Laughlin v. Jim Fischer, Inc.

JOSHUA LAUGHLIN and GREG SCOTTO JR.,on behalf of themselves andall others similarly situated, Plaintiffs, v. JIM FISCHER, INC., Defendant.

Case No. 16-C-1342

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF WISCONSIN

March 31, 2019

DECISION AND ORDER GRANTING-IN-PART AND DENYING-IN-PART SUMMARY JUDGMENT

Plaintiffs Joshua Laughlin and Greg Scotto, Jr., brought this hybrid wage-and-hour collective class and class action against their former employer, Defendant Jim Fischer, Inc. (Fischer), on behalf of themselves and others similarly situated hourly job-site employees. Plaintiffs allege that Fischer violated the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201, et seq., and Wisconsin's wage laws, Wis. Stat. § 109.01, et seq. Specifically, Plaintiffs allege that Fischer failed to compensate them for travel time to and from the shop to job sites on those occasions when they did work at the shop, improperly excluded 401(k) contributions on prevailing wage jobs when determining the regular rate of pay for overtime purposes, failed to pay overtime on all hours worked over forty hours due to offsetting weekly overtime hours with daily overtime hours on prevailing wage jobs, violated Wisconsin law by calculating overtime based on the type of work conducted by Plaintiffs during overtime hours rather than based on their regular rate of pay, missclassified work done by Plaintiffs on a prevailing wage job, failed to annualize 401(k) and healthcare contributions when calculating contribution credits on prevailing wage jobs, and failed to compensate Scotto for overtime work the week of January 9, 2016. The court has jurisdiction over the FLSA claims pursuant to 28 U.S.C. § 1331 and supplemental jurisdiction over the state law claims pursuant to 28 U.S.C. § 1367.

The court granted Plaintiffs' motion for conditional certification of an FLSA collective action on October 16, 2017, ECF No. 39, and denied Defendant's motion to decertify the collective action and granted Plaintiffs' motion for Rule 23 certification of their state law claims on June 4, 2018. ECF No. 86. Pending before the court now is Plaintiffs' motion for summary judgment. For the reasons set forth below, I now conclude that Plaintiffs' motion for summary judgment should be denied as to all claims except Scotto's claim for unpaid overtime for the week ending January 9, 2016. I also conclude that I erred in denying Defendant's motion to decertify the FLSA collective action and in granting Plaintiffs' motion for Rule 23 class certification of their state law claims. It has now become clear from the briefs and argument on summary judgment that as to all of Plaintiffs' claims, to the extent they have merit, individual factual issues predominate over any common issues. Plaintiffs' collective FLSA action and Rule 23 class action will therefore be decertified, and the case will no longer proceed as a class action.

BACKGROUND

Laughlin and Scotto are former job site hourly employees of Fischer, a concrete contractor that does business throughout northeastern Wisconsin. Laughlin worked for Fischer between July and August of 2016. Decl. of Joshua Laughlin, ¶ 2, ECF No. 25. Scotto worked for Fischer between 2015 and 2017. Decl. of Greg Scotto, Jr., ¶ 2, ECF No. 26. Laughlin filed this action onOctober 6, 2016, and Scotto was added as an additional named plaintiff in an amended complaint filed on January 31, 2017. Laughlin and Scotto both claim that, when they were working for Fischer, they would complete their own time cards that listed ten different categories of work in which they were required to record their hours. Pl.'s Proposed Findings of Fact (PPFOF) ¶ 1, ECF No. 76. Company policy required that they record their time loading trucks at the company shop under the column designated "loading" and their time loading trucks at the jobsite as "Laborer." Id. ¶ 2. Plaintiffs assert that on some days, they went to the company shop, they spent time loading a truck at the shop and then traveled to the jobsite. Id. ¶ 3. Although they were paid for their work loading the truck, they contend they were not paid for the travel time from the shop to the jobsite. Id. ¶¶ 3, 4. Both Laughlin and Scotto state that they recorded their time loading the truck on their time cards, but did not record their travel time pursuant to Fischer's policy that an employee is paid for driving between the shop and the jobsite only if he is required to drive a company truck. Id. ¶ 5. Both also state that on another day, they returned from a jobsite to the shop and performed 15 minutes of loading work at the shop. Again they state that they did not include travel time pursuant to Fischer policy and were not paid for their travel back to the shop. Id. ¶¶ 6, 7. Plaintiffs contend that the company Controller, with the assistance of Jim Fischer's daughter in the summer, was responsible for reviewing their time cards and correcting any errors. Id. ¶¶ 7-9.

Plaintiffs further allege that in certain weeks they received overtime pay but claim that it was not calculated on the proper base pay because Fischer failed to use a blended pay rate when the work performed over the week was paid at different rates. Plaintiffs also contend that Fischer's 401(k) contributions for work paid at the prevailing wage rate required for certain government contractswere not included in the base rate on which the overtime rate of pay was calculated. Additional facts pertinent to the specific issue addressed will be set forth below.

LEGAL STANDARD

Summary judgment should be granted when the moving party shows that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). In other words, the time and expense of the parties and the court should not be wasted on a trial when there are no material facts in dispute, one party is entitled to judgment on those facts, and thus there is nothing to try. In deciding a motion for summary judgment, all reasonable inferences are construed in favor of the nonmoving party. Foley v. City of Lafayette, 359 F.3d 925, 928 (7th Cir. 2004). The party opposing the motion for summary judgment must "submit evidentiary materials that set forth specific facts showing that there is a genuine issue for trial." Siegel v. Shell Oil Co., 612 F.3d 932, 937 (7th Cir. 2010) (quoted source and internal quotation marks omitted). "The nonmoving party must do more than simply show that there is some metaphysical doubt as to the material facts." Id. Summary judgment is properly entered against a party "who fails to make a showing sufficient to establish the existence of an element essential to the party's case, and on which that party will bear the burden of proof at trial." Parent v. Home Depot U.S.A., Inc., 694 F.3d 919, 922 (7th Cir. 2012) (internal quotation marks omitted) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)).

ANALYSIS

A. Compensation for Plaintiffs' Unreported Travel Time Between Fischer's Shop and Job Site When Loading Time Reported on Time Card

Plaintiffs' class travel time claims deal with two questions: "(1) whether Defendant had a uniform, unofficial policy requiring employees to report to the shop to receive their jobsite assignments and (2) whether filling out time cards at the shop after working at a jobsite constitutes a principal activity." ECF No. 86 at 6. In their motion for summary judgment Plaintiffs are seeking summary judgment on a very limited question: whether Fischer's failure to compensate them for unrecorded travel time to and from job sites when their time cards indicated they spent time loading or unloading at Fischer's shop violates both federal law, 29 C.F.R. § 785.38, and state law, Wis. Admin. Code DWD § 272.12(2)(g)5. Fischer claims it did not have actual or constructive knowledge of Plaintiffs' alleged uncompensated activities and that even if it did, such activities are exempt from compensation because the time spent was de minimis.

When Fischer hired an employee, its Controller sat down with the employee to discuss the company's various policies, including how to properly fill out daily timecards. Employees were told that, if they spent time in the shop in the morning loading a company vehicle, their work day commenced at that time, and they should record all of their time on their timecards. Fischer's Employee Handbook states, "Travel time to and from the jobsite is not a part of your hours of pay. If your supervisor has specifically instructed you to drive a company vehicle to or from the job site you will be paid for the travel time." ECF No. 83-5 at 4. Once timecards were turned in, Fischer's Controller reviewed all employee timecards, and totaled the amount of time spent at the jobsite and the amount of time doing other work, such as loading and driving.

In support of their claim, Plaintiffs use Laughlin's timecard from August 1, 2016, as an example. On that day Laughlin recorded 15 minutes for loading a vehicle at the shop, recorded no driving time, and recorded 10.5 hours for time spent working at the job site. ECF No. 79-2. Because Laughlin recorded time in the loading column of the timecard, Plaintiffs argue Fischer, through the exercise of reasonable diligence, should have known Laughlin would had to have spent time traveling that day to or from the shop to the work site and that he was not being compensated for that travel time.

Both the FLSA and Wisconsin's Minimum Wage provide that "[t]ime spent by an employee in travel as part of his principal activity, such as travel from job site to job site during the workday, must be counted as hours worked." 29 C.F.R. § 785.38; Wis. Admin. Code § DWD 272.12(2)(g)5. Fischer does not contest that any travel time by Plaintiffs after loading or unloading company vehicles at the shop would be compensable. Def.'s Br. in Opp'n, ECF No. 81 at 7. Rather, Fischer claims it did not know about the travel time, and thus is not required to...