For the following reasons, Mr. Landsberg's motion will be denied.
I.
According to the complaint, Mr. Landsberg was employed by Acton as a manager of a shoe and apparel store. As an Acton store manager, Mr. Landsberg "received a salary of $910.00 for each two week pay period worked for [Acton] as long as his hours averaged at least 47frac12: hours per week for each of the weeks in the pay period." Complaint at ¶ 9. Mr. Landsberg contends that sometimes his work week varied from the required 47frac12: hours. Id. at ¶¶ 10-11. Mr. Landsberg states that "[f]or pay periods in which the hours that Mr. Landsberg worked per week during that respective pay period fell below 47½ hours, but less than one-half of a work day, Defendant converted Plaintiff's pay to an hourly rate, and Plaintiff's pay was reduced below his base salary by the number of hours that he did not work." Id. at ¶ 12. Finally, the complaint claims that Acton "employs other employees in the same capacity as Plaintiff. These employees are similarly situated to Plaintiff." Id. at ¶ 14.
II.
Pursuant to 29 U.S.C. § 216(b), Mr. Landsberg seeks to bring his FLSA claim on behalf of himself and a class of similarly situated employees. The statute states, in relevant part, that:
An action to recover the liability prescribed in either of the preceding sentences may be maintained against any employer (including a public agency) in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought.29 U.S.C. § 216(b).
29 U.S.C. § 216(b) does not define "similarly situated." However, courts have adopted at least three different approaches to determining whether plaintiffs are "similarly situated" for § 216(b) purposes. As the Tenth Circuit Court of Appeals noted:
Under the first approach, a court determines, on an ad hoc case-by-case basis, whether plaintiffs are similarly situated. In utilizing this approach, a court typically makes an initial notice stage determination of whether plaintiffs are "similarly situated." In doing so, a court require[s] nothing more than substantial allegations that the putative class members were together the victims of a single decision, policy, or plan. At the conclusion of discovery (often prompted by a motion to decertify), the court then makes a second determination, utilizing a stricter standard of similarly situated. During this second stage analysis, a court reviews several factors, including (1) disparate factual and employment settings of the individual plaintiffs; (2) the various defenses available to defendant which appear to be individual to the plaintiff; (3) fairness and procedural considerations; and (4) whether plaintiffs made [any of] the filings required by [law] before instituting suit.
Under the second approach, district courts have incorporated into § 216(b) the requirements of current Federal Rule of Civil Procedure 23. For example, [some district courts] concluded that Rule 23(a)'s four prerequisites [numerosity, commonality, typicality, and adequacy of representation] and 23(b)(3)'s requirement that common questions of fact predominate should be used to determine whether plaintiff's are similarly situated.
In a third approach, district courts have suggested incorporating into § 216(b) the requirements of the pre 1966 version of Rule 23, which allowed for spurious class actions. Under the pre 1966 version of Rule 23, the character of the right sought to be enforced for the class of plaintiffs must be several, there must be a common question of law or fact affecting the several rights, and a common relief must be sought. Further, under the old Rule 23, district courts had inherent authority to refuse to proceed collectively where it would waste judicial resources or unfairly prejudice the party opposing the proposed class.Thiessen v. General Electric Capital Corp., 267 F.3d 1095, 1102-03 (10th Cir. 2001) (internal citations, footnotes, and quotations omitted; some brackets added for clarification).
This Court notes that the Sixth Circuit Court of Appeals has not yet decided which standard applies. For guidance, therefore, this Court reviews Judge Holschuh's decision in Harrison v. McDonald's Corp., 411 F.Supp.2d 862 (S.D. Ohio 2005), in which the court adopted and applied the ad hoc approach. InHarrison, the Court stated:
Courts have generally adopted a two-tiered certification approach for deciding whether a suit can proceed as a collective action. First, the court must determine whether notice of the pending action and the opportunity to "opt-in" should be given to potential class members. Such notice will usually be authorized if the plaintiff demonstrates that she is "similarly situated" to the other employees she seeks to notify of the pendency of the action. This is known as "conditional certification" of the collective action. After notice has been sent and discovery has been completed, the defendant can file a motion for decertification, challenging the court's preliminary determination that other employees are similarly situated.
With respect to the conditional certification stage, not all courts have agreed on what the plaintiff must do to demonstrate that other employees are similarly situated, but most courts agree that the standard is fairly lenient. Many courts have held that a modest factual showing is all that is required before a court authorizes notice to be sent to potential plaintiffs. A few courts, however, have held that this burden may be satisfied based solely on allegations in a complaint. * * *
* * *
In this Court's view, conditional certification should not be granted unless the plaintiff presents some evidence to support her allegations that others are similarly situated. Before subjecting an employer to the burdens of a collective action, plaintiffs must establish a colorable basis for their claim that a class of similarly situated plaintiffs exists.Harrison, 411 F.Supp.2d at 864-5, 868 (internal quotations and citations omitted). The burden is on the plaintiff to prove that other employees are similarly situated. Id.
In Harrison, the plaintiff brought an action under the FLSA against a restaurant claiming that the restaurant's managers manually altered the plaintiff's time records in order to avoid paying the plaintiff for all the hours she actually worked. Pursuant to 29 U.S.C. § 216(b), the plaintiff attempted to bring the claim on behalf of herself and a class of similarly situated employees. To support her "similarly situated" claim, the plaintiff submitted two affidavits and various other hearsay statements. Following the ad hoc approach, the court rejected plaintiff's argument that the plaintiff and the other employees were similarly situated. Besides disregarding the hearsay statements as inadmissible evidence in a 29 U.S.C. § 216(b) inquiry, the Court stated:
As Defendant notes, Plaintiff has, for many months, had access to contact information for the approximately 300 potential class members. Yet, as evidence that these employees are similarly situated in that they were not paid all of the wages to which they were entitled, [Plaintiff] has presented only her own affidavit and that of Eric Hamilton.Id.
In this case, the plaintiff submitted two affidavits to support the fact that he is similarly situated to other Acton employees. The first affidavit is from Mr. Landsberg, and the other is from another Acton store manager, Mike Johnson. Both affidavits state similar allegations — i.e. "[i]f I worked less than 47½ hours per week, I was automatically converted from a `salary' employee to an hourly employee compensated. . . ." Aff. of Bruce Landsberg at ¶ 6; Aff. of Mike Johnson at ¶ 6. Further, Mr. Landsberg's affidavit states, in pertinent part, that
[w]hile employed by Acton Enterprises, I was required to attend routine Manager's Meetings at the Acton Corporate Headquarters in Jeffersonville, Indiana. I attended at least three of these meetings during 2004.
These Manager's Meetings would last one or two days and be attended by Store Managers from all Acton Enterprises' store divisions, e.g., Shoe Sensation, Urban Attitude, Kicks, etc., and be attended by Store Managers from Acton stores in all states in which they had stores. Approximately fifty (50) to one-hundred (100) people would attend each of these meetings, including Store Managers, Area Managers, and upper management.
During these meetings, Store Managers from various states would usually be housed in a local hotel together. I, along with a number of other Store Managers present, would arrange to have dinner together in Jeffersonville.
During these dinners, attended only by Store Managers, the conversation between the other Store Managers would frequently include a discussion of the pay policies of Acton Enterprises. Specifically, the Store Managers would question why they were having their pay docked when they worked fewer than ninety-five hours during any given pay period, when they were considered to be on "salary," yet they were not paid any additional pay when they worked more than ninety-five hours per pay period, even though they would still work more than forty hours per week.
I specifically remember two Store Managers, one each from Kentucky and Pennsylvania stores indicate that they had had their pay docked for working less than ninety-five hours during certain two week pay periods. I also specifically remember other Store Managers also indicated being similarly docked for the same reason, though I cannot remember which stores they worked at nor their names.
Aff. of Brian Landsberg at ¶¶ 11-15. Further, Mr. Landsberg claims that because Acton uses ADP payroll service, "[i]t is highly unlikely that defendant, which used ADP to manage its payroll, would have created separate instructions to ADP for the payment of only plaintiff's wages." Mem. in Support of Motion to Send Opt-in Notice at p. 12.
A comparison between this case and Harrison reveals that the factual situations are nearly identical. Like the plaintiff inHarrison, Mr. Landsberg offers for support various statements made by other managers regarding the Acton pay policy. Specifically, Mr. Landsberg recalled various dinner conversations with other Acton managers while attending manager meetings in Indiana. Without any other foundation, these statements appear to be inadmissible hearsay, and as the Harrison court noted, hearsay statements cannot be used to determine whether employees are similarly situated for 29 U.S.C. § 216(b) purposes. See id. ("The Court finds that hearsay statements cannot be considered in connection with a Plaintiff's § 216(b) motion for the purpose of determining whether other employees are similarly situated"). Therefore, this Court must review the two affidavits to determine whether the employees are similarly situated.
This Court notes that the record is void as to how many potential plaintiffs may belong to this class of similarly situated employees. With just two affidavits to make the inquiry, however, this Court concludes that Mr. Landsberg failed to prove that the Acton employees are similarly situated. See, e.g., id. (plaintiff failed to satisfy burden that employees were similarly situated by providing only two affidavits out of 300 potential class members); Flores v. Lifeway Foods, Inc., 289 F.Supp.2d 1042, 1046 (N.D. Ill. 2003) (evidence that two out of fifty employees were not properly paid overtime wages "is not even a modest factual showing of a common policy or plan").
For many months, Mr. Landsberg had opportunities to obtain affidavits from additional Acton employees to prove that the managers were similarly situated. Yet, as evidence that these employees are similarly situated in that Acton illegal converted their "salary" to hourly wages if the managers failed to work the required 47½ hours per week, Mr. Landsberg has presented only his own affidavit and that of Mike Johnson, both of whom are Acton employees in Gallia County, Ohio. These two affidavits, coupled with a theory that it is "highly unlikely" that ADP would pay Mr. Landsberg differently than other employees, is simply not enough to establish a colorable basis for Mr. Landsberg's claim that a class of similarly situated plaintiffs exists.
Put simply, Mr. Landsberg has offered nothing but speculation to support his belief that other Acton managers, especially managers living outside of Gallia County, were not paid all of the money owed to them under Acton's "salary" work policy. In this Court's view, therefore, there is no basis for granting Mr. Landsberg's motion to send opt-in notice to all store managers employed by Acton from May 20, 2002 through the present. Accordingly, Mr. Landsberg's motion to send opt-in notice (doc. #14) is DENIED.
Any party may, within ten (10) days after this Order is filed, file and serve on the opposing party a motion for reconsideration by a District Judge. 28 U.S.C. § 636(b)(1)(A), Rule 72(a), Fed.R.Civ.P.; Eastern Division Order No. 91-3, pt. I., F., 5. The motion must specifically designate the order or part in question and the basis for any objection. Responses to objections are due ten days after objections are filed and replies by the objecting party are due seven days thereafter. The District Judge, upon consideration of the motion, shall set aside any part of this Order found to be clearly erroneous or contrary to law.
This order is in full force and effect, notwithstanding the filing of any objections, unless stayed by the Magistrate Judge or District Judge. S.D. Ohio L.R. 72.4.