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Bowser v. Empyrean Services, LLC

United States District Court, W.D. Pennsylvania

March 30, 2018

JOHN BOWSER, Plaintiff,



         I. Introduction

         Presently before the Court is the motion for conditional certification filed by John Bowser (“Plaintiff”), pursuant to § 216(b) of the Fair Labor Standards Act, 29 U.S.C. §§ 201, et seq. (“FLSA”). (ECF No. 53). In the operative first amended complaint, Plaintiff asserts violations of the overtime provisions of the FLSA on behalf of himself, and all others similarly situated, against Empyrean Services, LLC (“Empyrean”), Guidant Group, Inc. (“Guidant”), and Duke Energy Corporation (“Duke) (collectively, “Defendants”). (Docket No. 33). This Court exercises subject-matter jurisdiction pursuant to 28 U.S.C. § 1331. After careful consideration of the motion, the memoranda of the parties, and the record, the Court will GRANT Plaintiff's motion.

         II. Procedural and Factual Background

         In his first amended complaint, Plaintiff claims that Duke utilized the services of Guidant and Empyrean to provide it with a pool of contingent workers, paid on an hourly basis, who worked in excess of forty hours per week without any overtime compensation required under the FLSA. (ECF No. 33 ¶¶ 9, 12, 15, 20, 21, 23, 25, 26). Defendants are alleged to have jointly hired, fired, supervised, set pay rates, set schedules, and approved time worked by Plaintiff and the other contingent workers. (Id. ¶ 10). They also kept detailed records of the hours worked by each contingent worker. (Id. ¶ 18).

         Guidant defines its relationship with Duke as that of a “managed services provider.” (ECF No. 54-1 at 6). This relationship began in 2003. (ECF No. 54-1 at 7). Guidant's agreement with Duke is to provide laborers on an hourly basis. (ECF No. 54-1 at 36). As a function of their working arrangement, Duke provides Guidant with office space in Duke facilities in North Carolina and Ohio. (ECF No. 54-1 at 7). Guidant uses equipment provided by Duke at some of these facilities. (ECF No. 54-1 at 7).

         For purposes of hiring contingent workers to perform various roles at Duke facilities, Guidant staff work with Duke's “hiring managers” to define the job duties and requirements for new hires. (ECF No. 54-1 at 9 - 10, 13). Guidant then liaises with various independent staffing agencies[1], and the staffing agencies provide candidates for openings. (ECF No. 54-1 at 11). Guidant characterizes its work with staffing agencies as a “collaborative effort.” (ECF No. 54-1 at 19).

         Guidant does an initial screening of the candidates, then passes the information along to Duke's hiring managers to make a final determination. (ECF No. 54-1 at 11 - 12, 18). Once Duke approves of a particular candidate or candidates, Guidant sends out a “job order” to the relevant staffing agencies. (ECF No. 54-1 at 12). Guidant is then responsible for ensuring that the new contingent workers receive necessary training from Duke staff. (ECF No. 54-1 at 32, 39).

         Workers must abide by Duke's policies, rules, and regulations. (ECF No. 54-1 at 45). Contingent workers use Duke's equipment, and wear Duke security badges. (ECF No. 54-1 at 46). Duke can require contingent workers to work overtime hours. (ECF No. 54-1 at 46 - 47). Guidant periodically follows up to check on Duke's level of satisfaction with the contingent workers. (ECF No. 54-1 at 23).

         Guidant requires each staffing agency to enter a form agreement; the form agreements are generally the same for each agency, with the exception of mark-up rates which differ from agency to agency. (ECF No. 54-1 at 34). By the terms of these agreements, staffing agencies must comply with the FLSA, and Guidant randomly audits twenty percent of all new hires to check compliance. (ECF No. 54-1 at 40 - 41). The results of these audits are reported to Duke. (ECF No. 54-1 at 40 - 41, 47).

         Staffing agencies are also obligated to ensure that all contingent workers are W-2 employees - not 1099 independent contractors. (ECF No. 54-1 at 42). Guidant expects that staffing agencies will pay contingent workers a salary. (ECF No. 54-1 at 52 - 53). However, it is left up to the staffing agencies to determine the terms of a chosen worker's employment. (ECF No. 54-1 at 13, 16). Guidant does not provide any instruction in this respect. (ECF No. 54-1 at 37). It does not check to make sure that contingent workers are guaranteed a set wage, even if the workers do not work a full forty-hour week. (ECF No. 54-1 at 55). It is expected that the staffing agency will eat any shortfall that results from less than forty hours of work being billed. (ECF No. 54-1 at 69 - 71). Duke and Guidant do not consider the contingent workers to be their employees. (ECF No. 54-1 at 20, 42, 73).

         Nonetheless, Duke or Guidant can have a contingent worker removed from Duke's facilities at any time. (ECF No. 54-1 at 24, 37 - 38). Duke provides the day-to-day supervision of a contingent worker, and can convert contingent workers into officially recognized Duke employees. (ECF No. 54-1 at 39). Staffing agencies cannot reassign a contingent worker to another company without Duke's prior consent. (ECF No. 54-1 at 38).

         Guidant keeps a record of its contingent workers' time entries. (ECF No. 54-1 at 21 - 23). Each worker logs his or her hours on a timekeeping database maintained by Guidant; time is allocated according to “cost codes” associated with certain types of work performed for Duke. (ECF No. 54-1 at 24). Duke's management approves these entries for each contingent worker, and may reject entries or require edits to be made. (ECF No. 54-1 at 24 - 25). Once time entries are approved by Duke, an invoice is generated and payment is made to Guidant and the staffing agencies. (ECF No. 54-1 at 25). Staffing agencies are paid for each hour of time approved by Duke, and take a percentage off the top for service fees and expenses. (ECF No. 54-1 at 46, 62). The same rate is paid by Duke for all hours billed. (ECF No. 54-1 at 68).

         If a contingent worker seeks a wage increase, the request is first made to his or her respective staffing agency, which passes the request on to Guidant. (ECF No. 54-1 at 27 - 28). If Guidant determines that such a request may be reasonable, it works with the staffing company on a proposal to present to Duke. (ECF No. 54-1 at 27 - 30). The decision to grant a request is within the sole discretion of Duke management. (ECF No. 54-1 at 30). Guidant, however, can deny a request on its own accord. (ECF No. 54-1 at ...

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