Myers v. Iowa Bd. of Regents

• Citation: 458 F.Supp.3d 1075
• Decision Date: 05 May 2020
• Docket Number: Case No. 3:19-cv-00081-SMR-SBJ
• Parties: Melinda MYERS, Barbara Stanerson, John Eivins, Liv Kelly-Sellnau, Christopher Taylor, and Shuna Tosa, on behalf of themselves and others similarly situated, Plaintiffs, v. IOWA BOARD OF REGENTS, Defendant.
• Court: U.S. District Court — Southern District of Iowa

458 F.Supp.3d 1075

Melinda MYERS, Barbara Stanerson, John Eivins, Liv Kelly-Sellnau, Christopher Taylor, and Shuna Tosa, on behalf of themselves and others similarly situated, Plaintiffs,

v.IOWA BOARD OF REGENTS, Defendant.

Case No. 3:19-cv-00081-SMR-SBJ

United States District Court, S.D. Iowa, Davenport Division.

Signed May 5, 2020

Nathan T. Willems, Rush & Nicholson, Cedar Rapids, IA, Benjamin J. Weber, Pro Hac Vice, Harold L. Lichten, Pro Hac Vice, Lichten & Liss-Riordan, P.C., Boston, MA, for Plaintiffs.

Andrew T. Tice, Lindsay A. Vaught, Jason Michael Craig, Ahlers & Cooney PC, Des Moines, IA, for Defendant.

ORDER ON DEFENDANT'S MOTION TO DISMISS AND PLAINTIFFS' MOTION FOR CONDITIONAL CERTIFICATION

STEPHANIE M. ROSE, JUDGE

In this putative class action Plaintiffs allege violations of the Iowa Wage Payment and Collection Law ("IWPCL") and the Fair Labor Standards Act ("FLSA") for delayed overtime remunerations and termination pay against Defendant Iowa Board of Regents ("the Board"), an administrative subdivision of the state government. See [ECF No. 1-1 at 46–60]. Plaintiffs seek conditional certification of their FLSA collective action, [ECF No. 14], but the Board moves to dismiss, asserting that claim is barred by the state's sovereign immunity, [ECF No. 20]. The Board has waived its sovereign immunity to suit under the FLSA, and conditional certification is proper. Accordingly, the Board's Motion to Dismiss is DENIED, and Plaintiffs' Motion for Conditional Certification is GRANTED.¹

I. BACKGROUND

Plaintiffs in this case are current and former employees of the University of Iowa Hospitals and Clinics ("UIHC"), a state medical facility operated and managed by the Iowa Board of Regents. [ECF No. 1-1 at 48–49 ¶¶ 1–6, 8–9]. Their three-count Amended Petition, originally filed in the Iowa District Court for Johnson County, alleges claims for timely payment of wages under both state and federal labor law on behalf of three separate classes of workers. In Count I, the "Wages Class," consisting of former, current, and future healthcare providers at UIHC, brings suit to enforce their right to timely payment of earned wages under the IWPCL, Iowa Code § 91A.3. Id. at 8 ¶¶ 27-33, 14 ¶¶ 50–52. In Count II, the "Termination Pay Class," also consisting of former, current, and future healthcare providers at UIHC, sues for timely payment of accrued vacation pay upon the end of their employment with UIHC under the IWPCL, Iowa Code § 91A.4. Id. at 10 ¶¶ 34–41, 14 ¶¶ 53–56. Pertinent to the present motions is Count III, in which the "Overtime Pay Class," consisting of all former, current and future employees who UIHC designates as non-exempt from overtime pay, brings suit to enforce their right to be timely paid overtime premiums or shift differentials as provided by the IWPCL, Iowa Code § 91A.3, and the FLSA, 29 U.S.C. § 207(a). Id. at 12 ¶¶ 42–49, 14–15 ¶¶ 57-59.

UIHC pays overtime wages to its eligible employees through the Board's collective bargaining agreements, operations manual, and employee handbook. See [ECF No. 26-1 at 4] (UIHC Operations Manual) (describing overtime pay policies for "staff members who are eligible for overtime under the [FLSA]" including "all merit staff, as well as non-exempt professional and scientific staff"); id. at 16 (collective bargaining agreement) (describing pay classifications and denoting classes of workers who are "non-exempt under the [FLSA]"); id. at 26 (employee manual) ("Bargaining unit classifications are designated by the Employer as exempt or non-exempt in accord with the [FLSA]. Those designated as non-exempt are eligible for overtime consistent with the Act."). According to the Amended Petition, UIHC violates Plaintiffs' rights under the FSLA by consistently and purposefully paying overtime wages on an untimely basis. Non-exempt employees at UIHC included in the Overtime Pay Class are labeled as "merit" employees subject to the Iowa state employee merit system. See Iowa Code § 8A.412. These employees include custodians, clerical workers, and health care technicians, among others. [ECF No. 14-1 ¶¶ 3–4, 6]. Certain professional and scientific employees, or "P&S" employees, are also labeled as non-exempt by UIHC. Id. ¶ 5. Plaintiffs are paid on a monthly basis. Yet, they claim their wages for overtime hours are not paid along with their regular wages for the pay period in which they are earned; rather, the overtime remunerations are paid along with wages for a different pay period, one month or more later. UIHC's written Human Resources Policy for Merit, Merit Exempt and Non-Exempt P&S Time Records, the plan to which Plaintiffs of the Overtime Class claim they are subject, states: "Adjustments computed from your monthly time record can include payments for overtime .... These payments will always be one month in arrears—for example, adjustments recorded for October will be reflected in the pay you receive during December." [ECF No. 14-1 ¶ 2]; see also id. at 3. Thus, Plaintiffs allege UIHC only pays its non-exempt workers their base rate for their work during a given pay period; they do not pay the overtime premium, or "adjustment," until a later paycheck. This practice, they claim, violates the FLSA.

As a representative of the Overtime Pay Class, Shuna Tosa, a custodian at UIHC and named Plaintiff, states her earning history reflects this overtime pay policy in practice and demonstrates she is routinely not paid for her overtime work until a paycheck one month later. [ECF No. 14-2 ¶¶ 7–12]. Tosa points to her time records and paycheck review for the pay period between May 1, 2018, and December 1, 2018. See id. at 4–19. Tosa asserts that on numerous occasions she worked more than forty hours in one week, entitling her to overtime pay. Id. ¶¶ 7, 10. But while she was paid her base salary on the first of every month, Tosa's records show her paycheck for that pay period did not include the overtime pay that she had earned; instead, she did not receive that overtime pay until the paycheck covering the period after the one in which she worked the overtime hours (i.e., one month later). Id. ¶¶ 7–12. For instance, even though she worked fifty-nine hours the week of May 7, 2018, and received her base salary for that May pay period on June 1, 2018, she did not receive her overtime pay for that period until July 1, 2018. Id. ¶¶ 7–9. Similarly, she states she worked approximately sixty hours the week of June 4, 2018, and although she received her base pay on July 1, 2018, she did not receive her overtime pay for that week until August 1, 2018. Id. ¶¶ 10–12. Tosa asserts other UIHC workers similarly situated to her are subject to the same practice. Id. ¶¶ 6, 13.

After the case was removed to federal court, Plaintiffs—specifically, the Overtime Pay Class—sought conditional certification of their overtime wage claim as a collective action under § 216(b) of the FLSA. [ECF No. 14]. In addition to resisting that motion, the Board moved under Rules 7(b) and 12(h) to dismiss Count III of the Amended Petition on the basis that Plaintiffs' FLSA claim against the Iowa Board of Regents is barred by the state's sovereign immunity. [ECF No. 20].

II. MOTION TO DISMISS

The Board claims the Court lacks subject matter jurisdiction to preside over Plaintiffs' FLSA claim because Iowa's sovereign immunity precludes private suit for money damages against it as an arm of the state. Expressly or impliedly, Plaintiffs insist, the State has subjected the Board to private suit under the FLSA through the statutory scheme of the IWPCL and the Board's accompanying treatment of its employees' rights vis-à-vis the FLSA. The Court agrees the Board's policies, in the context of Iowa's wage payment statute, constructively waive its sovereign immunity.

A. Standard of Review

"[I]t is axiomatic that ... sovereign immunity implicates [federal courts'] subject matter jurisdiction ... and the government may raise it at any stage." Jones v. United States , 255 F.3d 507, 511 (8th Cir. 2001). And "[i]f the court determines at any time it lacks subject-matter jurisdiction"—that is, if it determines a claim to be barred by a state's sovereign immunity—"the court must dismiss" that claim. Fed. R. Civ. P. 12(h)(3). Plaintiffs bear the burden of proving subject matter jurisdiction. Great Rivers Habitat All. v. FEMA , 615 F.3d 985, 988 (8th Cir. 2010) ; see Yaakov v. Varitronics, LLC , 200 F. Supp. 3d 837, 839 (D. Minn. 2016) ("A motion to dismiss for lack of subject matter jurisdiction under Rule 12(h)(3) is governed by the standard of Rule 12(b)(1)."). They likewise bear the burden of proving a waiver of sovereign immunity. V S Ltd. P'ship v. Dep't of Hous. and Urban Dev. , 235 F.3d 1109, 1112 (8th Cir. 2000) ; Olson v. Soc. Sec. Admin. , 243 F. Supp. 3d 1037, 1053 (D.N.D. 2017) ; see also Lee v. State , 815 N.W.2d 731, 743 (Iowa 2012) (concluding the Iowa plaintiff failed to fulfill her "burden to show that the exclusion of the [statutory] language was designed to [constructively] waive sovereign immunity"). Because the Board fails to specify whether it launches a "facial" or "factual" attack on the Court's jurisdiction, see Titus v. Sullivan , 4 F.3d 590, 593 (8th Cir. 1993) (citing Osborn v. United States , 918 F.2d 724, 729 n.6 (8th Cir. 1990) ), the Court presumes its post-answer motion consists of a broad factual challenge in which the Court has "wide discretion" to consider matter outside the pleadings, see Johnson v. United States , 534 F.3d 958, 964 (8th Cir. 2008) (citation omitted); see also Land v. Dollar , 330 U.S. 731, 735 n.4, 67 S.Ct. 1009, 91 L.Ed. 1209 (1947) (noting "there is no statutory procedure upon an issue of jurisdiction, [and] the mode of its determination is left to the trial court" (citation omitted)).

B. Analysis

Extending beyond the Eleventh Amendment, Fed. Maritime Comm'n v. S. Carolina State Ports Auth. , 535 U.S. 743, 754, 122 S.Ct. 1864, 152 L.Ed.2d 962 (2002), the doctrine of sovereign immunity represents...