California Court Rejects Defense Arguments Against Collective Action for Alleged Violations of FLSA (Fair Labor Standards Act) but Agrees with Defense that Class Action is not Superior Device for Litigating State Employment Law Claims and Denies Class Action Status to Claims Based on California Labor Code, Over Which it had Supplemental Jurisdiction, as Inconsistent with “Opt-In” Requirements for FLSA Collective Action
Plaintiff, former Long Beach police officer, filed a putative class action against the City of Long Beach for alleged violations of the federal Fair Labor Standards Act (FLSA) and of California’s Labor Code sections 226.7, 512 and 2802 based on the allegations that he was denied meal and rest breaks and was not properly reimbursed for business expenses while a police officer. Edwards v. City of Long Beach, ___ F.R.D. ___ (C.D. Cal. December 15, 2006) [Slip Opn., at 2-3.] The thrust of the class action complaint asserted that while police officers kept track of, and received pay for, overtime hours worked, no policy or procedure existed for officers to record or report missed meal and rest periods. Id., at 2-3. Further, while officers were required to have clean and functional uniforms and equipment, the City did not reimburse class members for the costs incurred in maintaining those items. Id., at 3. Plaintiff filed two motions in the district court: one requested certification of the lawsuit as a class action under Rule 23, id., at 7, which defense attorneys opposed on the grounds that the numerosity, commonality and typicality requirements are not met, a class action will not benefit the class, and other alternatives exist rather than class action litigation, id., at 8; the second sought certification of a collective action under 29 U.S.C. § 216(b), id., at 1, which defense attorneys opposed by focusing on the differences in job duties between the plaintiff and other class members, id., at 6. The district court refused to certify a class action under Rule 23, but granted the motion to certify a collective “opt-in” action under § 216(b), id., at 1.
In granting the motion to certify a collective action (in essence an “opt-in” class action) under § 216(b) of the FLSA, the federal court explained that “employees wishing to join the suit must ‘opt-in’ by filing a written consent with the court” or else they are not bound by any judgment or settlement. Edwards, at 4. In a majority of jurisdictions, certifying such a collective action requires a two-step process: “the first step is for the court to decide, ‘based primarily on the pleadings and any affidavits submitted by the parties, whether the potential class should be given notice of the action,'” id., at 5 (citations omitted); the court found that the “lenient standard” required to overcome this hurdle had been met. Id., at 5-7. The second step in the process is a motion by defense attorneys to decertify the class action, id., at 7; but the district court explained that it does not address that issue until after the opt-in time period has passed, id. The court rejected defense arguments that a collective action was inappropriate because of the differences in job duties between the plaintiff and other class members, id., at 6, explaining that – even though the defense had presented a “detailed analysis” of those differences, together with a “detailed discussion” of the differences in claims that potential class members may assert – the defense arguments were “better suited for motion to decertify the § 216(b) collective action,” id., at 7.
In denying the motion to certify the lawsuit as a class action, the federal court focused only on Rule 23(b)(3): because the court held that the requirements of Rule 23(b)(3) had not been met, it found it unnecessary to address the requirements of Rule 23(a). Edwards, at 8 n.3. At bottom, the district court held that a collective action (an “opt-in” class action) was superior to a class action (requiring class members to “opt-out”). This was true for two reasons. First, the court agreed with defense attorneys that an “opt-in” collective action was superior to an “opt-out” class action, as it “‘allows individuals to control their participation in [the] litigation in a far more expeditious fashion than does a Rule 23 class action.'” Id., at 10 (citation omitted). Moreover, permitting both an opt-in collective action and an opt-out class action to proceed simultaneously would confuse class members. Id. Second, the court harbored serious jurisdictional concerns that would exist if it permitted an opt-out class action to proceed. Specifically, the opt-in collective action was governed by FLSA, and it was the FLSA claims that provided the court with jurisdiction in the matter. Id. However, the opt-out class action involved the state labor law claims, over which the court was exercising supplemental jurisdiction only. The possibility therefore existed that only a handful of people would opt-in under the FLSA, resulting in the prosecution of an action in which “state law claims would substantially predominate over the federal claims.” Id.¸ at 10-11 (citation omitted).
Finally, the court quoted with approval the decision of a sister court that “[T]he policy behind requiring FLSA plaintiffs to opt-in to the class would largely ‘be thwarted if a plaintiff were permitted to back door the shoehorning in of unnamed parties through the vehicle of calling upon similar state statutes that lack such an opt-in requirement.'” Id., at 11 (quoting Leuthold v. Destination America, Inc., 224 F.R.D. 462, 470 (N.D. Cal. 2004)). The thrust of this argument is that allowing an “opt-out” class action would thwart clear Congressional intent that these types of claims be maintained on an “opt-in” basis. Id. Accordingly, a collective action under § 216(b) was the superior, “more appropriate” means for resolving the dispute, rather than a class action under Rule 23. Id., at 11-12.
NOTE: The district court held that “Plaintiffs who opt-in to the § 216(b) collective action may pursue any pendent state law claims as part of the FLSA action.” Edwards, at 12.