Supreme Court Issues Opinion Reinstating Important Tool for Employers to Defeat FLSA Collective Actions

In a major victory for employers, the U.S. Supreme Court issued an opinion today confirming employers' ability to make an "offer of judgment" to named plaintiffs who are pursuing collective actions under the Fair Labor Standards Act (FLSA). 

In Genesis HealthCare Corp. v. Symczyk, U.S. No. 11-1059 (Apr. 16, 2013), the Court held that when an employer's offer of judgment pursuant to Federal Rule of Civil Procedure 68 fully satisfies the named plaintiff's FLSA claims, and no other plaintiffs have opted in, the claims become moot and the court must dismiss the entire lawsuit for lack of subject matter jurisdiction. 

Obviously, the ability to make an offer of judgment to named plaintiffs for the purpose of defeating a class action before it gains traction is a tremendous defensive tool for employers. Genesis HealthCare effectively overrules a recent decision from the Fifth Circuit Court of Appeals, which precluded the use of Rule 68 offers of judgment to "pick off" named plaintiffs early on in FLSA collective actions. See Sandoz v. Cingular Wireless, 553 F.3d 913 (5th Cir. 2008).

Topics:  Collective Actions, FLSA, Genesis HealthCare, Genesis Healthcare Corp. v. Symczyk, Rule 68, SCOTUS

Published In: Civil Procedure Updates, Constitutional Law Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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