Mott v. Driveline Retail Merchandising, Inc.

Citations: 23 F. Supp. 3d 483; 2014 U.S. Dist. LEXIS 69520; 2014 WL 2115469Docket: Civil Action No. 12-5244

Court: District Court, E.D. Pennsylvania; May 21, 2014; Federal District Court

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Plaintiffs Lori S. Mott, Cynthia Cotten, Susan Gibbs, Susan Moore, and Judy Ratcliff, representing themselves and others similarly situated, have filed a lawsuit against Driveline Retail Merchandising Inc. for violations of the Fair Labor Standards Act (FLSA), specifically regarding minimum wage and overtime pay. They seek conditional certification of a class of all individuals employed as merchandisers by Driveline in the past three years, an order compelling Driveline to provide contact information for potential class members, authorization for their attorneys to send court-supervised notices, and a 120-day window for class members to join the lawsuit.

The five named Plaintiffs are former hourly-paid employees working as Merchandisers across about 14 states, earning between $8 to $11 per hour. Their job involved various tasks starting from home, including logging into Driveline's intranet to manage work orders, planning routes, and transporting materials to retail locations. They claim they were not compensated for "off the clock" work, specifically for time spent commuting to their first store and for administrative tasks performed at home.

Driveline denies these allegations, asserting that it fully compensates employees for all time worked and that its policy against paying for commute time is legal. The company also claims that the time allocated for each merchandising job includes both administrative and driving time, and employees can request additional compensation if needed.

Under the FLSA's collective action provision, employees can sue on behalf of themselves and similarly situated colleagues, provided they give written consent. Courts in this jurisdiction use a two-step process to assess collective action eligibility. In the initial phase, the named plaintiff must make a "modest factual showing" that proposed class members are similarly situated, requiring evidence of a factual nexus between the employer's alleged policy and its impact on both the named plaintiff and others. This standard is lenient and does not involve evaluating the merits of the claims. If met, the court grants conditional certification for notice and discovery.

In the second phase, after discovery, the court must determine if all opt-in plaintiffs are indeed similarly situated, requiring a heavier burden of proof from the plaintiff. This determination considers various factors, including the individual circumstances of plaintiffs and potential defenses. If the plaintiffs are not similarly situated, the court may decertify the group and dismiss opt-in plaintiffs without prejudice.

In this case, the plaintiffs aim to certify a class of individuals employed by Driveline as merchandisers over the past three years, with approximately 27,095 employees during that time. Five named plaintiffs and about 40 opt-in plaintiffs have joined the lawsuit. Driveline opposes the motion, arguing that the plaintiffs have not identified a common policy violating the FLSA and have not demonstrated that they are similarly situated to the proposed nationwide class.

Plaintiffs allege that Driveline has a uniform policy of not compensating Merchandisers for drive time from home to the first store unless the distance exceeds 30 miles, as stated in the January 2013 Terms of Work Acceptance Policy. They argue this violates the "continuous workday" rule, which mandates that travel time between the start and end of an employee's workday must be compensated. Plaintiffs contend that morning administrative tasks qualify as a principal activity, making the commute compensable. Driveline acknowledges its policy but claims it does not require Merchandisers to log in at home, asserting that the continuous workday rule does not apply. At this stage, the court focuses on whether plaintiffs are similarly situated regarding their claims of policy violation, rather than determining the legality of the policy itself. The plaintiffs have provided sufficient evidence of a nationwide policy against compensating morning drive time.

Additionally, plaintiffs claim that Driveline does not pay for administrative tasks performed before and after work, nor for driving between retail locations during the workday. Driveline compensates based on allocated time for each job, which is supposed to include administrative tasks and travel time as per their Terms of Work Acceptance. The payroll system limits submissions to the pre-established time allocations, reinforcing the plaintiffs' claims of a systemic policy against compensating for certain work-related activities.

Effective September 1, 2011, Driveline implemented a policy prohibiting the acceptance or processing of payroll time exceeding the allotted hours specified in work orders. Plaintiffs assert that they were required to use all allocated time solely for in-store tasks, which prevented them from being compensated for additional time spent on administrative duties and travel between stores. Driveline contends it fully compensates employees for all actual hours worked and requires Merchandisers to obtain prior written approval for any extra hours needed. The company argues that any instances of non-payment for additional time stem from individual misunderstandings of the policy rather than a systemic issue. However, Plaintiffs have provided substantial deposition evidence indicating that both they and proposed class members consistently faced challenges in recording additional hours worked due to the company's payroll system and policy restrictions. Driveline maintains that all Merchandisers are subject to the same policies and that corporate headquarters establishes the time allotments for most jobs, which are not processed if they exceed the client-billable hours.

Dissimilarities in Driveline’s payroll and compensation policies can be evaluated during the second step of certification after discovery, allowing for a better understanding of policy impacts. The court referenced Pereira v. Foot Locker, where conditional class certification was granted despite evidence contradicting the plaintiffs' claims, indicating that such evidence does not preclude preliminary certification. The Third Circuit has noted a lenient standard for determining whether plaintiffs are similarly situated, drawing on Second Circuit precedent. Courts have accepted declarations and deposition testimony demonstrating common job responsibilities among plaintiffs from various cases. In this instance, the plaintiffs have shown they are similarly situated to the proposed class, as Driveline acknowledges that both named and proposed class members are Merchandisers with similar job descriptions and policies. The plaintiffs submitted several affirmations detailing their roles and responsibilities, alongside approximately 40 opt-in plaintiffs expressing interest in joining the class. Driveline's argument that claims are too individualized for collective litigation is insufficient at this stage, as variations in administrative and drive time duties do not negate the existence of similarly situated plaintiffs.

Driveline's defense relates to a stage two decertification issue, relevant after discovery. Evidence suggesting that plaintiffs are not similarly situated to absent class members does not prevent conditional certification. The court conditionally certified a class as the named plaintiffs showed they were similarly situated concerning Driveline's payroll and compensation policies. The class includes all individuals employed by Driveline as merchandisers within three years prior to the lawsuit. Driveline is ordered to provide plaintiffs' attorneys with contact information for potential class members and to facilitate a class notice with a 120-day opt-in period. Specific deadlines were set for Driveline to deliver information and for plaintiffs to send notices to class members. Additionally, plaintiffs must establish a website and a toll-free number for inquiries, and consent forms must be submitted by October 30, 2014. The notice clarifies that this is not a lawsuit against the recipients but informs them of their potential involvement in a collective action lawsuit.

Eligible individuals wishing to participate in the collective action lawsuit against Driveline Retail Merchandising, Inc. must complete and submit the attached 'Consent to Join' form by [DATE]. The lawsuit, initiated on September 12, 2012, in the U.S. District Court for the Eastern District of Pennsylvania, alleges that Driveline failed to pay the Named Plaintiffs and other similarly situated employees for straight-time and overtime wages as required by the Fair Labor Standards Act (FLSA). Key allegations include non-payment for work performed at home and time spent driving between locations. The Named Plaintiffs claim Driveline acted willfully in denying wages, seeking liquidated damages, attorneys’ fees, and costs. Driveline, however, denies these allegations.

The lawsuit is currently in the early stages, with the court conditionally certifying it as a collective action. Employees who worked for Driveline as Merchandisers or related positions after [DATE] and believe they were undercompensated may join by submitting the 'Consent to Join' form, which must be postmarked or faxed by [DATE]. Failure to do so will preclude participation. The FLSA imposes a statute of limitations of two to three years for such claims, necessitating consultation with an attorney if one opts out.

Joining the lawsuit binds participants to the court's judgment on FLSA claims, whether favorable or unfavorable. Participants may need to provide information and potentially testify. They will be represented by the plaintiffs' attorneys without upfront costs, with fees potentially covered by Driveline or a percentage of any awarded judgment or settlement.

Individuals have the option to either join the collective action lawsuit against Driveline Retail Merchandising, Inc. by submitting a 'Consent to Join' form, file their own independent lawsuit, or take no action at all. Joining the lawsuit means that significant decisions regarding the case, particularly related to the Fair Labor Standards Act (FLSA) claims, will be made on their behalf. Not participating in the collective action will not impact an individual’s rights regarding any court judgments. If they do not submit the 'Consent to Join' form, they may still pursue their own claims, but the statute of limitations for filing an independent lawsuit will continue to run. 

Federal law protects participants from retaliation by Driveline or its agents for joining the lawsuit or asserting their rights under the FLSA. Contact information for both the Plaintiffs’ and Driveline’s legal representatives is provided for further inquiries. It is specified that the Court has not taken a position on the merits of the claims or defenses involved. By signing the 'Consent to Join' form, individuals authorize their chosen attorneys to represent them, agree to the fee structure contingent on the success of their claims, and designate the Named Plaintiffs as their representatives to make case-related decisions. The document concludes with a reminder not to contact the Court for information regarding the lawsuit.