Seyfarth Synopsis: Advancing the trend of courts unwilling to rubber stamp the conditional certification of FLSA collective actions, Publix developed an early record of evidence that—when properly scrutinized—warranted the denial of collective certification in a case brought by five alleged representative plaintiffs claiming that they and thousands of others worked off-the-clock in violation of policies expressly prohibiting it. This hallmark case in the Eleventh Circuit—seen by some as the birthplace of the two-stage collective certification standard—provides a roadmap for defending FLSA litigation that long has over-burdened courts and employers. Roberts et al. v. Publix Super Markets, Inc., Case No. 8:23-cv-2447 WFJ-CPT, 2024 WL 4753703 (M.D. Fla. Nov. 12, 2024).
How did Publix convince the Middle District of Florida that five Named Plaintiffs were not similarly situated to opt-in plaintiffs and potential plaintiffs, thus defeating conditional certification and repudiating the plaintiffs' lawyers attempts to use the prospect of defending a massive FLSA collective action to bludgeon the employer into settling despite the merits? Publix's willingness to push for early and aggressive discovery ultimately proved critical to its success.
Publix's Push for Early Discovery Set the Course for Success
The Publix plaintiffs, non-exempt hourly Department and Assistant Department Managers, alleged that they performed four types of off-the-clock work: (1) pre-shift work; (2) post-shift work; (3) work performed during meal breaks; and (4) after hours work-related communications, such as e-mails and texts. The Company denied that any such off-the-clock work occurred and also denied that the Company knew about it, if it did in fact occur. The question at this stage of the case, however, was not whether the work occurred or whether Publix was liable for it, but rather, whether potentially thousands of other individuals were similarly situated to the Named Plaintiffs.
The case arose against the backdrop we've described recently of courts rejecting the "lenient" two-part Lusardi FLSA conditional certification standard in favor of more rigorous tests of whether plaintiffs are "similarly situated" to potential opt-in plaintiffs. The Lusardi approach, so named for Lusardi v. Xerox Corp. (D.N.J. 1987), applies a first stage "lenient standard" under which a plaintiff need make only a "modest showing" to convince a court to approve notice of the lawsuit to potential plaintiffs, with a more stringent standard applied at the second stage, after discovery.
Courts have moved away from this approach in recent years. In 2021, the Fifth Circuit's Swales opinion rejected Lusardi and concluded that plaintiffs must show that potential plaintiffs are "actually similar" to named plaintiffs, upon a "rigorous" analysis based upon discovery. Then, in 2023, the Sixth Circuit's Clark opinion rejected Lusardi's lenient first stage approach and concluded plaintiffs must demonstrate a "strong likelihood" that they are similarly situated to potential collective members to justify court-authorized notice, akin to the requirement for a preliminary injunction. The Sixth Circuit explained that at the second stage, a district court must make a conclusive determination as to whether plaintiffs and opt-in plaintiffs are "in fact similarly situated." The Seventh Circuit currently is considering whether to abandon the two-stage approach this term in Richards v. Eli-Lilly.
Because the Publix case is in the Eleventh Circuit, the court was not required to follow either of the newer approaches. Courts and employers in the Eleventh Circuit, however, have grappled with the outcome in Morgan v. Family Dollar, where the appellate court upheld the trial court's conditional certification and the denial of decertification of a retail store manager collective action. Plaintiffs' lawyers resoundingly argue that Morgan mandates use of the lenient standard for collective certification, though it's worth noting that the trial court in that case actually allowed early discovery to inform its decision on conditional certification—it just found that the evidence in that exemption misclassification case, among other unifying factors, justified certification.
Publix was not dissuaded and refused to assume the Lusardi "lenient" standard would apply or that Morgan required certification here. Instead, convinced that the actual facts and evidence would never support the plaintiffs' outlandish and vague claims that they worked without proper pay, Publix fought strategically to obtain discovery early in the case, and based on that discovery, enabled the court to apply a "more rigorous standard." Publix pushed for pre-certification discovery, which the court granted. Publix deposed eight of the 100 plaintiffs and relied heavily on differences in Plaintiffs' claims and work experiences that were uncovered in those depositions and the exchange of documents. Because of this pre-certification discovery, the court performed a more searching review of whether plaintiffs and the proposed collective were, in fact, similarly situated. The court applied a higher standard than the "lenient" first stage standard, and reviewed and relied on an abundance of record evidence reflecting differences in Plaintiffs' claims and experiences, described below.
Extensive Individual Inquiries Precluded Collective Certification
Now—based on a record of actual evidence rather than only the plaintiffs' self-serving complaint allegations and affidavits that courts might typically consider—the court scrutinized the claims against Publix and found that their veracity could not be determined in a unified, collective way. Whether untrue, unfounded, or simply outlandish, testing of each would require individualized inquiries antithetical to the purposes of collective action litigation. The court concluded:
- The pre-certification depositions revealed that "whether a given [Department/Assistant Manager] even worked off-the-clock, how long it took to complete such work, whether a supervisor ordered the additional work (or an employee was simply being proactive), and what type of work the employee completed are all questions whose answers varied from Plaintiff to Plaintiff."
- There were individual variances about whether Publix knew about off-the-clock work allegedly performed.
- There could be "substantial variance in the time it takes to complete off-the-clock work between each Plaintiff. For example, instances of alleged overtime work would only take a de minimis amount for a plaintiff."
- The alleged types of off-the-clock work were so various that individual inquiries would overrun anything commonly attributable to them.
- Publix's written policy prohibiting off-the-clock communications meant that any determination of liability would require individualized inquiries such as determining whether a text message, for instance, was work related or personal and how long it took to read and respond, if indeed it might represent non-de minimis working time.
In response to Plaintiffs' argument that the court should not consider these differences until a later merits stage of the case, the court explained that refusing to review and consider the discovery "would potentially result in the court granting Plaintiffs' motion for conditional certification despite already possessing evidence which would require it to grant a motion for decertification."
For example, the court refused to ignore evidence that Publix maintained facially lawful wage and hour policies, including policies requiring reporting of all off-the-clock work, and that Publix enforced those polices. The court explained that pre-notice discovery showed that "Publix's policies prohibiting off-the-clock work are not merely 'paper tigers,'" and that it "has fully paid employees for working overtime and terminated employees for repeated violations" of those policies. In sum, the court ruled there was no "policy or practice that violates the FLSA which is sufficiently clear to bind together a potential class this massive, this disparate, and this individualized."
The decision demonstrates, through extensive citations to the record, why the facts matter and why courts should not rush to certify collective actions without first considering the factual differences among potential collective members.
Lesson for Plaintiffs' Counsel? Publicity Efforts Led to Confused Employees
In an apparent attempt to bolster Plaintiffs' collective claims, Plaintiffs' counsel Shavitz Law Group and Morgan & Morgan embarked on a publicity campaign to entice employees to join the case as opt-in plaintiffs, and 97 employees joined the Named Plaintiffs. Those opt ins, including at least a few who had their depositions taken by Publix's counsel, may now be dismissed by the court and left wondering why they were encouraged to join. Those employees may feel they were misled into believing they had valid claims and thus settlement dollars heading their way. This is important because huge FLSA collective actions are often filed against well-intentioned employers who, like Publix, generally are viewed favorably by their employees and the community in general. From the employer's perspective, those employees likely did not understand what they were signing up for.
More Great News for Employers: Labor Budgets Do Not Violate The FLSA
In FLSA cases, plaintiffs' attorneys often argue that employers act improperly when they use labor budgets to manage payroll and overtime of non-exempt employees and set performance expectations for those same employees. This decision rejects that view. Plaintiffs alleged that Publix uses "labor forecasts" to determine the labor needs of each store, allowing Publix to assign hours "based on the specific items sold within particular stores (and their departments), venues and services offered, and the layout of each particular store," including hours for the assistant manager positions at issue. Plaintiffs contended that the work of assistant managers could not be completed within the hours allocated, thus compelling employees to work off the clock, and that there were "negative pressures" from supervisors and upper management, including being listed on an overtime report, that created a de facto policy to not report overtime hours.
The court rejected these arguments, explaining that the evidence reflected that Publix pays Department/Assistant Managers who report working overtime. In other words, labor budgets do not establish liability absent some evidence that the employer does not pay non-exempt employees who work overtime beyond the allocated hours.
What Did Publix Do Differently and What are the Lessons for Employers?
Lawyers filing putative FLSA collective actions against compliance-oriented employers nationally almost always argue that courts should, until far later in this expensive-to-defend litigation, disregard actual evidence of legal compliance or proof showing that plaintiff-employees were lawfully paid. Rather, they argue, courts should allow hundreds or thousands of employees to be notified that they might have claims against their employer, even when it is unlikely they actually will. This cart-before-the-horse approach to collective action litigation permits these lawyers to assert massive pressure on the employers they sue, based on the reality that the defense of these cases can cause exorbitant expenses—time, money, and other burdens. Publix—with its longstanding commitment to pay employees lawfully and competitively (something shown by numerous awards and recognitions for its investment in its talented workforce)—chose to stand up to the pressure and to fight for an opportunity to let the facts, rather than mere allegations, speak for themselves. It secured a win where other employers have struggled because it employed an aggressive strategy to fight back against an unjustified attack on its interests.
The court's decision in this case reminds us that employers can defend against FLSA collective actions by having sound wage-hour policies, enforcing those policies, and affirmatively pushing for early pre-certification discovery to highlight individualized inquiries rather than waiting to oppose a motion for conditional certification.
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