Lillehagen v. Alorica, Inc.
| Decision Date | 10 December 2014 |
| Docket Number | Case No.: SACV 13-0092-DOC(JPRx) |
| Court | U.S. District Court — Central District of California |
| Parties | MELISSA LILLEHAGEN, et al., on behalf of themselves and all those similarly situated, Plaintiffs, v. ALORICA, INC., Defendant. |
Before the Court are Plaintiffs' Motion for Partial Summary Judgment ("P-MSJ") (Dkt. 159), Defendant's Motion for Summary Judgment ("D-MSJ") (Dkt. 135), and Defendant's Motion to Decertify Collective Action ( ) (Dkt. 138). After reviewing the papers and hearing the oral arguments, the Court DENIES Plaintiffs' Motion for Partial Summary Judgment, GRANTS IN PART AND DENIES IN PART Defendant's Motion for Summary Judgment, and DENIES Defendant's Motion to Decertify.
This lawsuit was filed on January 18, 2013. See Compl. (Dkt. 1). Named Plaintiffs Melissa Lillehagen, Sharon Shaw, Janna Carlile, Shanai Whitmore, Brenda Luper, and Ignacio Pizana (collectively, "Plaintiffs") are current and former employees of Defendant Alorica, Inc. ("Alorica"). Id. ¶ 3.1 This action involves a single claim under the Federal Labor Standards Act (FLSA). Plaintiffs allege that Alorica uses a company-wide compensation scheme for its customer service representatives ("CSRs") which treats breaks of less than 20 minutes during a CSR's continuous workday as uncompensated time. Specifically, Alorica calculates CSRs' pay based on when CSRs log in and log out of a timekeeping system and does not pay CSRs for times during the day when they are logged out for brief periods of under 20 minutes. Plaintiffs argue that, under FLSA, all of these brief log-out periods should be compensated as hours worked. D-SUF No. 8; Compl. ¶ 7.
On October 24, 2013, the Court conditionally certified a nationwide FLSA class of all individuals who work or have worked as Alorica CSRs between August 9, 2010 to the time of trial, excluding CSRs who worked only at Alorica's facility in Terre Haute, Indiana during this time period. Order Granting Pls.' Mot. for Conditional Class Certification, Oct. 24, 2013 ("Class Cert. Order") (Dkt. 67); Order Denying in Part Objections to Proposed Notice, Oct. 31, 2013 (Dkt. 72) at 1.2 Potential class members were notified and over 8,700 individuals opted in to the collective action. See Notices of Consent to Join (Dkts. 53, 68, 74, 77, 80, 88, 90-103, 105, 108-114).
On September 22, 2014, Plaintiffs and Defendant filed cross-motions for summary judgment (Dkts. 135, 159). Defendant also filed a motion to decertify the collective action and a motion to compel 155 of the Opt-In Plaintiffs to arbitrate (Dkts. 137, 138). Oppositions, replies,and additional briefing were filed (Dkts. 171, 172, 184, 185, 191, 193, 194, 195, 215). Oral argument was heard on the motions on November 17, 2014 (Dkt. 213).
Alorica provides telephone-based customer services for its corporate clients, including telephonic technical support and telephonic sales services and support. Between January 18, 2010 and the present, Alorica acquired two other call center companies, Ryla Teleservices, Inc. ("Ryla") and PRC, LLC ("PRC"), as well as all of their accounts. The over 8,700 CSRs who have opted into this collective action worked at approximately 37 different call center locations in at least 16 states. CSRs are on the front line of Alorica's business. They handle inbound and outbound telephone calls with customers of Alorica's clients and provide them with service and support. See Pls.' Statement of Uncontroverted Facts ("P-SUF") (Dkt. 160) No. 3-4; Defs.' Statement of Uncontroverted Facts ("D-SUF") (Dkt. 136) No. 1-2.
CSRs are non-exempt employees and Alorica pays them by the hour, on a biweekly basis. Full-time CSRs typically work an eight-hour shift, excluding their unpaid meal period. Alorica typically provides CSRs with one scheduled 30-45 minute meal period per eight-hour shift and two scheduled breaks of 10-15 minutes each per eight-hour shift. See P-SUF Nos. 5-9; D-SUF No. 9. In addition to their two scheduled breaks, CSRs sometimes take unscheduled breaks during their shifts to use the restroom or to get a glass of water or a snack. P-SUF Nos. 41-42.
Alorica requires CSRs to track their time worked by using an electronic timekeeping system at their workstation. P-SUF No. 10. Most of Alorica's facilities use a proprietary timekeeping system called Employee Information System (EIS), although Alorica also used Kronos at select sites until 2013. P-SUF No. 13; Declaration of Anne Romagnino ¶ 8 (Dkt. 141). CSRs must use "login" and "logout" buttons on their phones or computers each day to record when they start and stop work. P-SUF No. 11. The phone log-in system is referred to as the "hard phone" system; the computer log-in system is referred to as the "soft phone" system. D-SUF No. 11.
To start recording their work time on EIS, CSRs log into the timekeeping system by pressing the "LOGIN" button on their phone or computer. P-SUF No. 14. When CSRs get logged out of the system, EIS stops recording their work time. P-SUF No. 15. During the day, in addition to using the LOGIN and LOGOUT buttons, a CSR will also use various "AUX" buttons on their phone or computer. When the CSR's system is in "AUX mode," his or her phone temporarily stops receiving calls. P-SUF No. 46. CSRs are not paid for time recorded in EIS under the "Lunch" AUX code. CSRs are paid for time recorded in EIS under other AUX codes, which include "Break" (for scheduled breaks and unscheduled breaks), and other codes. P-SUF Nos. 47-49.
It is uncontroverted that Alorica had certain written policies for CSRs and for managers of CSRs regarding timekeeping. In general, the written policy was for CSRs to log in at the beginning of their shift and stay logged into the EIS system until the end of the shift when they would log out. When CSRs took their twice daily scheduled breaks or bathroom breaks as necessary, they were supposed to use the "Break" AUX code rather than log out. When CSRs had lunch, they were supposed to use the "Lunch" AUX code rather than log out, except that CSRs at certain facilities during certain time periods had to log out for lunch and then log back in upon returning from lunch because their timekeeping system did not have a "Lunch" AUX code. D-SUF Nos. 17-20.
Alorica's written timekeeping policies emphasized that CSRs were responsible for logging in and out and using AUX codes correctly in order for them to be paid correctly. D-SUF Nos. 18-20. Alorica's written policies also emphasized the importance of "schedule adherence," which included good attendance, punctuality, and adherence to the daily schedule that managers established for the CSRs. Alorica's Employee Handbook warned that employees could be subject to disciplinary action, including termination of employment, for excessive absences, tardiness, or failures to adhere to the schedule. Declaration of David N. Tarlow (Dkt. 148) Ex. C (Beckerley Dep. Ex. 3, Aug. 5, 2014); Ex. D (Campos Dep. Ex. 2, Aug. 1, 2014); Ex. L (Shaw Dep. Ex. 23, Mar. 5, 2014).
Alorica also had written policies for managers. On July 15, 2013, Alorica's Vice President of Human Resources and Administration sent a memorandum to various Alorica managers with the subject "2013 Mid-Year Log In-Log Off Break Policy Clarification." The memo admonished, "Management is not to log out employees from the system while on Break Aux Code" and warned managers, "Do not ask employees to log out of the system for rest or restroom breaks." P-SUF Nos. 56-58. One exception was that managers could log employees out of the system if the employee was gone from his or her workstation for more than 30 minutes and the manager had conducted a diligent search for the employee. Declaration of Allen R. Vaught ("First Vaught Decl.") (Dkt. 162) Ex. E (Smith Dep. Ex. 315, Aug. 5, 2014).
Plaintiffs do not dispute that Alorica had such written policies, but do dispute whether Alorica actually communicated and enforced them. Some managers instructed CSRs to log out when they took breaks instead of using the AUX code. Carlile Dep. 21:21-22:4, Apr. 29, 2014; Reynolds Dep. 23:17-24:21, Mar. 6, 2014; Shaw Dep. 103:2-11; Amend Dep. 48:6-10, 49:1650:13, Mar. 27, 2014. Some managers would log CSRs out of EIS while the CSRs were away from their workstations to either perform work-related activities and when taking breaks. Some of the CSRs who testified that they themselves had been logged out or that they had seen other CSRs logged out generally could not recall exactly how long they or their co-workers were away from their workstations. Bass Dep. 70:15-73:25, 76:3-77:15, Aug. 12, 2014; Beckerley Dep. 51:23-54:4, Aug. 5, 2014; Campos Dep. 79:24-83:24; Carlile Dep. 57:5-22; Lillehagen Dep. 13:17-20, 89:6-90:21, Mar. 14, 2014; Luper Dep. 60:5-63:23, July 11, 2014; Moore Dep. 62:25-65:21, Aug. 11, 2014; Tellez Dep. 60:21-61:25, Aug. 1, 2014. Sometimes other issues got in the way of accurate timekeeping, such as computer failures that caused CSRs to be involuntarily logged out. P-SUF No. 37. Or, sometimes CSRs had to log out to switch computer workstations. P-SUF No. 38. Managers did not always automatically correct CSRs' timesheets so that CSRs would be compensated for those times. Whitmore Dep. 156:9-158:19, Mar. 4, 2014.
Alorica calculates a CSR's wages based on the total hours logged in EIS and on the manager's adjustments or corrections. P-SUF No. 18, 21; Romagnino Decl. ¶¶ 6-8 (Dkt. 141). Managers can make manual adjustments or corrections to a CSR's timesheet in EIS before the timesheets are locked at the...
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