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Ferreras v. American Airlines, Inc.

United States Court of Appeals, Third Circuit

December 24, 2019

DANIEL FERRERAS; EDWIN GONZALEZ; DOUG BILLITZ; RUEBEN RAMIREZ; RAMON COCA;CHRISTOPHER FAUST; MASOUD ZABIHIALAM; SCOTT ELLENTUCK; DENIS LIPPENS, On Behalf of themselves and all others similarly situated
v.
AMERICAN AIRLINES, INC., Appellant

          Argued October 15, 2019

          On Appeal from the United States District Court for the District of New Jersey (D.C.No.2-16-cv-02427) District Judge: Hon. Jose L. Linares

          Jeffrey I. Kohn Anton Metlitsky [ARGUED] Mark W. Robertson O'Melveny & Myers, Jason Zarrow O'Melveny & Myers Counsel for Appellant

          Brett R. Gallaway Steven J. Hyman LeeS. Shalov [ARGUED] Wade C. Wilkinson McLaughlin & Stern Counsel for Appellees

          Adam G. Unikowsky Jenner & Block Counsel for Amicus Appellant

          Before: CHAGARES, JORDAN, and RESTREPO, Circuit Judges.

          OPINION

          JORDAN, CIRCUIT JUDGE.

         This case involves claims for overtime wages brought by employees of American Airlines, Inc. ("American"). The employees allege that American violated the New Jersey Wage and Hour Law ("NJWHL") because the airline's timekeeping system defaults to paying employees based on their work schedules, even if they work additional hours outside of their shifts and in excess of 40 hours per week.

         The employees brought their claims as a putative class action and moved for class certification. The District Court decided that all of the requirements for class certification, as set forth in Federal Rule of Civil Procedure 23, were met, and it thus certified the class. American appeals that order, arguing that the District Court did not conduct a rigorous analysis and that several of the requirements of Rule 23, including commonality and predominance, were not met. American argues that this case cannot proceed as a class action because determining when each employee was actually working will necessarily require individualized inquiries. We agree and will therefore reverse the order of the District Court.

         I. Background

         American's timekeeping system is programmed to calculate pay for employees only for the duration of their shifts, excluding an automatic deduction for a 30-minute meal break. If an employee clocks in before the employee's shift begins or clocks out after the shift ends, the timekeeping system defaults to assuming that the employee only worked during the shift, rather than working any extra time. American calls those pre-and post-shift clock-in time durations "grace periods." The grace periods allow employees to avoid having to clock in exactly when their shift begins or clock out exactly when their shift ends. Similarly, the timekeeping system's assumption that an employee takes a 30-minute meal break during a shift means that employees do not have to return to the time clock before and after each meal break.

         If employees actually do perform work during grace periods or meal breaks, American's policy requires them to identify for a supervisor the time they worked outside of their shift and ask for approval of that time as an "exception" to their ordinary work hours. Otherwise, they are not paid for the time worked outside of their shift.

         The class as certified includes all non-exempt, hourly employees at American's Newark Liberty International Airport ("Newark airport") station, who were employed at any time from April 29, 2014 through the present. The named plaintiffs are two fleet service employees and seven mechanics at that airport. Fleet service employees handle cargo, assist with lavatory services, and help maneuver aircrafts in and around hangars. Mechanics perform repairs and updates on airplanes. A third category of non-exempt hourly-paid employees included in the class is passenger service agents, who check passengers in and manage boarding at the gates. None of the named plaintiffs are passenger service agents.

         The plaintiffs complain that, in violation of the NJWHL, American did not pay its employees for all time worked because its timekeeping system defaults to paying employees based on their work schedules rather than on the time they actually spent working. The plaintiffs also allege that, although American purports to have procedures to compensate employees for unpaid time, management regularly refuses to pay employees for pre- and post-shift work and work done during meal breaks. The claims in the complaint focus on three periods of the workday: (1) ...


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