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Friday, September 20, 2019

Plaintiffs ready to appeal adverse decision in FLSA lawsuit against Chipotle

By Sara McCleary | Jun 29, 2017

NEW YORK (Legal Newsline) – Plaintiffs lawyers are preparing their appeal of a New York federal judge's decision to decertify a collective action against Chipotle.

Attorneys have asked Judge Andrew Carter, of the Southern District of New York, to certify his March 29 order so they can file an interlocutory appeal with the U.S. Court of Appeals for the Second Circuit.

In his opinion, Carter granted Chipotle Mexican Grill’s motion to decertify the Fair Labor Standards Act case against it. The plaintiffs sought to certify six classes under the laws of New York, Missouri, Colorado, Washington, Illinois and North Carolina. The case hinged on allegations that Chipotle had misclassified employees in the position of “apprentice” to avoid paying them overtime wages. 

According to Professor Arthur S. Leonard, the Robert F. Wagner Professor of Labor and Employment Law at New York Law School, FLSA litigation is not uncommon. 

“I am not familiar with statistics, but I know there is a lot of litigation under the FLSA [in New York], as there is in every major urban state with lots of retail employment, because employer failures to pay minimum wage and overtime are a recurrent problem in retail (including fast-food restaurants),” he told Legal Newsline.

According to Carter’s opinion, the job description for an apprentice position includes “leading the restaurant’s team in successful day-to-day operations [and] acting as GM when GM is not present.” 

Based on the job description and a consultant’s recommendation, Chipotle determined that the position should be classified as exempt from overtime pay nationwide. The plaintiffs filed their complaint on behalf of all Chipotle apprentices.

Chipotle, meanwhile, was “adamant that Chipotle’s blanket classification, singular job description, and nationwide policies are irrelevant,” reads the opinion. “Defendants contend that the court should instead focus on the individual testimony of the class members, which shows apprentices are given discretion to deviate from corporate policies and guidelines which results in varying duties actually performed by apprentices.”

Because certification requires the plaintiffs to be representative of the class, each member is required to make similar claims. Chipotle focused on showing that this was not the case, arguing, for example, that some employees claimed that they did not take part in hiring employees, while others said they did participate. 

Carter’s opinion notes that “The record evidence shows that the differences in the structures of Chipotle locations, sales volume, and managerial styles across the country affected the amount of time apprentices spend performing managerial tasks.” 

Therefore, because there were so many variations in job duties between plaintiffs, Carter granted Chipotle’s motion to decertify the collective action.

On May 19, the plaintiffs firms Outten & Golden, Fitapelli & Schaffer and Shavitz Law Group filed their motion asking Carter to certify his order.

They argue his decision has an important impact on the prosecution of the lawsuit, rending it controlling, while raising questions about FLSA collective actions that the Second Circuit has yet to address.

“Appealing is very expensive for private plaintiffs. Getting the N.Y. State or U.S. Department of Labor to take a case is the most likely way an issue can get to the appeals stage,” Leonard said. 

“Individual FLSA cases would be quite unusual, since the amount at stake would usually not be sufficient to finance the litigation. This is why the ability to bring class actions is essential to effective judicial enforcement of the FLSA.”

Similarly, filing the cases by state seems unlikely to help the plaintiffs’ efforts.

“Geography is only part of the issue,” Leonard explained. 

“The problem is that it is difficult to attack even apparently systemic violations of the FLSA (as well as Title VII and other workplace statutes) when you are talking about employers like the fast food restaurants or the national retail chains.

"If the law firm representing Chipotle was able to convince the court that there was so much variation as to the job duties of these ‘apprentices’ between different restaurants to make a class action inappropriate, filing class actions by state would not really be feasible unless the plaintiffs could show that there was substantial uniformity as to the job duties within a state.”

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