Southern District of New York elaborates on minimum standard for “first step” conditional certification of FLSA class actions – Focus is on whether there are “similarly situated” individuals, not on whether lead Plaintiffs’ claims are likely to succeed.

In a recent decision from earlier this summer, District Judge J. Paul Oetken reviewed in detail the standards for granting preliminary collective action certification in Fair Labor Standards Act or FLSA actions.  Preliminary certification is extremely important because it is this stage that the Court authorizes notice to be sent to “similarly situated” persons who may be interested in “opt-in” to the action.  Unless a simple, clear notice is sent out to as many similarly-situated people as possible,
may potential opt-ins may be unaware of their right to participate, or even of the existence of the collective action. 
Given that the statute of limitations continues to run on their claims until they opt-in, early notice is essential for maximum recovery. 

In the case of Rudy Colon v. Major Perry Street Corp., the plaintiff, Mr. Colon alleged that he worked as a handyman and later a superintendent at various buildings owned and managed by the defendants.  Mr. Colon claimed that he and other were denied minimum wage and overtime compensation while working for defendants.  Mr. Colon further alleged that many of the workers were immigrants with limited English language skills.

On July 2, 2013, Judge Oetken granted Mr. Colon’s motion with respect to a class or collective of superintendents.

Judge Oetken’s decision explained that federal courts within the Second Circuit apply a two-step method of collective active certification of an “opt-in” collective action under the FLSA.

His recent decision is significant because the Judge reviewed many other decisions and comprehensively set out an approach for district court’s to take when considering preliminary or “first-step” collective action certification motions.

Most significantly, the Judge emphasized that at the first or preliminary step, the focus of the Court’s inquiry is not on whether there has been an actual violation of the law, bur rather on whether the proposed plaintiffs are similarly situated with respect to allegations that the law has been violated.  The decision cited an earlier decision for the proposition that the test is whether there is a factual nexus between the claims of the named plaintiff and those who have or might choose to opt-in to the action.

The Court noted that the standard for granting preliminary certification was lenient, and that courts require nothing more than substantial allegations that the putative class or collective members were together the victims of a single decision, policy or plan.

At the first-step, even hearsay statements may be considered in support of preliminary certification.

In contrast, Defendants may not defeat a similarly situated argument by simply submitted management affidavits.  This is because at the first step, the court does not resolve factual issues, decide substantive issues going to the ultimate merits, or make credibility determinations.  Nor does a court weight the merits of the underlying claims in determining whether potential opt-in plaintiffs may be similarly situated. 

The decision further stated that if the plaintiffs demonstrate that similarly situated employees exist, the Court should conditionally certify the class, order that appropriate notice be given to putative class members, and the action should continue as a collective action throughout the discovery process.

The Colon decision is significant because it recognizes that the fundamental purpose of the collective action aspect of FLSA litigation is to give as many affected persons the opportunity to participate in the action.  Given that a high percentage of victims of wage and overtime violations are low-wage,
working class employees without legal training or experience, the prompt dissemination of a clear notice of opt-in rights, to the maximum number of affected people, along with easy to understand instruction on how to opt-in is essential.  Individual claims may be small, and for all practical purposes, may be impossible to pursue outside of the context of collective action litigation.

The Harman Firm, LLP has strong experience leading employees and former employees in litigation against their former employers and in many cases, with very satisfactory settlements.