Mastodon KJK scores huge victory in wage and hour class action lawsuit

Thursday, September 29, 2011

KJK scores huge victory in wage and hour class action lawsuit

Class certification is the seminal moment in wage and hour cases. The decision to certify a class will determine whether the case has the potential to be bet-the-company litigation, or merely litigation with a few discontented employees. Wal-Mart v. Dukes significantly altered the rules by appropriately shifting the focus in class actions to the existence (or lack thereof) of individual issues that distinguish and separate class members from each other. Even before the Supreme Court decided Dukes, however, courts were tuned-in to this issue. For example, consider Mickle v. Wellman Products, LLC, in which we scored a tremendous victory for our client by winning the reversal of the trial court’s class certification.

The plaintiffs in Mickle, four ex-employees, sought the certification of a class of employees for alleged unpaid wages. The issue: unpaid “gap time”—the time between when the employees clocked in/out and started/ended their work days.

To avoid any editorialization of my own case, I’m turning over the remainder of this post to the words of the Oklahoma Court of Appeals.

The Court described the challenged pay practice:

The hand scanned times are subject to “ETime Punch Rounding.” Under the rounding system, if an employee scans in prior to the start time of his or her shift, the employee’s start time is rounded to the beginning of the shift. If an employee scans after the start of his or her shift time, the rounding defaults the employee’s start time to the next quarter hour increment. At the end of the shift, if an employee scans out early, the employee’s end time is rounded to the prior quarter hour increment. If an employee scans out late, after the end of his or her shift, the employee’s end time is rounded the prior quarter hour increment.

The hand scanned times are not the sole method used by Wellman to determine payroll. Before an employee’s time is submitted to payroll, each employee’s default rounded ETime is reviewed and manually edited by a Lead to reflect the time an employee actually worked. The evidence submitted by Wellman demonstrated the Leads sometimes manually rounded punch time to the benefit of an employee. The ETime records are then submitted to payroll for editing and for use in creating weekly pay.

The plaintiffs alleged:

ETime always rounded in Wellman’s favor and the times recorded by the hand scanner and the rounding system provided common proof of all hourly employees’ uncompensated work during the time period between the hand scan and the shift buzzer.

The company argued:

[C]ertain proposed class members may not have performed work-related activities during the gap period. At the hearing, several employees … testified that during the gap periods, they may socialize with other employees, eat a meal in the break room, wash their hands, shower and change clothes, smoke cigarettes, or read the newspaper. These employees also testified that ten minutes before the buzzer sounded at the end of their shift, they would clean-up their work site in preparation for the next shift. The time record evidence shows routine individual adjustment of pay time both ways for a variety of reasons, pursuant to the gap period policy.

The Court held:

[T]he common issue of an allegedly flawed time-keeping method is “swamped by individual factual inquiries into the activities of each employee during the gap periods.” … Because Wellman did not exclusively rely on the hand scanned times and the ETime punch rounding method to determine payroll and each claim for unpaid overtime work must be examined to determine if such work was authorized, we hold individualized proof concerning each hourly employee’s activities during the gap period is indispensable to each employee’s claim….

[W]e conclude issues as to whether each employee was engaged in work or non-work activities during the gap period are too individualized to warrant class treatment for all hourly employees….

The full opinion of the Oklahoma Court of Appeals, which the Oklahoma Supreme Court has declined to review, is available for download from the National Chamber Litigation Center.