Iannotti v. Wood Group Mustang

603 F.Supp.3d 649

Chris IANNOTTI, individually and for others similarly situated, Plaintiff,

v.WOOD GROUP MUSTANG, Defendant.

Case No. 20-cv-958-DWD

United States District Court, S.D. Illinois.

Signed May 20, 2022

Carl A. Fitz, Melodie Arian, Michael A. Josephson, Josephson Dunlap LLP, Houston, TX, Richard J. Burch, Bruckner Burch PLLC, Houston, TX, Douglas M. Werman, Werman Salas PC, Chicago, IL, for Plaintiff.

Bryan Edward Bowdler, Stephen Mark Klyza, Kullman Firm, New Orleans, LA, for Defendant.

MEMORANDUM AND ORDER

DUGAN, District Judge:

Plaintiff Chris Iannotti, individually and on behalf of others similarly situated, brings this complaint against Defendant Wood Group Mustang, alleging violations of the Fair Labor Standards Act ("FLSA"), the Illinois Minimum Wage Law ("IMWL"), and the Illinois Wage Payment and Collection Act ("IWPCA"). Plaintiff seeks to bring the FLSA claim as a nationwide collective action under 29 U.S.C. § 216(b), and the Illinois-law claims as a class action under Fed. R. Civ. P. 23.

Now before the Court is Plaintiff's Motion for Conditional Certification (Doc. 50). Defendant timely opposed the Motion (Doc. 57), and the Court held a hearing on May 4, 2022. Having considered the briefing and arguments, and for the reasons set forth below, the Court will grant the Motion for Conditional Certification. However, the Court will provisionally limit notice to Illinois employees, while reserving ruling on the issue of personal jurisdiction for potential out-of-state opt-in plaintiffs.

Background

The FLSA prohibits employers from requiring an employee to work more than forty hours in a workweek unless the employee receives compensation of at least one-and-a-half times their regular rate. 29 U.S.C. § 207(a)(1). For violations of this provision, the FLSA authorizes collective actions by employees on behalf of themselves and other employees who are "similarly situated." 29 U.S.C. § 216(b).¹ Plaintiff Iannotti is a former employee of Defendant. Plaintiff alleges that he, and others similarly situated, worked as day rate employees of Defendant, and were paid a flat amount for each day worked regardless of the number of hours they worked (Doc. 1, ¶¶ 2, 31-38). Plaintiff alleges on his own behalf, and on behalf of the potential class, that Defendant willfully violated the FLSA by using this "day rate scheme" to pay its employees a day rate without overtime pay for the hours worked in excess of forty hours in a work week (Id. ).

Plaintiff requests that this Court conditionally certify a collective action, defining the potential class as: All employees Wood Group paid according to its day rate pay plan in the past three years (Doc. 50). Defendant opposes certification, arguing that Plaintiff cannot prove potential members of the proposed class are "similarly situated" such that resolving the class claims will require highly individualized inquiries. Defendant further argues that if a conditional class is certified, that the class should be limited to Defendant's employees who worked in Illinois. Here, Defendant renews its jurisdiction argument, asserting that the Court would lack personal jurisdiction over Defendant as to any claims brought by employees who did not live or work in Illinois, i.e., the out-of-state opt-in plaintiffs.²

Discussion

The Seventh Circuit has not identified a specific standard for certifying a collective action under the FLSA. Instead, district courts have "wide discretion" in determining how these suits should proceed. Weil v. Metal Techs., Inc. , 925 F.3d 352, 357 (7th Cir. 2019). In exercising its discretion, the district courts must "respect judicial neutrality and avoid even the appearance of endorsing the action's merits." Bigger v. Facebook, Inc. , 947 F.3d 1043, 1046 (7th Cir. 2020). District courts in this Circuit generally apply an ad hoc two-step process in these cases.³ See Owens v. GLH Cap. Enter., Inc. , No. 3:16-CV-1109-NJR-SCW, 2017 WL 2985600, at *1 (S.D. Ill. July 13, 2017) (citing Jirak v. Abbott Lab'ys, Inc. , 566 F. Supp. 2d 845, 847 (N.D. Ill. 2008) (collecting cases)); Dennis v. Greatland Home Health Servs., Inc. , 438 F. Supp. 3d 898, 899 (N.D. Ill. 2020) ; Woods v. Club Cabaret, Inc. , 140 F. Supp. 3d 775, 780 (C.D. Ill. 2015).

In the first step, i.e. "conditional certification", a court must determine whether the plaintiff and members of the proposed class are similarly situated enough to allow notice to be sent to prospective plaintiffs. Heckler v. DK Funding, LLC , 502 F. Supp. 2d 777, 779 (N.D. Ill. 2007). Conditional certification typically occurs where the parties have engaged in only minimal discovery. See Mielke v. Laidlaw Transit, Inc. , 313 F. Supp. 2d 759, 762 (N.D. Ill. 2004). Therefore, at this early stage, courts apply a more lenient "minimal showing" or "modest factual showing" standard to determine whether the class is similarly situated. Dennis , 438 F. Supp. 3d at 899 (citing Jirak , 566 F. Supp. 2d at 847 ; Mielke , 313 F. Supp. 2d at 762 ); see also Flores v. Lifeway Foods, Inc. , 289 F. Supp. 2d 1042, 1045 (N.D. Ill. 2003) (referring to this standard as a "modest factual showing"); Gambo v. Lucent Techs., Inc. , No. 05 C 3701, 2005 WL 3542485, at *4 (N.D. Ill. Dec. 22, 2005).

The modest factual showing is a lenient burden of proof and is often based only upon the pleadings and any affidavits submitted by the parties." Beeson v. C-Cat, Inc. , No. 120CV00252JPHMPB, 2020 WL 7425339, at *2 (S.D. Ind. Dec. 18, 2020), at *2 (citation and internal quotation marks omitted); see also Pieksma v. Bridgeview Bank Mortg. Co., LLC , No. 15 C 7312, 2016 WL 7409909, at *1 (N.D. Ill. Dec. 22, 2016) (Plaintiff must provide "some evidence in the form of affidavits, declarations, deposition testimony, or other documents to support the allegations that other similarly situated employees were subjected to a common [unlawful] policy" (internal citation omitted)). The Court does not, however, "make merits determinations, weigh evidence, determine credibility, or specifically consider opposing evidence presented by a defendant." Id. (quoting Briggs v. PNC Fin. Servs. Grp., Inc. , No. 15-CV-10447, 2016 WL 1043429, at *2 (N.D. Ill. Mar. 16, 2016) ). A factual nexus that binds potential members of a collective action together is sufficient to meet this burden. Gambo , 2005 WL 3542485, at *4. If the employees are found to be similarly situated, class members are given notice of the suit and an opportunity to opt-in. Flores , 289 F. Supp. 2d at 1045.

The second step of certification occurs after substantial discovery is complete, at which time the party opposing collective action typically moves to decertify the class. Mielke , 313 F. Supp. 2d at 762. At this stage, the Court makes a more stringent, factual determination as to whether the members of the class are similarly situated. Id. (citing Thiessen v. Gen. Elec. Cap. Corp. , 267 F.3d 1095, 1103 (10th Cir. 2001) ).

Here, the parties disagree as to whether Plaintiff and the proposed class are similarly situated. Plaintiff argues that the proposed class is similarly situated because all members are non-exempt employees who were paid a flat daily rate without overtime and regularly worked in excess of 40 hours a week but were not compensated for those excess hours. Conversely, Defendant argues that the proposed class is not similarly situated because of the individual differences in the employees’ alleged guaranteed pay rates and job duties. Specifically, Defendant contends that the varying differences between each employee's compensation and job duties will require the Court to conduct highly individualized inquiries in order to determine whether each employee qualified for an exemption set forth in the Act. Defendant specifically refers to the reasonable relationship test in 29 C.F.R. § 541.604(b), which exempts certain employees from overtime pay if Defendant can show that each employee is guaranteed at least the minimum weekly amount required by the FLSA regulations and that a "reasonable relationship" exists between the guaranteed amount and the amount actually earned. Defendant also argues that the proposed class members have significantly varied job duties, ranging from right of way agents to safety inspectors. In short, Defendant argues that these differences will require individual assessments of each employee's salaries and job duties rendering representative discovery and evidence difficult.

Generally, the determination of whether Plaintiff and others similarly situated qualify as exempt employees under the FLSA is a merits determination that will be considered at the second phase of certification after the parties have conducted discovery, and not at this initial conditional inquiry. See, e.g. , Slaughter v. Caidan Mgmt. Co., LLC , 317 F. Supp. 3d 981 (N.D. Ill. 2018) ("the applicability of FLSA exemptions typically is not addressed during step one of the certification analysis") (citing Ivery v. RMH Franchise Corp. , 280 F. Supp. 3d 1121 (N.D. Ill. 2017) ); Briggs , 2016 WL 1043429, at *5 (at the conditional certification stage, an employer's assertion of an exemption defense is a "premature merit-based argument" requiring a more fact-intensive analysis which is "better accomplished with the aid of discovery"). Moreover, "[P]laintiffs can be similarly situated for purposes of the FLSA even though there are distinctions in their job titles, functions, or pay." Ruffolo v. LaSalle Grp., Inc. , No. 18 C 3305, 2019 WL 978659, at *5 (N.D. Ill. Feb. 28, 2019) (citing Jirak , 566 F. Supp. 2d at 848–49 ); Garza v. Chicago Transit Auth. , No. 00 C 0438, 2001 WL 503036, at *3 (N.D. Ill. May 8, 2001) ("That the Plaintiffs and other potential plaintiffs may have different jobs ... [and] earn different amounts of money ... does not mean that they are not operating under the same policies that allegedly entitle them to overtime pay"); see also Ford v. U.S. Foods, Inc. , No. 19-CV-05967, 2020 WL 5979553, at *3 (...