LITTLE ROCK (Legal Newsline) - The Arkansas Supreme Court has ordered a lower court to decertify a class action lawsuit brought by hourly, non-nursing employees at the state Department of Veterans Affairs who claim they weren’t paid for meal breaks they were required to work.
The state’s highest court, in a 4-3 ruling, pointed to the “highly individualized nature” of the employees’ claims.
“In reviewing ADVA’s argument regarding predominance, we agree with its position,” Justice Karen Baker wrote for the majority. “Even assuming that there are questions common to all class members, these common issues do not predominate over individual issues.”
The employees sought class certification alleging that ADVA violated the AMWA due to the agency’s failure to pay the employees for overtime hours worked.
Specifically, the employees allege that ADVA automatically deducted 30 minutes per day from their hours worked to account for meal breaks, even though they were regularly required to work during their meal breaks.
The employees also sought certification to resolve the issues of unpaid time worked during pre- and post-shift hours.
Last November, the Pulaski County Circuit Court entered an order granting class certification regarding the meal breaks.
The circuit court determined that the common question as to the class members was “whether Defendant’s systematic and automated practice of deducting meal breaks is a violation of the AMWA (Arkansas Minimum Wage Act).”
Under the AMWA, “no employer shall employ any of his or her employees for a workweek longer than forty (40) hours unless the employee receives compensation for his or her employment in excess of the hours above specified at a rate not less than one and one-half (1 1/2) times the regular rate of pay at which he or she is employed.”
However, in lieu of overtime compensation, the State may award compensatory time off at a rate of not less than one and one-half (1 1/2) hours for each hour of employment for which overtime compensation is required.
The lower court found that class certification was inappropriate as to pre- and post-shift work claims.
The court stated that “[i]n contrast to the automated meal break deductions, Plaintiffs fall short of demonstrating a policy, scheme or uniform practice that allegedly deprived Plaintiffs of compensation for work performed off-the-clock.”
On Dec. 23, 2014, ADVA filed an appeal with the Supreme Court.
On appeal, the agency argues the circuit court abused its discretion in certifying the class.
The employees, ADVA noted, sought to represent about 150 individuals who held one of 21 different non-nursing positions.
The majority, in reaching its eight-page decision, pointed to its June ruling in a companion case, Arkansas Department of Veterans Affairs v. Okeke.
In Okeke, the Supreme Court determined that a lower court did not abuse its discretion and upheld the class action status for the lawsuit filed by a group of nurses against ADVA.
But there is a “marked distinction” between the present case and Okeke, the high court noted.
“Unlike Okeke, where the nursing employees held the same or very similar positions, here, the class members do not share the same or similar job duties that would require them to work through their meal breaks,” Baker wrote in the Nov. 19 ruling. “The issues of whether an employee worked during unpaid meal breaks and whether this resulted in the employee working over 40 hours in a week will vary greatly with each employee.”
Baker continued, “As ADVA asserts, the mere existence of a policy of making automatic deductions for scheduled meal breaks does not, in and of itself, violate AMWA. A determination of ADVA’s liability under AMWA would require a highly individualized inquiry as to each employee’s hours worked during a given week because, if the employee did not work through lunch, and if the employee failed to work more than 40 hours in a given work week, there could be no liability on the part ADVA.”
Justice Robin Wynne, who authored the dissenting opinion, said the majority’s statement -- “the mere existence of a policy of making automatic deductions for scheduled meal breaks does not, in and of itself, violate AMWA” -- is a “new holding.”
“Reaching this point of substantive law is both unnecessary and in violation of the long-established rule that we do not reach the merits of a claim in deciding an appeal regarding class certification,” he wrote.
The case has been remanded to the circuit court with instructions to decertify the class.
Because the Supreme Court reversed, it did not reach the remaining issues on appeal.
From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.