United States District Court, W.D. Pennsylvania
March 31, 2014
ANDREW CAMPBELL, for himself and all others similarly situated, Plaintiffs,
VICTORY SECURITY AGENCY, L.P., Defendant. DORA SCHWARTZ, for herself and all others similarly situated, Plaintiffs,
VICTORY SECURITY AGENCY, INC., Defendant.
HARK R. HORNAK, District Judge.
These actions are consolidated for pretrial proceedings and are brought under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 216 et seq. , against two companies, Victory Security, L.P. and Victory Security Inc. The lead Plaintiffs are security guards who perfonned work for each company at various times, and now claim that they were not properly credited for all hours they worked, and as a result, they were denied overtime compensation as required by the FLSA. Before the Court are their respective Motions for Conditional Certification and Authorization, (ECF No. 87 in 11-489; ECF No. 17 in 11-1267), for the issuance of Preliminary Motions have been fully briefed by all parties, are vigorously opposed by the respective Defendants, and are now ripe for disposition. For the reasons which follow, the Motion as to Victory Inc. will be granted on the terms set forth in this Memorandum Order because the Plaintiffs have rather easily met the bar set by the substantive rule of law for such conditional certification and preliminary notice. Disposition of the Motion as to Victory L.P. is a much closer call, but will likewise be granted.
The facts as to the general outline of the claims common to both cases are set forth in this Court's Opinion of September 28, 2012, ECF No. 70 in No. 11-489, reported at 2012 WL 4506566 (W.D. Pa. Sept. 28, 2012), and they will not be repeated at length. All parties to this action are represented by the same lawyers in each case, and they and the parties are well-familiar with the factual record. In the Schwartz Opinion,  this Court held that the Plaintiff Ms. Schwartz, had not provided sufficient factual support for such notice as to the Defendant Victory L.P. (notwithstanding the substantial record support she was able to provide as to Victory Inc. based on her work experience there). That Motion was denied, but without prejudice to its reassertion if and when further factual development and support was forthcoming. As explained in that Opinion, the problem was that compared to her work history with Victory, Inc., Ms. Schwartz's work experience at Victory L.P. was relatively sparse, arising from only three (3) assignments, and she had little or no personal knowledge of the work assignment and compensation issues as to any other employee working on a Victory L.P. assignment.
By the same token, the Court noted that she had plenty of first-hand knowledge about both her situation at Victory Inc. and that of others at that organization. Thus, this Court denied the Motion, but without prejudice to the Plaintiff taking another run at the issue, if she could advance sufficient evidentiary support as to the actual practices at Victory L.P. Thus, apparently as a result of that ruling, Plaintiff Campbell was added as a named Plaintiff in that action, further factual development of the record occurred, and the Motion was refiled in No. 11-489 as to Victory L.P. As to No. 11-1267, the Plaintiff has also filed a similar Motion based on the record now developed, and relying on factual support from both Ms. Schwartz and Mr. Campbell.
The Court set out the applicable legal standard in Schwartz , and more recently considered the standard applicable to the disposition of these Motions in Stallard v. Fifth Third Bank, et al. , 12-cv-1092 (the rules did not change in the interim), and issued a Memorandum Order allowing for Conditional Collective Action certification and notice to potential opt-in participants on December 12, 2013. In that Order, the Court noted:
In this Circuit, such conditional certification is governed by the two-tier approach set out in Symczyk v. Genesis HealthCare Corp. , 656 F.3d 189 (3d Cir. 2011), rev'd on other grounds, 133 S.Ct. 1532 (2013); see Zavala v. Wal-Alart Stores, Inc. , 691 F.3d 527, 536 (3d Cir. 2012). In applying that test, this Court is to determine preliminarily whether the employees enumerated in the Amended Complaint, ECF No.4, can be provisionally categorized as "similarly situated" to a named Plaintiff. Moore v. PNC Bank, N.A. , 2013 WL 2338251, at *2 (W.D. Pa. May 29, 2013) This showing is a "modest" one. See Hively v. Allis-Chalmers Energy, Inc. , 2013; WL 5936418, at *3 (W.D. Pa. Nov. 5, 2013). The Plaintiff must then show, by the production of some evidence that goes beyond speculation, that there is a factual nexus between the manner in which the employer/Defendant's challenged policy or policies applies to the named Plaintiff(s) and those asserted to be similarly situated. Id. Where, as here, there has been some discovery aimed at these matters, arguably an incrementally higher standard applies, but it is not so substantially greater as to convert the question before the Court to one involving a dispositive merits resolution of the issues at hand.
Id. , ECF No. 77 (footnote omitted); see also Hively v. Allis-Chalmers Energy, Inc. , No. 13-106, 2013 WL 5936418 (W.O. Pa. Nov. 5, 2013); Vargas v. General Nutrition Centers, Inc. , No. 10-867, 2012 WL 3544733 (W.O. Pa., Aug. 16, 2012).
Of particular note is the analysis employed by Judge Fischer in Hively , namely that at this stage of the proceedings, the focus is not on a determination of the merits of the claims or defenses, or the resolution of factual disputes, but only on whether the plaintiffs have made a "modest factual showing" that the proposed plaintiffs are similarly situated, demonstrated by "some evidence", "beyond mere speculation", of a factual nexus between how the Defendants' policies affected the Plaintiff(s) and how it affected others in the same boat. Id. at *3.
The core of the Plaintiffs' Motions for Conditional Certification/Preliminary Notice in these cases is that supervisors of both Victory L.P. and Victory Inc. issued directives to these security guard Plaintiffs to arrive for work before their scheduled start time to gamer a report from the guard that they were relieving, and to then, from time to time, stay after their scheduled shift's conclusion as necessary to cover for the relieving guard, and to make any necessary hand-off reports, all without accurately recording all time actually worked. They support their position with the testimony of Mr. Schwartz and Mr. Campbell that this was the practice that they were not only directed to follow, but in fact did follow, while employed by each of the Defendants. Schwartz at *1. Mr. Campbell and Ms. Schwartz testified that these conditions consistently applied as to the times that they were employed/assigned by Victory Inc., and in the case of both Ms. Schwartz and Mr. Campbell, that they in fact followed that practice when they worked under the auspices of Victory L.P.
The principal opposing arguments of both Defendants, who are represented by the same counsel in both actions, are along the following lines.
Defendants first contend that the record reveals that both Victory entities had written policies that required all employees to work only as scheduled, and to reflect on their timesheets all hours actually worked. It appears uncontested that this is what those policy documents do say, but that is not necessarily the issue under the FLSA, since a covered employer is obligated to "count" and then pay for (at the appropriate rate) all hours worked, even if such work is performed contrary to the employer's policy. Under the FLSA, an employer may not "suffer" work and not pay for it. See 29 C.F.R. §§ 785.11, 785.13.
In some measure, the whole point of the Plaintiffs' cases, as they plead them, is that no matter what the written policy says, the actual operational procedures, as defined by the expectations of the Plaintiffs' supervisors, was that Plaintiffs, and those in similar situations, were to ignore the rules and do as they were told. In the end, it may tum out that the Plaintiffs' situations were idiosyncratic to them, but now is not the time to make that call. That comes later in the process. Thus, while this "defense" may provide some shelter to the Defendants at the merits stage of the case, or may knock out one or more opt-in Plaintiffs if their individual facts demonstrate that they did not act contrary to the policies Defendants proffer and say were the actual "rules of the road" in real life, this argument is premature at this point.
The second defense erected by the Defendant Victory L.P. is that Campbell's deposition testimony was that while he acted contrary to the stated "Victory" policies when he was supposedly directed to do so by a Victory Inc. supervisor, Mr. Perry Hite, he (Campbell) admitted that he was never so directed by any supervisor on job sites that were staffed by guards working under the express auspices of Victory L.P. This argument has some facial merit, but not enough to preclude notice at this point. The issue here is that Campbell testified that he followed the same "work extra/don't write it down" approach on those Victory L.P. jobs, which could put Victory L.P. on the hook for such FLSA claims if they were aware of it and thereby "suffered" this work by Mr. Campbell. Recall that this was also Ms. Schwartz's testimony in Schwartz. Thus, neither Ms. Schwartz, nor Mr. Campbell, is necessarily a lone outlier. They have each testified under oath that while they were on Victory L.P. jobs, they did what they did while they were on Victory Inc. jobs, namely, worked as they understood they were expected to, and did not record all of their time worked. While two such witnesses is not exactly a groundswell, given the entire record before the Court, and the very modest showing required at this point, it is in the Court's estimation enough to move to the next step of the process.
This result is buttressed by the deposition and documentary record which reveals that employees such as the Plaintiffs here were routinely shuffled between the companies for assignments and work, and the record also reveals that the commonly-used employment policies for both entities provided that "Victory Security Agency is composed of two companies, Victory Security L.P., Victory Security Inc. under one umbrella". This is telling for several reasons. First, there is no party in this case denominated simply as "Victory Security Agency" as such, but the nomenclature chosen to describe this overall operation would support an inference that from both the Defendants' perspective and that of employees, they were operated under a common hub ("one umbrella") with ad hoc job assignments coming from one spoke or another of that "Victory" umbrella as the circumstances dictated. Further, it would also appear to allow an inference that would square with both Ms. Schwartz's and Mr. Campbell's testimony, namely that she and he legitimately followed the directives received from the supervisor of one company (Victory Inc.) when they worked under the sub-"umbrella" of either enterprise. Therefore, while the merits-related issue of how many guards actually followed the same practices as described by Ms. Schwartz and Mr. Campbell may well come into play at the next stage of the case, it is not dispositive of the issue now before the Court. More importantly, this argument gives the required weight to the testimony of Ms. Schwartz as to her personal and observed work practices, as explained by the Court in Schwartz .
Next up to the defense plate (as to both entities) is the argument that because Campbell is now a supervisor, he cannot serve as Plaintiff any longer in either case as to a class/collection of front-line guards. From the Court's perspective, now that his testimony has demonstrated that Ms. Schwartz's situation was not, on the record, unique, his current status does not conclude this issue in Defendants' favor, since Ms. Schwartz is no longer flying solo as to the evidentiary record flowing from her own jobsite experiences.
This is followed by the argument that Mr. Campbell has not proffered the testimony of any other guard who can buttress his allegations as to Victory L.P. or Victory Inc. First, this ignores this Court's conclusion in Schwartz that Ms. Schwartz appeared to have plenty of personal knowledge, testimonial evidence as to the actual work practices at Victory Inc., Schwartz at *5. As to the Defendants' arguments that there will be, of necessity, "highly individualized" inquiries obviating the propriety of conditional certification as to either entity, this too may well be belied by the ultimate number of opt-in Plaintiffs. Or, if as Defendants contend, even when considered together Ms. Schwartz and Mr. Campbell are the odd situations, that would minimize the risk of individual issues overtaking collective issues. In any event, if it turns out that there was in fact a common workplace practice of setting the expectation that no matter what the written policies stated, guards were to, and did, work "off the clock", it would seem to the Court that the "individualized" component of that issue would be the individual calculation of damages, rather than an individualized assessment of liability. Nonetheless, this is not the stage of the case for the resolution of that issue.
As to the other defenses raised as to the relief sought as to Victory Inc. they too, fail at this stage for similar reasons. The guts of those defenses is that if any employee was directed to report early/stay late, it was not backed up with disciplinary action or threats, was sporadic, and because of the involvement of different job sites and schedules, the case would be rife with individualized analyses. As to the first issue, as noted above, an employer may nonetheless be liable under the FLSA if it permits work to be done and then does not count it as hours worked under the applicable FLSA regulations, regardless of whether the failure to work "off the books" was enforced by a threat of discipline. Second, the allegedly limited volume of such work may well go to the merits of assessing ultimate liability, of the ultimate "commonality" of specific situations, or even the number of opt-in Plaintiffs, but does not at this stage direct the Court's analysis. Finally, at this stage, the Court is unable to conclude as a matter of law that the "individualized analyses" asserted by Victory Inc. would so outweigh the potential application of common operating practices so as to make collective action treatment legally impermissible. The Court may conclude that later, when and if there are more individual situations in the case to be considered, but it cannot so rule as a matter of law at this point.
As to the claims against Victory L.P., if considered alone, the claims advanced by Mr. Campbell would suffer from the same problems as to this entity as the Court identified in Schwartz as to Ms. Schwartz. Mr. Campbell testified that the directive that he received to work extra time before and after shifts came from Mr. Perry Hite, a Victory Inc. supervisor, in connection with his one (1) assignment to a project staffed by Victory Inc. at the Tanger Outlet stores. The balance of the job sites at which he worked were each being handled by Victory L.P., namely at Engle Well, Franklin Lakeview, Independent Field, and Talisman Energy. Mr. Campbell did not testify that he was directed by anyone labelled as being a supervisor from Victory L.P. to work extra, "off the books" at any such Victory L.P. location, nor did he testify that he observed others regularly and routinely doing so. His testimony does support the conclusion that he kept "doing what he was doing" based on what Mr. Hite directed when he (Mr. Campbell) was working at the Tanger Outlet location.
Here, as was the case with Ms. Schwartz in Schwartz , Mr. Campbell's testimony, if considered alone, is not the sort of record evidence which would allow for the conclusion that as to the proposed class in Victory L.P., Mr. Campbell is likely similarly situated to its members. But, and it is a big "but", the record advanced on this point demonstrates that just like Ms. Schwartz in Schwartz, Mr. Campbell can speak with some authority as to what he did while at Victory Inc., (which meshes with Ms. Schwartz's testified-to experiences at that entity). What is also clear now is that at this point, neither he nor Ms. Schwartz stands alone, given their parallel testimony as to their own experiences with Victory L.P. On top of this are the business records of the "Victory" entities, in which they are self-described as being part of one "umbrella", coupled with the documentary and testimonial record that employees shuffle back and forth between them. All of that is enough to clear the rather low bar in place at this point.
For each and all of the above stated reasons, the Plaintiffs' Motions for Conditional Collective Action Certification as to the classes asserted as to Victory Security, Inc. and Victory L.P. will be granted. The parties are to meet and confer promptly, and submit to the Court within thirty (30) days of the date of this Opinion and Order a joint status report on the issue of content and scope of notice, along with a proposed Order for entry by the Court. The status report shall also note any specific areas of disagreement between the parties, and shall state, succinctly, the respective positions of each party as to any disputed point. Should there be any points of dispute, the Court will convene a conference of counsel, and will resolve each such point of disagreement.