Employees win most motions for conditional certification under the FLSA, with many courts declining to perform a probing analysis at that stage. A recent case from the District of Minnesota, in which the court still applied a deferential standard, had the unusual result that the court granted conditional certification as to a single Chipotle store when the plaintiffs sought a nationwide class.
In Harris v. Chipotle Mexican Grill, Inc., Case No. 13-cv-1719 (SRN/SER) (D. Minn., Sept. 9, 2014), the plaintiffs worked at a Chipotle restaurant in a Minneapolis suburb. They contended that the company, due to payroll budget restrictions, required various hourly employees to work off the clock. All of the named plaintiffs worked at the same location, but they sought certification of a nationwide class of approximately 40,000 workers at 1500 restaurants. They relied heavily on the fact that the company encouraged the management of payroll costs and used the same electronic timekeeping system (cleverly named “Aloha”) at all of its stores. The magistrate judge issued a report and recommendation that, among other things, would have certified such a class.
We’ll spare you all the procedural wrangling, of which there was a lot. The district court ultimately found that while there was no basis for a nationwide class, it would conditionally certify a class consisting of a single restaurant – the one where the plaintiffs worked.
The Harris case is unusual in this respect – many courts typically either certify the class or refuse to do so altogether. The Harris result was likely a major disappointment to the plaintiffs, who now have a relatively small FLSA class to prosecute without the hammer of nationwide discovery to hold over the defendant, let alone the prospect of a major fee award at the end.
The district court, however, likely got it right as to the geographic scope of the class. The core of the plaintiffs’ evidence as to a nationwide violation was little more than the commonsense, garden-variety policies. Payroll costs are a business expense. Companies that want to stay in business watch such expenses. A desire to control payroll costs is no different from a desire to control rent, utilities, food costs, etc. Despite its responsible intention to manage payroll costs, the company’s nationwide policies expressly forbid off-the-clock work.
Similarly, while the plaintiffs relied on the company’s timekeeping system, it makes little sense for an employer to use multiple systems that are likely to function differently, cause confusion, and possibly lead to a greater number of wage and hour violations as a result.
While there are areas to quibble with the court’s opinion, including a decision to include some hourly managers in the class (which will inevitably create conflicts), the Harris case reflects a more thoughtful analysis of conditional certification issues than often seen elsewhere.
The bottom line: One viable outcome when plaintiffs seek a nationwide class is a smaller one involving the location where the putative class representatives actually worked.