Wage and Hour Class Actions Can Still Be Certified, at Least in the Ninth Circuit and California

Several notable court decisions over the last few months have given rise to speculation that wage and hour class actions are likely to become more difficult to certify.  Joe Tilson and Jeremy Glenn discussed some of those cases here.

But over the last couple of weeks at least two appellate decisions seem to indicate that wage and hour class actions are alive and well, at least in the Ninth Circuit and California courts.

Last week the Ninth Circuit reversed a district court’s denial of class certification and remanded the case with directions to certify the class.  In Leyva v. Medline Industries, Inc., which can be viewed here, an employee challenged the employer’s time-rounding practices and also alleged that the employer failed to include nondiscretionary bonuses in the calculation of overtime pay rates.  The plaintiff sought to certify a class of 538 current and former employees.  But the district court denied class certification, concluding that individual questions predominated over common questions because damage calculations varied from individual to individual.  The Ninth Circuit reversed, holding that the need for individual damage determinations alone cannot defeat class certification, and that in denying class certification on that basis the district court abused its discretion.  In its opinion the Ninth Circuit interpreted the United States Supreme Court’s recent decision in Comcast v. Behrend as holding that a plaintiff seeking class certification need only show that damages attributable to the theory of liability in question can be calculated separately from damages attributable to other theories.  Some commentators had read Behrend as supporting the proposition that class certification is inappropriate where individual damage issues are present, but the Ninth Circuit’s narrower interpretation of Behrend could make class certification less difficult in that circuit.

Earlier, an appellate court in California reversed an order denying class certification, and remanded the case to the trial court with directions to certify the class.  In Bluford v. SafewayStores, Inc., which can be viewed here, truck drivers were paid based on a piece rate formula that took into account the number of miles driven, the time of day the trips were taken, and the locations where the trips began and ended; along with fixed rates for certain tasks and an hourly rate for other tasks and delays.  None of the applicable rates specifically included compensation for rest periods, but Safeway had the drivers sign time cards that acknowledged they were authorized and permitted to take rest breaks.  The trial court denied certification, but the appellate court reversed on the grounds that neither the piece rate, nor the fixed rate, nor the hourly rate specifically compensated drivers for rest periods, and that this fact created a common issue for determining liability.  Likewise, the court also reversed the trial court’s denial of certification to a meal period class on the ground that the company’s meal period policy (which was contained in a collective bargaining agreement) did not mention that drivers were allowed a second meal period for shifts exceeding ten hours.  The trial court had denied certification because there was evidence that some drivers were aware that they could take second meal periods, and did take them.  But the court of appeal held that despite such evidence, the company’s non-compliant policy supported class certification.

Together, these two cases show that wage and hour class actions remain viable, and employers should be vigilant about ensuring their pay practices fully comply with state and federal law.

Aaron Buckley – Paul, Plevin, Sullivan & Connaughton LLP – San Diego, CA

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