SHEFFIELD v. ORIUS CORP., (D.Or. 2002)

ANCER L. HAGGERTY, United States District Judge

On July 19, 2002, plaintiffs moved to certify a collective action under § 216(b) of the Fair Labor Standards Act (FLSA). See 29 U.S.C. § 216(b). On September 13, 2002, Magistrate Judge Ashmanskas filed his Findings and Recommendation that plaintiffs' motion to certify a collective action should be denied. The matter is now before the court pursuant to 28 U.S.C. § 636(b)(1)(B) and Fed.R.Civ.P. 72(b). A decision to certify a class is considered a "dispositive motion" for purposes of Rule 72. See Cornilles v. Regal Cinemas, Inc., 2000 WL 1364236 (D. Or. 2000); Caranci v. Blue Cross Blue Shield of Rhode Island, 194 F.R.D. 27, 31 (D.R.I. 2000); Harper-Wyman Co. v. Connecticut General Life Insurance Co., 1991 WL 18467 (N.D. Ill. 1999). The court therefore reviews the Magistrate Judge's decision de novo and for the reasons stated below, adopts the Magistrate Judge's Findings and Recommendation. Plaintiffs' motion to certify a collective action under 29 U.S.C. § 216(b) is denied.

The facts and subject matter of this case are described in the Findings and Recommendation and need not be repeated at length. Plaintiffs are former and current employees of defendant Orius Corp. and its subsidiaries and affiliates. They allege that defendant exercised a policy and practice of failing to pay overtime and compensating workers at rates below the federal minimum wage.

Plaintiffs' first claim under 29 U.S.C. § 216 seeks relief for employees of defendant who worked in excess of 40 hours per week and were not paid at a rate of 1 1/2 times their regular rate of pay for those hours worked in excess of 40 hours per week. Plaintiffs' second claim under 29 U.S.C. § 206 seeks relief for employees of defendant who were compensated at a rate below the federal minium wage.

Section 216(b) of the Fair Labor Standards Act sets forth two core requirements for certifying a collective action. Members of the putative class must be "similarly situated" and must provide "consent in writing . . . in the court in which such action is brought." 29 U.S.C. § 216(b).

Much judicial attention has been paid to whether Rule 23 factors such as numerosity, typicality, commonality, and adequacy are applicable to § 216(b) actions. The majority of courts have concluded that Rule 23 factors are inapplicable to § 216(b) actions. See, e.g., Kinney Shoe Corp. v. Vorhes, 564 F.2d 859, 862 (9th Cir. 1977), rev'd on other grounds, Hoffmann-La Roche, Inc. v. Sperling, 493 U.S. 165 (1989); Daggett v. Blind Enterprises of Oregon et al., 1996 U.S. Dist. LEXIS 22465, at * 14 (D. Or. 1996) (declining to apply Rule 23 factors to a § 216(b) collective action); Bayles v. American Med. Response of Colorado, Inc., 950 F. Supp. 1053, 1067 (D. Cob. 1996) (concluding that Rule 23 cannot "be engrafted onto § 216(b) suits"); Mete v. New York State Office of Mental Retardation Developmental Disabilities, 1993 WL 226434, at *2 (N.D.N.Y. 1993).

The standard for certifying a collective action under 29 U.S.C. § 216(b) is less stringent than the standard for certification under Rule 23. Daggett, 1996 U.S. Dist. LEXIS 22465, at * 17 (noting that the standard for certification of a FLSA collective action "is much less stringent than the FRCP 23 standard").

In determining whether or not to certify a collective action, the core inquiry is whether the putative class members are "similarly situated." 29 U.S.C. § 216(b). This court considers the term "similarly situated" in light of the purposes and goals of a collective action. The Supreme Court has recognized that class actions can be an efficient mechanism for resolving a number of disputes in one consolidated action. See Hoffman-LaRouch, 493 U.S. at 170; see also Daggett, 1996 U.S. Dist. LEXIS 22465, at * 17. However, an action dominated by issues particular to individual plaintiffs can not be administered efficiently because individual issues predominate over collective concerns.

Putative class members must share more than a common allegation that they were denied overtime or paid below the minium wage. The class members must put forth a common legal theory upon which each member is entitled to relief. Daggett, 1996 U.S. Dist. LEXIS 22465, at * 18.

Plaintiffs move to certify a class of current and former employees of defendant. The employees worked as linemen, splicers, crew foremen, laborers, or equivalent positions within the United States between June 4, 1999 and June 4, 2002, were denied overtime wages, and were compensated below the federal minium wage. Defendant objects to the certification on the ground that the putative class members are not similarly situated.

The Magistrate Judge correctly noted that there are factual differences among the putative class members. The class members have been employed by different subsidiaries and affiliates of defendant Orius Corp. The class members held different job titles, enjoyed different payment structures (piece-rate, hourly, and salaried), and worked at nine different job sites. Thus, the dissimilarities among the putative class members extend to geography, work sites, and payment systems. Further, the allegations contained in the affidavits submitted to the court suggest that each claim would require extensive consideration of individualized issues of liability and damages. Plaintiffs have failed to offer sufficient evidence to establish that the putative class members were commonly affected by a uniform plan or scheme to deny workers overtime compensation and minimum wages. In fact, plaintiffs repeatedly refer in their briefs to defendant's "judicial admission" that defendant acquired many smaller companies and was aware of potential wage and hour violations committed by the acquired entities. Indeed, this fact cuts against plaintiffs' argument that they were victims of a uniform, national policy to deny workers overtime and minimum wages. If much of the unlawful conduct was committed by small, individual companies who were later acquired by defendant, then plaintiffs who worked for these separate entities are not related as victims of a uniform, national policy.

Because plaintiffs have failed to establish that the putative class members are similarly situated, class certification would not lead to the efficiency gains and uniform fact determinations that § 216(b) was designed to create. Rather, a collective action certified on the facts presented thus far would be mired in particularized determinations of liability and damages, rather than collective consideration of common questions of law and fact.

Final class status may be reviewed before trial, and the "similarly situated" determination can be reevaluated. Sperling v. Hoffman-La Roche, Inc., 118 F.R.D. 392, 407 (D.N.J. 1988) ("Finally, nothing would appear to prevent the court from modifying or reversing a decision on "similar situations" at a later time in an action, as new facts emerge."). If, after further discovery, the named plaintiffs are able to present more compelling evidence that they are similarly situated to a larger class of victims based on a national policy, the court may entertain a renewed motion to certify a collective action.

The court adopts the Magistrate Judge's Findings and Recommendation (Doc. #36). Plaintiffs' motion for certification of a collective action (Doc. #4) is DENTED.