Velasquez v. Wca Mgmt. Co.
| Decision Date | 23 August 2016 |
| Docket Number | CIVIL ACTION NO. 4:15-CV-02329 |
| Parties | JOSE VELASQUEZ, et al, Plaintiffs, v. WCA MANAGEMENT COMPANY, L.P., Defendant. |
| Court | U.S. District Court — Southern District of Texas |
Pending in the above-referenced cause are Jose Velasquez ("Velasquez") and Jose Ortiz's ("Ortiz") (collectively, "Plaintiffs") Motion for Class Certification ("Motion for Class Certification") (Doc. 11), Plaintiffs' Motion to Extend Deadlines ("Motion to Extend") (Doc. 60), Plaintiffs' Motion for Leave to Amend Pleadings and Add New Parties ("Motion to Amend") (Doc. 63), and Defendant WCA Management Company's ("WCA") Motion for Summary Judgment and Alternative Motion to Dismiss Claims of Certain Opt-Ins ("Motion for Summary Judgment") (Doc. 64). Having considered the motions, responses, relevant law, and for the reasons set forth below, the Court is of the opinion that Plaintiffs' Motion for Class Certification and Motion to Amend should be granted and Defendant's Motion for Summary Judgment should be denied. Plaintiffs' Motion to Extend is now moot.
Plaintiffs Velasquez and Ortiz are former employees of WCA, a Houston-based, non-hazardous solid waste management company where they were employed as drivers. (Docs. 1 at ¶¶ 1-2, 6, 11-2 at 1-6.) Plaintiffs claim that WCA paid them a fixed daily rate for "on-the-clock" time, but failed to properly calculate their regular rate and failed to accurately record and report the hourly pay rates on their payroll records. (Doc. 1 at ¶ 17-19.) Instead, when they worked more than 40 hours in a week, Plaintiffs allege that WCA manipulated records to make it appear that Plaintiffs were being paid overtime when they were not. (Id.)
Seeking to recover those lost wages, in August 2015, Velasquez and Ortiz filed this lawsuit against WCA, alleging violations of the Fair Labor Standards Act, 29 U.S.C. §§ 201-219. (Id.) Plaintiffs brought their claims on behalf of themselves and all others similarly situated and identified their proposed class as all persons who had worked for WCA in the preceding three years and were not paid overtime.1 (Id. at ¶ 34.) Within a month of filing their complaint, four other individuals filed notices of consent to join their collective action and Plaintiffs filed their Motion for Class Certification.2 (Docs. 4, 6-8, 11.) Over the next six months, eighteen other individuals filed their notices of consent.3 (Docs. 21-28, 43, 45, 47, 49, 51, 53, 55, 58, 61.)
On January 13, 2016, a Scheduling Order was entered in the case, designating March 30, 2016, as the deadline for motions to amend and add new parties. (Doc. 32.) With the amendment deadline approaching, and with their Motion for Class Certification still pending, on March 15, 2016, Plaintiffs filed their Motion to Extend, seeking a 60-day extension of the amendment deadline. (Doc. 60 at ¶ 4.) On March 30, 2016, however, Plaintiffs filed their Motion for Leaveto Amend, seeking to add as party plaintiffs the twenty-two individuals who filed notices of consent, thereby mooting their earlier extension request. (Doc. 63.) Defendant opposes Plaintiffs' motions (Docs. 13, 16, 65) and recently filed its Motion for Summary Judgment (Doc. 64), which Plaintiffs oppose (Doc. 67, 70). All of the parties' motions are now ripe for adjudication.
In their Motion for Class Certification, Plaintiffs request that the Court conditionally certify the following class: "All individuals, who at any point, during the past three years prior to the filing of this lawsuit, worked for Defendant as drivers or driver's helpers4 and who did not receive overtime pay."5 (Doc. 11 at 7.) In asserting that certification is appropriate, Plaintiffs argue that all drivers were paid according to the same illegal pay scheme.6 (Doc. 15 at 2.)
In response, WCA first argues that Plaintiffs' claims are "conclusory, factually unsupported," and that "[c]ontrary to Plaintiffs' assertion, the undisputed evidence establishes they were properly paid for all of their overtime hours as required by the FLSA." (Doc. 13 at 4.)According to WCA, because Plaintiffs "have advanced no evidence that the Defendant improperly calculated the 'regular rate of pay' so as to deprive them of the proper amount of pay required by the FLSA," the "evidence does not support certification." (Id. at 7.) WCA further argues that because the initial plaintiffs were not employed by WCA when the collective bargaining agreement ("CBA") took effect,7 "none of the employees who are or have been covered by the terms of the CBA are 'similarly situated' to Plaintiffs" and should, therefore, not be covered under any certified class. (Id. at 4.)
One of the FLSA's objectives is to regulate overtime-pay requirements. See 29 U.S.C. §§ 202, 207. To this end, section 207(a) of the FLSA requires that covered employers compensate their nonexempt employees at overtime rates for time worked in excess of forty hours in a work week. Id. § 207(a).8 Section 216(b) of the FLSA creates a cause of action for employees againstemployers who are alleged to have violated one of the provisions of the FLSA. 29 U.S.C. § 216(b). Section 216(b) provides:
In light of this language, the Fifth Circuit has distinguished a section 216(b) action from a Rule 23 class action, noting that unlike a class action's opt-out procedure, 216(b) establishes an opt-in scheme under which plaintiffs must affirmatively notify the court of their intention to become parties to the suit. Mooney v. Aramco Servs. Co., 54 F.3d 1207, 1212 (5th Cir. 1995), overruled on other grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90 (2003). District courts have the discretion to implement 216(b)'s opt-in procedure by facilitating notice to potential plaintiffs. McKnight v. D. Hous., Inc., 756 F. Supp. 2d 794, 800 (S.D. Tex. 2010) (citing Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 170 (1989)). Such "notice should be 'timely, accurate, and informative.'" Villatoro v. Kim Son Rest., L.P., 286 F. Supp. 2d 807, 809 (S.D. Tex. 2003) (quoting Hoffman-La Roche, 493 U.S. at 172).
Courts recognize two methods to determine whether to authorize notice to similarly situated employees advising them of their right to join a FLSA collective action: (1) the two-step Lusardi approach, and (2) the class action-based Shushan approach. McKnight, 756 F. Supp. 2d at 800 (citing Lusardi v. Xerox Corp., 118 F.R.D. 351 (D.N.J. 1987); Shushan v. Univ. of Colo. at Boulder, 132 F.R.D. 263 (D. Colo. 1990)). The Fifth Circuit has not determined which method is more appropriate. Mooney, 54 F.3d at 1216. However, most courts, including in this district, use the Lusardi approach. Heeg v. Adams Harris, Inc., 907 F. Supp. 2d 856, 860-61 (S.D. Tex. 2012) (citations omitted); McKnight, 756 F. Supp. 2d at 800-01 (collecting cases).
The Lusardi approach has two steps: the "notice stage" and the "decertification stage." Mooney, 54 F.3d at 1213. At the notice stage, the district court "determines whether the putative class members' claims are sufficiently similar to merit sending notice of the action to possible members of the class." Acevedo v. Allsup's Convenience Stores, Inc., 600 F.3d 516, 519 (5th Cir. 2010) (per curiam) (citing Mooney, 54 F.3d at 1213-14). Because discovery is not usually complete at this point, "the court has minimal evidence." Mooney, 54 F.3d at 1214. Accordingly, the court makes this determination using a fairly lenient standard, and it typically results in "conditional certification" of the representative class. Id. If the court finds that the putative class members were similarly situated under this analysis, then conditional certification is warranted and the plaintiff is given the opportunity to send notice to potential class members. Id.
Once plaintiffs have opted in and discovery is complete, the court and defendant have more information on the case. Id. At this point, the defendant may file a decertification motion—triggering the second stage of the Lusardi approach. Id. At this step, the court makes a final determination as to whether the class members are similarly situated, allowing the representative action to proceed to trial or decertifying the class. Id. If the class is decertified, the opt-inplaintiffs are dismissed without prejudice while the original plaintiffs proceed to trial on their individual claims. Id.
The present case is at the "notice stage" of the Lusardi analysis. Because the standard at this stage is lenient, a plaintiff need only make a minimal showing to guide the court's determination whether to issue notice to potential class members. Id. This lenient standard requires only "substantial allegations that the putative class members were together the victims of a single decision, policy, or plan." Id. at 1214 n.8 (internal citation and quotation marks omitted). "Generally, to meet this burden, a plaintiff must show (1) there is a reasonable basis for crediting the assertion that aggrieved individuals exist; (2) those aggrieved individuals are similarly situated to the plaintiff in relevant respects given the claims and defenses asserted; and (3) those individuals want to opt in to the lawsuit." Vasquez v. Am. Bor-Trench, Inc., 4:12-CV-3181, 2014 WL 297414, at *3 (S.D. Tex. Jan. 23, 2014) (internal citations and quotation marks omitted). In evaluating these elements, courts consider factors such as whether potential plaintiffs were identified, whether affidavits of potential plaintiffs were submitted, and whether evidence of a widespread discriminatory plan was submitted. Velazquez v....
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