Lancaster v. FQSR

LATOYA LANCASTER, VICTOR L. BROWN,MARTIN JENNINGS and SHAMEKICA PROCTOR,Individually and on Behalf of Others Similarly Situated, Plaintiffs, v. FQSR, d/b/a KBP Foods, Defendant.

Civil Action No. TDC-19-2632

UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND

September 11, 2020

MEMORANDUM OPINION

Plaintiffs Latoya Lancaster, Victor Brown, Martin Jennings, and Shamekica Proctor, acting individually and on behalf of all similarly situated individuals, have filed this action against their current or former employer, FQSR LLC, d/b/a KBP Foods ("FQSR"), alleging violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-219 (2018), the Maryland Wage and Hour Law ("MWHL"), Md. Code Ann., Lab. & Empl. §§ 3-401 to 3-431 (LexisNexis 2016), and the Maryland Wage Payment and Collection Law ("MWPCL"), Md. Code Ann., Lab. & Empl. §§ 3-501 to 3-509, as well as a common law claim of unjust enrichment, based on the failure to pay them wages for all of their time worked, including overtime. Plaintiffs assert the FLSA claim as a collective action under 29 U.S.C. § 216(b) and the state law claims as a class action under Federal Rule of Civil Procedure 23. Pending before the Court is Plaintiffs Pre-Discovery Motion for Conditional Certification of the FLSA collective action. Having reviewed the submitted materials, the Court finds no hearing necessary. D. Md. Local R. 105.6. For the reasons set forth below, Plaintiffs' Motion will be GRANTED IN PART and DENIED IN PART.

BACKGROUND

FQSR operates approximately 700 Kentucky Fried Chicken ("KFC") and Taco Bell franchise restaurants across the United States. Currently, FQSR operates 20 KFC restaurants in Maryland, seven of which were acquired by FQSR in July 2019. FQSR's Maryland restaurants are divided into three regions. Thomas Chalkley, who has been employed by FQSR since June 2016, is the Area Coach responsible for one of those three regions encompassing the restaurants in Prince Frederick, Kettering, Upper Marlboro, La Plata, Waldorf, and Bryans Road, Maryland.

FQSR employed each of Plaintiffs at the KFC in La Plata, with two having also worked at various times at the KFC in Upper Marlboro, on a non-exempt hourly basis for various time periods beginning from 2008 until the present. Plaintiffs claim that throughout their employment with FQSR, they regularly worked in excess of 40 hours during a workweek but ultimately were not paid for all of that time worked because FQSR managers, through various methods, eliminated or reduced the number of work hours credited for pay. These methods included supervisors: (1) directly adjusting downward the number of hours in existing time records; (2) inaccurately entering an employee's time when the restaurant's timekeeping system requiring the employee's fingerprint to clock in and out was not working; (3) directly clocking out employees who were still working, without their knowledge; and (4) directing employees to clock out even while they continued working and falsely promising to add the time to another workday. Plaintiffs allege that FQSR incentivized its managers to engage in these practices by offering bonuses if they kept "Hourly Labor" metrics low. Compl. ¶ 17, ECF No. 1.

Lancaster filed this action on behalf of herself and those similarly situated alleging that based on these practices, FQSR unlawfully failed to pay non-exempt employees for all hours worked and failed to provide overtime pay for certain overtime hours, in violation of the FLSA, MWHL, and MWPCL, and resulting in unjust enrichment. Lancaster has brought her FLSA claim as a collective action pursuant to 29 U.S.C. § 216(b) and her state law claims as a class action pursuant to Federal Rule of Civil Procedure 23. Pursuant to 29 U.S.C. § 216(b), Brown, Jennings, and Proctor have opted into the FLSA collective action as additional plaintiffs.

DISCUSSION

In their Pre-Discovery Motion for Conditional Certification, Plaintiffs requested that the Court conditionally certify an FLSA collective action on behalf of "All individuals who have worked at one of [FQSR's] KFC or Taco Bell restaurant franchises located in Maryland within the last three years and were classified as nonexempt from the overtime pay mandates." Mot. Conditional Certification ("Mot.") at 1, ECF No. 37-1. Plaintiffs have since amended their proposed collective action definition to consist of "All individuals who have worked at one of [FQSR's] KFC or Taco Bell restaurant franchises located in Maryland within the last three years and were classified as nonexempt from the overtime pay mandates except those who only worked as either 'Co-Managers' and 'Shift Managers' during the entire period." Reply at 3, ECF No. 42. Plaintiffs contend that this putative class of employees at FQSR restaurants across Maryland consists of individuals similarly situated to Plaintiffs in that they: (1) are paid on an hourly basis; (2) have regularly worked more than 40 hours in a single workweek; and (3) have not been compensated for all of their work activities.

Although FQSR argued, in opposing the Motion, that the Plaintiffs' original putative class definition was too broad because it includes certain managers exempt from the overtimerequirements but who were responsible for the allegedly unlawful practices, where Plaintiffs have modified their class definition to exclude such managers, and FQSR has not seriously contested that such exclusion would cure the alleged deficiency in the collective action definition, the Court need not further address that particular argument. See, e.g., Cowan v. Nationwide Mut. Ins. Co., No. 2:19-cv-1225, 2019 WL 4667497, at *7 (S.D. Ohio Sept. 25, 2019) (considering at the FLSA conditional class certification stage the plaintiff's amended proposed class definition as stated in the reply brief, which narrowed the scope from all of defendant's hourly call-center employees to all non-exempt employees who had worked at or for defendant's call centers and provided direct customer support and assistance through phone or email systems); Sawyer v. Health Care Sols. at Home, Inc., No. 5:16-CV-5674, 2018 WL 1959632, at *3 (E.D. Pa. Apr. 25, 2018) (considering the plaintiff's narrowed class definition as stated in his reply brief).

I. Legal Standard

The FLSA generally requires that employees who work more than 40 hours in a week receive overtime pay at the rate of one and one-half times their regular pay rate. See 29 U.S.C. § 207(a). If an employer violates these rules, employees may sue their employers as individuals or, if they choose, in a collective action on behalf of themselves and "similarly situated" employees. 29 U.S.C. § 216(b); see Simmons v. United Mortg. & Loan Inv., LLC, 634 F.3d 754, 758 (4th Cir. 2011). If employees choose to pursue a collective action, they may seek court-approved notice to inform similarly situated employees that they may join the litigation. See Hoffman-La Roche v. Sperling, 493 U.S. 165, 169 (1989) (discussing the parallel collective action provision under the Age Discrimination in Employment Act).

The collective action provision serves several purposes. First, collective actions allow plaintiffs "the advantage of lower individual costs to vindicate rights by the pooling of resources."Id. at 170. Second, collective actions allow the courts efficiently to resolve common issues in one proceeding. See id. Third, FLSA collective actions promote enforcement of the law by empowering employees to "join in their litigation so that no one of them need stand alone in doing something likely to incur the displeasure of an employer." See Pentland v. Dravo Corp., 152 F.2d 851, 853 (3d Cir. 1945).

Although the United States Court of Appeals for the Fourth Circuit has not provided specific guidance on how to address a motion for conditional certification of an FLSA collective action, decisions from other Courts of Appeals have identified, and judges of the United States District Court for the District of Maryland generally apply, a two-step process to test the sufficiency of the purported class: (1) a pre-discovery determination that the purported class is similarly situated enough to disseminate notice (the "notice stage"); and (2) a post-discovery determination, typically in response to a motion for decertification, that the purported class is indeed similarly situated. See, e.g., Thiessen v. General Electric Capital Corp., 267 F.3d 1095, 1102 (10th Cir. 2001); Hipp v. Liberty Nat'l Life Ins. Co., 252 F.3d 1208, 1218-19 (11th Cir. 2001); Mooney v. Aramco, 54 F.3d 1207, 1213-14 (5th Cir. 1995); Randolph v. Powercomm Constr., Inc., 7 F. Supp. 3d 561, 575 (D. Md. 2014); Syrja v. Westat, Inc., 756 F. Supp. 2d 682, 686 (D. Md. 2010). At the notice stage, courts applying this process make a threshold determination whether the class is similarly situated based on "substantial allegations" in the pleadings and any submitted affidavits or declarations. See Thiessen, 267 F.3d at 1102. Then, once discovery is largely completed, such courts perform a more stringent inquiry into whether the class is indeed similarly situated. Mooney, 54 F.3d at 1214.

Because the record is sparse at the notice stage, courts often apply "a fairly lenient standard." Id.; Hipp, 252 F.3d at 1218 (noting that courts use a "fairly lenient standard" that"typically results in 'conditional certification'" at the notice stage); Randolph, 7 F. Supp. 3d at 575-76. Thus, courts require no more than "substantial allegations that the putative class members were together the victims of a single decision, policy, or plan." Thiessen, 267 F.3d at 1102 (citations omitted); Randolph, 7 F. Supp. 3d at 575-76. Although vague allegations with meager factual support are generally insufficient to certify a class, proponents of conditional class certification need not conclusively demonstrate that a class of similarly situated plaintiffs exists. See Randolph, 7 F. Supp. 3d at 576; Syrja, 756 F. Supp. 2d at 686 (requiring "relatively...