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LABOR & EMPLOYMENT LAW — 2/14/08

Class of store assistant managers found to be similarly situated

An employer motion to decertify a collective action for overtime filed by assistant store managers, on the basis that class members were not similarly situated was denied, where all the opt-ins held the same job title and worked under the same job description and supervision hierarchy, ruled a federal district court in Texas. In this instance, the plaintiffs provided significant evidence to support their claim that all of the opt-ins either worked off-the clock or had time shaved off of their hours by store managers when they attempted to record all of the hours they actually worked (Falcon v Starbucks Corp, SDTex, 155 LC ¶35,387).

A former assistant store manager filed a collective action claiming that his employer failed to pay him and other assistant managers overtime wages for all hours worked in excess of forty hours per work week. The class was conditionally certified and notice was sent to potential class members. Eventually, a group of 355 opt-ins located in 30 states formed the class. The employer sought to decertify the class on the basis that collective action treatment was inappropriate because the plaintiffs were not similarly situated, its defenses to plaintiffs' claims were individualized and litigating the claims in a single action would be unfair to the employer and unmanageable.

Although the opt-ins worked at different stores under the supervision of different individuals, the court observed that all assistant managers were reclassified as non-exempt, were scheduled to work no more than 40 hours per week, and were subject to the same pay provisions and performance reviews. Additionally, the assistant managers made a strong showing that the employer's general policy of requiring assistant managers to perform job duties that could not easily be completed within 40 hours, while strongly discouraging overtime, failing to increase labor budgets, and basing bonuses, in part, on labor hours created an environment that motivated managers to violate the FLSA.

Further, the fact that all of the class members were paid some overtime did not defeat a finding of similarly situated where all of the deposed opt-ins consistently claimed that they were not paid overtime for all of the hours they worked. Moreover, the plaintiffs presented significant evidence that the environment created by the employer's policies appeared to have led to a pattern of off-the-clock work and time shaving.

For more information on this and other topics, consult CCH Employment Practices Guide or CCH Labor Relations.

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