Luna-Reyes v. RFI Constr., LLC

109 F.Supp.3d 744

Joaquin LUNA–REYES, on behalf of himself and all others similarly situated, Plaintiff,

v.RFI CONSTRUCTION, LLC, Rupert Burrows, and William Warrick, Defendants.

No. 1:14CV235.

United States District Court, M.D. North Carolina.

Signed June 1, 2015.

Jimmy Derek Braziel, Lee & Braziel, LLP, Dallas, TX, Gilda A. Hernandez, Law Offices of Gilda A. Hernandez, PLLC, Apex, NC, for Plaintiff.

Theodore C. Edwards, II, Kilpatrick Townsend & Stockton LLP, Raleigh, NC, for Defendants.

MEMORANDUM OPINION AND ORDER

THOMAS D. SCHROEDER, District Judge.

This is an action by Plaintiff Joaquin Luna–Reyes under the Fair Labor Standards Act (FLSA) of 1938, 29 U.S.C. §§ 201 et seq., and the North Carolina Wage and Hour Act (NCWHA), N.C. Gen.Stat. §§ 95–25.1 et seq. The case was previously before the court on the motion of Defendants RFI Construction, LLC, ("RFI Construction") and Rupert Burrows (collectively the "RFI Defendants") to dismiss the first amended complaint for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. 14.) The court treated the motion as one for a more definite statement, and granted it. Luna–Reyes v. RFI Const., LLC, 57 F.Supp.3d 495 (M.D.N.C.2014). In response, Luna–Reyes filed a second amended complaint, and the case returns on RFI Defendants' motion to dismiss. (Doc. 29.) For the reasons set forth below, the court finds that the current complaint states plausible claims, and thus RFI Defendants' motion will be denied.

I. BACKGROUND

The facts, viewed in the light most favorable to Luna–Reyes as the non-moving party, are as follows:

Defendant RFI Construction is a North Carolina limited liability company. (Doc. 28 ¶ 7.) RFI Construction is certified for lead renovation, repair, and painting and specializes "in concrete, masonry, structural steel, roofing, store fronts, carpentry and other jobs required in commercial construction." (Id. ¶ 23.) Defendant Burrows is its owner and CEO and handles its day-to-day business, including approving employees' pay. (Id. ¶ 42.) RFI Defendants subcontracted with Defendant William Warrick "to perform subcontracted work for those two Defendants for projects on which RFI was working." (Id. ¶¶ 24–25, 44.) His responsibilities generally included the provision of "the manpower to get the job done." (Id. ¶¶ 24, 26.)

At some time before October 2013, Warrick contacted Luna–Reyes to work for "all Defendants" and "made the offer" of employment to Luna–Reyes. (Id. ¶¶ 27, 44.) Warrick allegedly did this "in conjunction with" RFI Defendants so that RFI Defendants could fulfill their contract with another contractor. (Id. ¶ 26.) For approximately the entire month of October 2013, Luna–Reyes worked as an hourly-paid (non-salaried) carpenter at a construction site in Durham. (Id. ¶¶ 5, 21–22.) His pay rate was set "when he was hired by War[r]ick." (Id. ¶ 30.) He could not hire someone else to perform his job or serve as his replacement. (Id. ¶ 31.) His job neither required a high degree of skill nor extended to any specific project or time. (Id. ¶¶ 32, 36.) Rather, when hired, Luna–Reyes expected to work for an indefinite period of time. (Id. ¶ 36.)

According to Luna–Reyes, the tasks of compensation and record-keeping fell largely on the shoulders of Warrick. He determined Luna–Reyes' and others' compensation and when they would be paid. (Id. ¶ 27.) Warrick, however, "was required to confer with" RFI Defendants regarding Luna–Reyes' compensation. (Id. ¶ 28.) When workers hired by Warrick, including Luna–Reyes, raised "questions or concerns about compensation practices and unpaid wages," they were "referred to" Burrows. (Id. ¶ 42.) On at least one occasion, Warrick requested additional funds from RFI Defendants, specifically Burrows, to pay Luna–Reyes and others. (Id. ¶¶ 28, 35.) Warrick's other responsibilities included recording Luna–Reyes' and others' hours, maintaining their payroll records, and paying them each Friday. (Id. ¶¶ 28, 41.) Burrows, through Warrick, had access to those records as well. (Id. ¶¶ 35, 43).

Luna–Reyes alleges that he was paid the same hourly rate for all hours he worked, even when they exceeded forty per week. (Id. ¶ 37.) He further alleges that he was not paid at all for at least one week. (Id. ) He finally alleges that other hourly-paid laborers and installers of "all Defendants" faced the same issues with their pay. (Id. ¶¶ 38–40.)

Beyond allegations regarding compensation and record-keeping, Luna–Reyes further claims that each of the Defendants split control over his work. Warrick, RFI Construction, and Burrows "controlled all aspects" of his work, namely "the manner in which he performed the work, the time he was required to be at work, and the type of work he performed." (Id. ¶ 29.) "All Defendants told Plaintiff what to do, when to do it, and how he was supposed to do it." (Id. ) They also "instructed" Luna–Reyes on how to do his job and provided him with "specialized equipment needed to perform his work." (Id. ¶¶ 32–33.) Burrows allegedly had the power to move Luna–Reyes and "putative plaintiffs" from one RFI project to another.¹ (Id. ¶ 42.) Finally, "all Defendants" could terminate his employment. (Id. ¶ 34.)

Luna–Reyes filed his original complaint on March 20, 2014, naming only RFI Construction as Defendant and asserting two causes of action. (Doc. 1.) RFI Construction answered on April 22, 2014. (Doc. 9.) Luna–Reyes then filed an amended complaint on May 16, 2014, adding Burrows and Warrick as Defendants. (Doc. 13.) Warrick has yet to be served. On June 02, 2014, RFI Defendants moved to dismiss Luna–Reyes' claims for lack of subject-matter jurisdiction and for failure to state a claim. (Doc. 14.) Following briefing from the parties, this court denied in part and granted in part RFI Defendants' motion to dismiss, permitting Luna–Reyes to amend his complaint. (Doc. 27.)

After Luna–Reyes amended his complaint a second time, RFI Defendants renewed their motion to dismiss for failure to state a claim. (Doc. 29.) Luna–Reyes responded (Doc. 33), but RFI Defendants filed no reply. The motion is now ripe for consideration.

II. ANALYSIS

A. Standard of Review

Federal Rule of Civil Procedure 8(a)(2) provides that a complaint must contain a short and plain statement of the claim showing that the pleader is entitled to relief. Under Federal Rule of Civil Procedure 12(b)(6), "a complaint must contain sufficient factual matter ... to ‘state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). A claim is plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955 ). Conclusory pleadings are "not entitled to the assumption of truth," id. at 679, 127 S.Ct. 1955, and mere " ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action will not do,’ " id. at 678, 127 S.Ct. 1955 (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955 ). A Rule 12(b)(6) motion to dismiss "challenges the legal sufficiency of a complaint considered with the assumption that the facts alleged are true." Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir.2009) (internal citations omitted).

B. Dismissal for Failure to State a Claim

RFI Defendants move to dismiss the second amended complaint for failure to state a claim under Rule 12(b)(6). They argue that the complaint fails to state sufficient factual allegations of an employment relationship with them. (Doc. 30.) Luna–Reyes maintains that he has alleged sufficient facts to state a claim under both the FLSA and NCWHA. (Doc. 33.)

1. FLSA Claim

The FLSA provides minimum and overtime pay scales for individuals who qualify as employees. 29 U.S.C. §§ 206(a)(1), 207(a)(1). It also imposes financial liability on employers who violate those provisions. 29 U.S.C. §§ 216(b). However, it "provides little guidance as to what constitutes an employer-employee relationship." Benshoff v. City of Va. Beach, 180 F.3d 136, 140 (4th Cir.1999).

Under the FLSA, an "employer" is "any person acting directly or indirectly in the interest of an employer in relation to an employee." 29 U.S.C. § 203(d) ; see also N.C. Gen.Stat. § 95–25.2(5) (defining "employer" similarly). Employers can include both companies and their officers.See Brock v. Hamad, 867 F.2d 804, 808 n. 6 (4th Cir.1989) (finding a manager liable for FLSA violations as an "employer" because "he hired and directed the employees who worked for the enterprise"); Roman v. Guapos III, Inc., 970 F.Supp.2d 407, 416 (D.Md.2013) ("It is well settled that an individual may qualify as an employer and face liability under the FLSA."). An "employee" is defined as "any individual employed by an employer." 29 U.S.C. § 203(e)(1) ; see also N.C. Gen.Stat. § 95–25.2(4) (defining "employee" similarly). To "employ" means "to suffer or permit to work." 29 U.S.C. § 203(g) ; see also N.C. Gen.Stat. § 95–25.2(3) (defining "employ" similarly). Because the FLSA is both "remedial and humanitarian in purpose," it "should be broadly interpreted and applied to effectuate its goals." Benshoff, 180 F.3d at 140 (quoting Tenn. Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590, 597, 64 S.Ct. 698, 88 L.Ed. 949 (1944) ) (internal quotation marks omitted). The FLSA is "comprehensive enough to require its application to many persons and working relationships, which prior to [it], were not deemed to fall within an employer-employee category." Rutherford Food Corp. v. McComb, 331 U.S. 722, 729, 67 S.Ct. 1473, 91 L.Ed. 1772 (1947) (quoting Walling v. Portland Terminal Co., 330 U.S. 148, 151, 67 S.Ct. 639, 91 L.Ed. 809 (1947) ).

RFI Defendants offer four grounds requiring dismissal of Luna–Reyes' FLSA claim: (1) "Plaintiff failed...