Employer Law Report

Archives: Employment Class & Collective Actions

Subscribe to Employment Class & Collective Actions RSS Feed

Sixth Circuit upholds agreement to arbitrate FLSA claims on individual basis

On Aug. 15, 2018, the Sixth Circuit in Gaffers v. Kelly Services, Inc. held that the Fair Labor Standards Act (FLSA) does not render an arbitration agreement that requires claims to be brought individually illegal and unenforceable. Following the Supreme Court’s recent decision in Epic Systems Corp. v. Lewis, which held that a federal statute does not displace the Arbitration Act unless it includes a “clear and manifest” congressional intent to make individual arbitration agreements unenforceable, the court rejected the plaintiff’s arguments that FLSA displaced the Federal Arbitration Act simply by providing for a right to “collective action.” Instead, the …

U.S. Supreme Court rules that mandatory, individual arbitration of employment disputes trumps employees’ rights to participate in class action lawsuits

On Monday, May 21, 2018, the United States Supreme Court ruled in a 5-to-4 decision that employers may require workers to accept individual arbitration for wage and hour and other workplace disputes rather than banding together to pursue their claims in class actions in federal or state courts. The Court’s decision in Lewis v. Epic Sys. Corp. overturns the position of the National Labor Relations Board (NLRB) and resolves a split among federal courts of appeals. The case is one of the most important employment law cases to be decided by the Supreme Court in the past decade and could …

The OFCCP strikes, puts State Street’s pay inequity problem out on Front Street

Well known asset management company State Street Corporation will pay $5 million to settle allegations of pay inequity raised by the Office of Federal Contract Compliance Programs (OFCCP) in an audit. OFFCP alleged that the company paid female executives less than men and black executives less than whites at its Boston headquarters. The landmark settlement agreement is the largest back pay settlement collected by OFCCP since 2015.

By way of background, OFCCP audits federal contractors and subcontractors for compliance with workplace affirmative action and nondiscrimination requirements. OFCCP conducted a compensation analysis of State Street’s downtown Boston office in December 2012. …

Multi-million dollar high tech settlement of anti-poaching case provides lessons to even much smaller employers

Apple, Adobe, Google, and Intel had a $415 million settlement approved last week to settle the terms of a lawsuit brought by software engineers alleging that the companies had violated wage and anti-trust laws by agreeing not to recruit or “poach” each other’s employees.

The case began in 2009 when the U.S. Department of Justice Antitrust division investigated the employment and recruitment practices of the companies. Then, in 2011, software engineers sued the companies for damages, claiming the companies had agreed to provide each other notice whenever one made an offer to another’s employee.  They also alleged the companies agreed …

Hiring minors: Not my teenage dream

It is summer, and you know what that means: teenagers, everywhere. And they are not just hanging out at the mall, they are working at the mall, at the local pool, and in other entry-level positions. Unlike other workers, however, teenagers come with their own special set of complications. Generational issues aside, the real concern for employers with employment of minors is complying with federal and state laws specific to employment of minors.


Before hiring minors, each employer should verify whether it can hire minor employees in the industry in which the employer operates and the state in which …

Managing religious holidays

Federal and state laws prohibit discrimination and/or harassment on the basis of religion. This means that an employer cannot treat persons of different religions differently or appear to favor one religion over another. As such, employers should be mindful of varying cultural differences among their employees. While their are not as many religious holidays during the summer months, during 2015, the month of Ramadan is celebrated by Muslims from June 17 – July 16.  During this period, Muslims must fast between sunrise and sunset. Keeping that in mind, the following tips may serve as helpful reminders to employers:

  • Keep décor

Hiring seasonal workers during the summer

One issue that comes up for many employers in the summer is hiring seasonal workers. Hiring temporary seasonal employees presents some substantial legal traps for the unwary. Employers should assess their seasonal hiring practices to ensure compliance with various state and federal laws. In other posts, we advised you on the issues in hiring interns and minors, but here are some other issues employers should look out for when hiring seasonal workers:

  • Verify employees are legally permitted to work in the U.S.
  • Make sure you are following the rules when classifying a seasonal worker as an “independent contractor” versus an

No “friending” allowed – final resolution on Gawkers notice of class action participants via social media

We have reported on a federal court’s rulings related to plaintiff’s efforts in Mark v. Gawker Media LLC (S.D.N.Y.) to use social media to notify potential class action members here and here. On April 10 the court held that the class plaintiffs, former interns for the website Gawker, can use social media to notify potential members of their class, with certain restrictions. Plaintiffs are permitted to reach known former Gawker interns via social media with a message that is “substantially similar” to the message contained in traditional forms of notice sent in the case. The court, however, ordered that …

Gawker update: class notification via social media limited

In a previous post, we discussed plaintiffs’ attempt in the class action lawsuit Mark v. Gawker Media LLC (S.D.N.Y.) to notify potential members of the class via social media. On March 5, 2015, U.S. District Judge Alison Nathan took a very limited view of what kind of notification would be permitted when using forums like Reddit, Tumblr, Facebook, Twitter, and LinkedIn. Judge Nathan stated the court’s contemplated use of social media was simply an analogue to the typical mailing of notice and agreed upon use of email. Posts on Reddit and Tumblr must specifically target individuals with opt-in rights, …

Why can’t we be friends? Gawker class action raises specter of notification via social media

Attorneys for FLSA class-action defendant Gawker are opposing plaintiffs’ request to expand potential avenues of class notification via social media. Former interns of the blog site Gawker, a website that promotes itself as a “one-stop guide to media and pop culture,” filed a Fair Labor Standards Act class action against the company in June of last year. Mark v. Gawker Media LLC (S.D.N.Y.). The former interns allege that they were not paid for hours of work writing, researching, editing, and lodging stories and multimedia content that “was central to Gawker’s business model as an Internet publisher.” They also allege …

Two lessons learned from JP Morgan Chase’s recent $1.45 million EEOC settlement

In a widely publicized case, the EEOC obtained a $1.45 million settlement on behalf of female mortgage consultants in Columbus, Ohio who it alleges were subjected to a hostile work environment and denied lucrative sales leads and training opportunities. Employers can learn two lessons from the case: (1) the method of distributing sales leads, customers, and territories should be defensible and (2) litigation holds should be promptly and effectively implemented as soon as litigation is anticipated.

Aimee Doneyhue worked at JPMorgan Chase in Columbus, Ohio as a mortgage consultant, a commission-based sales position. Doneyhue alleged that she was subject to …

Sixth Circuit holds contract clause to arbitrate future claims does not apply to past claims

In Russell v. Citigroup, Inc. the Sixth Circuit held that an agreement to arbitrate “all employment-related disputes” with the company does not include cases already pending in court when the employee signed the arbitration agreement.


From 2004 to 2009, Keith Russell worked at Citicorp’s call center in Florence, Kentucky. As a condition of employment, he signed an arbitration agreement, which covered individual claims but not class actions. In January 2012, Russell filed a class action against the company claiming wage/hour violations. Because the arbitration agreement did not extend to class actions, Citicorp did not seek to arbitrate the class …

Fifth Circuit Court of Appeals Knocks Down NLRB Decision: And, in Doing So, Supports Employer Effort to Avoid Class Action Claims

One of the most significant risks to business in recent years has been the proliferation of class action employment-related lawsuits. Class action claims have been especially popular with plaintiff’s lawyers pursuing federal Fair Labor Standards Act wage claims. A class action lawsuit can mean huge costs for defense and damages. Some employers have attempted to manage the risk by having employees sign agreements requiring that they pursue employment law claims against the company in arbitration, rather than in court. Sometimes employers include in the arbitration agreement a specific waiver of the right to pursue class action claims in court or …

The Sixth Circuit And Ohio Supreme Court Hand Two Major Class Action Wins To Defendants

On November 5, 2013, the Sixth Circuit Court of Appeals and Ohio Supreme Court handed down a pair of class action decisions that are major wins for companies and employers. The Sixth Circuit held that courts, not arbitrators, must decide whether an arbitration clause permits classwide arbitrations—and that an arbitration clause that is silent on the issue bars classwide arbitrations. The Ohio Supreme Court followed recent decisions from the United States Supreme Court and held that trial courts must conduct a rigorous analysis when ruling on class certification, including resolution of factual disputes, factual findings and an examination of the …

Court Denies Employer’s Access to Social Media Posts in FLSA Collective Action and Sends Warning: If You Want Access to Social Media, Come with Both Barrels Loaded … Leave the Water Gun at Home

A federal court has denied a defendant-employer’s request that plaintiffs sift through and turn over all their social media posts made during their work hours in an FLSA collective action in which the plaintiffs claim their employer failed to give them meal breaks. How did that happen? I thought you’d never ask.

By way of background, Jewell v. Aaron’s Inc., is a nationwide,1,700+ FLSA collective action pending in the Northern District of Georgia. In the suit (Complaint accessible here), the class plaintiffs (current and former employees of Aaron’s) claim they were not paid for their 30-minute meal periods. …

United States Supreme Court Adds Further Strength to Class-Action Waivers in Arbitration Clauses

It comes as no surprise that the United States Supreme Court’s decision in American Express Co. v. Italian Colors Restaurant, No. 12-133 (June 20, 2013) is being hailed as a victory by class action defendants. The 5-3 decision authored by Justice Scalia held that a class-action waiver contained in an arbitration clause cannot be invalidated on the ground that the cost to a given plaintiff of proceeding individually on a federal statutory claim would far outstrip the possible recovery to that plaintiff. The Italian Colors decision comes on the heels of the Court’s 2011 decision in AT&T Mobility LLC

You Choose, You Lose! Supreme Court Rules “Arbitrator’s Construction Holds, However Good, Bad, or Ugly” In Upholding Class Arbitration Proceedings

In Oxford Health Plans, LLC v. Sutter, a case addressing an arbitration clause that was silent as to whether it permitted class-wide arbitration, the United States Supreme Court held that so long as an arbitrator’s decision construes the parties’ contract, the arbitrator has not "exceeded his powers" – which would permit a court to vacate the decision under §10(a)(4) of the Federal Arbitration Act (“FAA”) – and the arbitrator’s constructions should be upheld, “however good, bad, or ugly.”

Before we dig into Sutter, we have to go back a little to 2010 when the Supreme Court issued its …

No No No…Not In Our Court. Sixth Circuit Uses Dukes v. Wal-Mart To Block Class Certification and Extends It To Bar Hiring Discrimination Class Claims

In Davis v. Cintas Corp., No. 10-1662 (6th Cir. May 30, 2013), the Sixth Circuit affirmed the denial of a class certification bid in a sexual discrimination hiring case à la Wal–Mart Stores, Inc. v. Dukes and dismissed the plaintiff’s individual disparate treatment claim where the plaintiff claimed she was at least as qualified (if not more so) than male candidates who were hired. By way of key takeaways, Davis demonstrates that the Sixth Circuit endorses Dukes, so much so that it used the United States Supreme Court’s analysis in Dukes, which covered pay and promotion in …

United States Supreme Court Delivers Major Win for Employers – Once Again Raising the Bar for Certifying Class Actions

A bitterly divided United States Supreme Court last week added even more height to the barriers facing plaintiffs who seek to certify their claims as class actions. In Comcast Corp. v. Behrend, No. 11-864, a 5-4 decision penned by Justice Antonin Scalia, the Court held that a district court improperly certified a mammoth class action covering more than two million current and former subscribers of Comcast who claimed to have paid inflated cable bills based upon Comcast’s violation of federal antitrust laws. The decision is particularly notable for its holding that plaintiffs seeking to certify class actions for money …

Employers, Protect Yourself From Class or Collective Actions: New and Developing Case Law is Giving Employers a Number of Proactive Defensive Measures

All too often it seems employers are entirely unaware of the steps they can take to proactively protect themselves from employment litigation. Instead, employers and their attorneys do not address potential issues until litigation has actually been threatened or filed, by which time preventative measures have likely become a moot point. Yet, the law is providing more and more innovative opportunities to strategically protect an employer in ways much cheaper than actual litigation. This protection can reduce an employer’s potential monetary exposure for labor and employment matters by either minimizing litigation or by placing an employer in a position of …

Big Win For Employers – Supreme Court Closes Loophole Used By Plaintiffs’ Lawyers To Defeat Federal Court Jurisdiction Over Class Actions

In a unanimous decision penned by Justice Stephen Breyer, the United States Supreme Court last week closed a loophole in the Class Action Fairness Act (“CAFA”) that had been used by plaintiffs’ lawyers to avoid removal of class actions to federal court. Specifically, the Court held that plaintiffs in class actions cannot stipulate to a recovery of less than $5 million in order to avoid meeting CAFA’s amount-in-controversy requirement.

Under CAFA, enacted in 2005, federal courts have original jurisdiction over class actions in which, among other things, the aggregated value of the claims of individual class members exceeds $5 million. …

Defending an FLSA Auto-Deduct Policy Case Starts with the Foundation — Another Smart Employer with Smart Policies Sends Another Group of Nationwide Plaintiffs Packing

The Northern District of Ohio is the latest in a long line of courts to send the following message to nationwide collective class plaintiffs: Stop seeking nationwide class certification where the plaintiffs are spread across facilities and have too many factual differences to be "similarly situated" and to have experienced a common injury under the Fair Labor Standards Act ("FLSA").

In Creely v. HCR ManorCare, Inc. (N.D. Ohio Jan. 31, 2013), a group of 318 nurses, licensed practical nurses, certified nursing assistants, and admissions coordinators opted into a collective action lawsuit alleging that their employer, HCR ManorCare, Inc. ("HCR"), …

Sixth Circuit Awards Employer Over $55,000 in Costs in FLSA Collective Action

In September, we told you about the Sixth Circuit’s decision in Frye v. Baptist Memorial Hospital, Inc., where the court handed down, not one, but two favorable rulings for employers in an FLSA collective action. First, the court held that automatic pay deduction policies for unpaid meal breaks do not per se violate the FLSA, and that a class representative plaintiff in a collective action must formally opt-in to their own case to "commence" suit and stop the running of the statute of limitations or be barred from suit. Here’s that blog.

After considering the employer’s motion for …

The Sixth Circuit Gives Employers a “Twofer”: An Employer’s Automatic Pay Deduction Policy Does Not Automatically Violate the FLSA and a Class Plaintiff Must “Commence” Suit

In Frye v. Baptist Memorial Hospital, Inc., the United States District Court for the Sixth Circuit handed down not one, but two favorable rulings for employers in an FLSA collective action. First, in considering an automatic pay deduction policy for unpaid meal breaks in a collective action for the first time, the Court held that such a policy does not automatically, or per se, violate the FLSA. Second, a class representative plaintiff must formally opt-in to their own case to "commence" suit and stop the running of the statute of limitations.

1.  The Sixth Circuit Holds that Automatic Pay