Plaintiffs' counsel frequently speak of the "low" burden necessary at first stage for conditional certification under the FLSA. However, a recent decision from the Eastern District of New York highlights that plaintiffs may win the battle over conditional certification but still lose the war for final certification at second stage.
In Mendez v. U.S. Nonwovens Corp., the plaintiffs succeeded in obtaining conditional certification based on their claim that the defendants enforced several "policies" that adversely affected employees' wages, including failure to timely pay, failure to pay employees based on timecard punches, and requiring pre-shift work without additional compensation. At the close of discovery, they moved for class certification under Rule 23, which the court denied except as to a subclass of employees who claimed they were entitled to spread of hours pay under the New York Labor Law.
The defendants concurrently moved for decertification of the FLSA collective action. Magistrate Judge Steve I. Locke granted the motion. He noted the "heightened scrutiny" that must be applied at second stage certification, in contrast to the "modest factual showing" of similarity at the first stage. While the Second Circuit has not yet set forth a particular method for deciding second stage certification, Judge Locke noted that district courts generally look at the following factors: (1) disparate factual and employment settings of individual plaintiffs; (2) defenses available to defendants which appear to be individual to each plaintiff; and (3) fairness and procedural considerations.
Because Judge Locke found that the defendants' policies were not facially unlawful, he required the plaintiffs to provide sufficient evidence that the defendants' implementation of these policies violate the FLSA. Based on a review of the evidence, he found "no generalized or representative proof of such a policy that would establish liability on a collective-wide basis."
While the court said that each plaintiff may have a claim to unpaid overtime, "those claims may only be established through individualized evidence" given their varied experiences. He also noted that "anecdotal evidence of individual failures" in paying certain employees does not constitute "proof of a company-wide policy or practice." And given the disparate factual claims of liability, the defenses would "necessarily vary" on a plaintiff-by-plaintiff basis as well.
Mendez is yet another reminder that all is not lost when FLSA conditional certification is granted. Where there is compelling evidence that a trial would require individualized factual determinations and an assessment of individual defenses, employers can and should return to the judge to highlight those distinctions among the opt-in plaintiffs in an effort to reverse their fortunes without the yoke of the "lenient standard" of stage one.
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