Roberts v. One Off Hosp. Grp.
| Decision Date | 06 July 2022 |
| Docket Number | 21 C 5868 |
| Parties | ALEXA ROBERTS, on behalf of herself and all others similarly situated, Plaintiff v. ONE OFF HOSPITALITY GROUP, LTD., PAUL KAHAN, DONNIE MADIA, and EDUARD SEITAN, Defendants. |
| Court | U.S. District Court — Northern District of Illinois |
Plaintiff Alexa Roberts alleges in this action that Defendants One Off Hospitality Group, Ltd., Paul Kahan, Donnie Madia, and Eduard Seitan (collectively “Defendants”) deprived her and others similarly situated of wages and overtime compensation to which they were entitled. Roberts claims that Defendants violated the Fair Labor Standards Act (“FLSA”), the Illinois Minimum Wage Law (“IMWL”) and the Illinois Wage Payment and Collection Act (“IWPCA”). Defendants move to dismiss all claims against Defendant One Off Hospitality, and to dismiss Robert's IWPCA claim against all Defendants. (Dkt. 24). For the reasons given, the Motion is granted in part and denied in part.
On a motion to dismiss under Rule 12(b)(6), the Court accepts the complaint's well-pleaded factual allegations, with all reasonable inferences drawn in the non-moving party's favor, but not its legal conclusions. See Smoke Shop, LLC v. United States, 761 F.3d 779, 785 (7th Cir. 2014). The following factual allegations are taken from Robert's First Amended Complaint (Dkt. 19) and are assumed true for purposes of this motion. W. Bend Mut. Ins. Co. v. Schumacher, 844 F.3d 670, 675 (7th Cir. 2016).
Defendant One Off Hospitality Group, Ltd. (“One Off”) owns and operates several Chicago-area restaurants, including Blackbird, Publican, Big Star, the Violet Hour, and Publican Quality Meats. One Off manages each of these restaurants including managing staffing, gift card sales, and online food sales. (¶¶13, 46-47). The restaurants owned by One Off often share employees, have common management, employee policies, and compensation practices. (¶48). Defendant Kahan is the executive chef and partner of One Off and was involved in the day-to-day management of the restaurants. Defendant Madia is a managing partner of One Off and was involved in day-to-day management of Roberts and other putative class members, including working on the floor of the restaurants. (¶15). Defendant Seitan is a managing partner of One Off and worked closely with Roberts and other putative class members to direct job tasks. (¶16). Each of the individual defendants, through their involvement in the management of the restaurants, was aware of the wage and hour violations that Roberts alleges. (¶¶13-17 49).
Roberts was employed as a bartender at Blackbird and Avec restaurants in Chicago from 2017 to July 2020. At the time she was hired, Defendants agreed that Roberts would be paid $11.00/hour, reduced with a tip credit. Over time, that rate increased to $13.50/hour reduced with a tip credit. (FAC ¶¶5-6). She regularly worked more than 40 hours a week. Her job duties included tasks that required her to work either before or after her scheduled shifts. (Id. ¶7). Roberts was instructed by Defendants to clock in and out at the times of her scheduled shift to avoid overtime, regardless of the time she actually worked. (¶¶8-9, 50-51). Defendants knew that their employees were performing off-the-clock work outside their scheduled hours and that those employees were not being paid for that work. (Id. ¶¶7-9). If Roberts did record her overtime work, she was reprimanded by Defendants for violating internal employment policies. The Defendants were aware that employees were working outside their scheduled shifts and the individual Defendants were often present when employees were working off the clock, and/or instructed the employees to do so. (¶52).
Roberts brought her initial complaint on November 2, 2021, and Defendants moved to dismiss. Roberts subsequently filed the operate First Amended Complaint (Dkt. 19). The First Amended Complaint alleges that Defendants violated the Fair Labor Standards Act (“FLSA”) (Count I), the Illinois Minimum Wage Law (“IMWL”) (Count II) and the Illinois Wage Payment and Collection Act (“IWPCA”) (Count III). Pursuant to Federal Rule of Civil Procedure 12(b)(6), Defendant One Off Hospitality moves to dismiss all claims brought against it, and Defendants collectively move to dismiss Count III.
“To survive a motion to dismiss under 12(b)(6), a complaint must ‘state a claim to relief that is plausible on its face.' ” Adams v. City of Indianapolis, 742 F.3d 720, 728 (7th Cir. 2014) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Adams, 742 F.3d at 728 (quoting Ashcroft v. Iqbal, 566 U.S. 662, 678 (2009)). “[I]t is not enough for a complaint to avoid foreclosing possible bases for relief; it must actually suggest that the plaintiff has a right to relief . . . by providing allegations that ‘raise a right to relief above the speculative level.'” E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 777 (7th Cir. 2007) (citing Twombly, 550 U.S. at 555) (emphasis in original). The Court construes the complaint “in the light most favorable to the nonmoving party, accept[s] well-pleaded facts as true, and draw[s] all inferences in [his] favor.” Reynolds v. CB Sports Bar, Inc., 623 F.3d 1143, 1146 (7th Cir. 2010). “[L]egal conclusions and conclusory allegations merely reciting the elements of the claim are not entitled to this presumption of truth.” McCauley v. City of Chicago, 671 F.3d 611, 616 (7th Cir. 2011) (citing Iqbal, 566 U.S. at 678).
The IWPCA provides employees with a cause of action against employers for the timely and complete payment of earned wages. 820 ILCS 115/3. The Act defines “wages” as “compensation owed an employee by an employer pursuant to an employment contract or agreement between the 2 parties....” 820 ILCS 115/2 (emphasis added). As such, “to state a claim under the IWPCA, the drivers are required to demonstrate that they are owed compensation from defendants pursuant to an employment agreement.” Enger v. Chicago Carriage Cab Corp., 812 F.3d 565, 568-69 (7th Cir. 2016); see also Brand v. Comcast Corp., 2013 WL 1499008 at *2 (N.D. Ill. Apr. 11, 2013) ( that “to state a claim under the IWPCA, [plaintiff] must allege that [defendant] owed him the unpaid wages pursuant to an employment contract or agreement”). Defendants argue that Count III should be dismissed because Roberts has failed to allege sufficient facts to show the existence of an “employment contract or agreement” required to bring an IWPCA claim.
The parties do not dispute that no written employment contract governs this claim. (Dkt. 25 at 5, Dkt. 26 at 4). The question then becomes whether Roberts has alleged the existence of an employment agreement. An agreement need not be express to state an IWPCA claim and can be “entirely implicit.” Chagoya v. City of Chicago, 992 F.3d 607, 625 (7th Cir. 2021); see also Landers-Scelfo v. Corp. Off. Sys., Inc., 356 Ill.App.3d 1060, 1067-68 (2005). However, it is “not enough to allege the existence of any employment contract or agreement: the [plaintiffs] must allege that existence of a contract or agreement that specifically gives [them] a right to the wages they seek.” Id.; see also Bruger v. Olero, Inc., 434 F.Supp.3d 647, 652 (N.D. Ill. 2020) (“Illinois courts have explained that the concept of an employment agreement under the IWPCA is ‘broader than a contract' and ‘requires only a manifestation of mutual assent.”) (internal citations omitted).
Defendants argue that Roberts is merely “invoking pre-existing statutory duties” that cannot form the basis of an agreement for purposes of IWPCA liability. This position finds footing in the concept that compliance with the law does not constitute consideration for the formation of a contract. See, e.g., Wharton v. Comcast Corp., 912 F.Supp.2d 655, 660 (N.D. Ill. 2012) () (citing Restatement (Second) of Contracts § 73). The court in Wharton noted that an agreement (as opposed to a contract) ). Defendants' argument “is more applicable to contracts because contracts require considerations, which usually means that parties cannot contract to do things that they were already required to do.” Snell-Jones v. Hertz Corp., 2020 WL 1233825 (N.D. Ill. Mar. 13, 2020) ()
Here while it may have been adequate, Roberts has done more than allege that the parties mutually assented to follow the law. She alleges that she was worked as a bartender at Blackbird and agreed with Defendants at the time she was hired that she would be paid $11.00 per hour worked, reduced with a tip credit. She regularly worked at least five days per week, including appropriately two double shifts per week, and regularly worked more than 40 hours per week. (FAC ¶¶5-6). As part of her job, she performed tasks like preparing mixers and fruits for drinks before her scheduled shift, and cleaning and closing tasks after her scheduled shifts. (FAC ¶7). These tasks were required for employees to complete. (FAC ¶¶50-52). Defendants agreed, at the time Roberts and other...
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