Need For Too Much Individual Scrutiny Defense Fails: A Real Bummer!

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The employer who is fighting a collective or class action must make the argument that there is too much of a need for individual scrutiny to allow a class to proceed.  There are times that argument works, and times it does not.  An Illinois federal Judge has recently conditionally certified a class of logistics workers where the Judge rejected the employer’s contention there was too much dissimilarity.  The case is entitled Parker et al. v. IAS Logistics DFW LLC, and was filed in federal court in the Northern District of Illinois.

The Judge did, however, rule that only workers at one facility should be in the class as the workers in the trucking division should not be included because they were not similarly situated to the other employees.  The Company had contended that a class was inappropriate because it sought to include workers across many States, without regard for the positions they held, or their service sector, hours worked or compensation structure.  The Judge believed that the plaintiffs could meet the conditional certification tests without having to demonstrate the members of the class worked in the same positions.  As the Judge noted, the “plaintiffs can be similarly situated for purposes of the FLSA even though there are distinctions in their job titles, functions, or pay.”

The Judge also rejected the contention that conditional certification was inappropriate for those employees who were working under arbitration agreements. The Seventh Circuit recently held that employees with arbitration agreements and potentially join a collective action (i.e. receive the opt-in notice) unless the “defendant fighting notice proves that a valid arbitration agreement exists for each worker it seeks to exclude from receiving notice.”  In this case, the Judge observed that “not only do [Parker and Rhodes] allege that the arbitration agreements and waiver provisions were entered into with another entity, not Pinnacle, but Pinnacle also does not seek discovery on the agreements to establish their validity.”

The workers rely on a well-established “basis” or “theory” for their claims.  They contend that the Company violated the FLSA (and Illinois and Maryland law) by automatically deducting a half-hour to an hour from each shift for lunches, even if they allegedly worked during their meal periods.  The suit also claims the Company did not include shift differentials (e.g. nights, weekends) when computing the regular rate for overtime calculations.

The Takeaway

Well, at least they managed to exclude one facility from the calculus and that is a victory.  I always first look for a legal out, a magic bullet, such as to content the workers are all “exempt” or the case is preempted by a union contract, something that makes it all go away in one fell swoop.  If that option is not in the picture, then we (always) argue the individual scrutiny “angle.”

Sometimes the magic works, sometimes it doesn’t…

[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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