Defendant Cannot Disprove “Willfulness” In FLSA Class Action So Plaintiffs Get A Third Year: Should Never Happen!

Fox Rothschild LLP

Fox Rothschild LLP

When I, as a management-side practitioner, defend a FLSA class action, the contingency I fear is that a court might find that the violation was “willful,” thereby extending the two-year statute of limitations to a third year. A recent case shows just how hard a defendant will fight against that third year. In this case, the employer could not convince the Court that a third year was unwarranted. The case is entitled Bah v. Enterprise Holdings Inc. et al. and was filed in federal court in the District of Massachusetts.

The Company had relied upon a Second Circuit decision that concluded that in order to find willfulness, the plaintiff(s) had to plausibly support their claim. The Massachusetts (which is in the First Circuit) Judge disagreed, observing that the Second Circuit holding merely creates a circuit split on this issue” and “does not persuade the court that its Nov. 13, 2020, decision was based on a manifest error of law.”

The Company had sought reconsideration of the Judge’s November 2020 ruling, It argued that the employee commencing the action “never asserted a single factual allegation supporting his claim that defendants’ alleged misclassification somehow constituted willful neglect or disregard for compliance with the FLSA.” The reconsideration motion sought only to upset the willfulness ruling. The remainder of that November decision focused on whether the joint employer issue had been properly and adequately pled. Now, the case will proceed to a decision on conditional certification.

The Takeaway

To plaintiff side lawyers, everything is willful. They never saw a case that wasn’t willful. That simply is not case. Most FLSA violations, especially misclassification issues, I have found, are more attributable to good-faith employer errors when they make nuanced and fact-sensitive decisions on who is/is not exempt. Employers need to carefully document, in internal memos, for example, what bases and facts supported their decisions to classify employees. Naturally, those decisions need to be factual and legally well founded, but such a protocol goes a long way to defeating willfulness claims.

They shouldn’t get that third year…

[View source.]

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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