Court Conditionally Certifies Class and Denies Summary Judgment for Defendant in FLSA Lawsuit Against New York Moving Company

On September 15, 2014, the federal court for New York’s Southern District denied summary judgment for the defendants in the case Gaspar v. Personal Touch Moving, Inc. et al. and authorized plaintiff’s notification of a few dozen potential opt-ins.

In their complaint, the plaintiffs allege several different violations of the Fair Labor Standards Act (FLSA) and corresponding sections of the New York Labor Law (NYLL). They allege (i) that their employer, Personal Touch Moving, Inc. (“Personal Touch”), regularly failed to give employees legally-required minimum wage, overtime, and spread of hours pay, and (ii) that managers of the company illegally retained all tips left by customers for movers and drivers, thereby violating the (informally-established) employment contract. Related claims include illegal deductions in wages for “facial hair penalties” and deductions for the purchase of company uniforms.

In their motion for summary judgment, the Defendants argue that the case should be dismissed under the Colorado River abstention doctrine so as to avoid requiring the court to spend its time and resources on “parallel proceedings” involving “contemporaneous exercise of concurrent jurisdiction” by state and federal courts to decide the same legal questions involving the same parties. The court rejected this argument because the plaintiff in the federal case is not a party to the state case, which implies that these cannot be parallel proceedings in the relevant sense. The legal question is nearly a non-starter.

The court next explained its decision to conditionally certify the class of plaintiffs similarly situated to plaintiff Gaspar, having found that plaintiffs’ presentation of the facts of the case met the minimal burden of presenting actionable claims in their pleadings.

Even if a class of plaintiffs is eventually certified, some of their FLSA claims seem potentially problematic. In particular, the Motor Carrier Exemption (MCA) in the FLSA might make these employees exempt from the requirement of overtime pay. This is one of the defendants’ affirmative defenses in the answer to the complaint. On the other hand, plaintiffs might be able to show that their clients were employees “not engaged in ‘safety affecting activities,'” because they only loaded and unloaded vehicles without being responsible for deciding how safely to distribute the load. Or they might succeed in showing, as they suggest several times in the complaint, that nearly all of the jobs done by plaintiffs were within the state of New York and involved no interstate travel and are thus not subject to the MCA.

On the other hand, if we accept plaintiffs’ accusations about Personal Touch managers keeping tips that customers intended to give movers, these would seem to be clear violations of at least the New York Labor Law:

Section 196-d. Gratuities. No employer or his agent or an officer or agent of any corporation, or any other person shall demand or accept, directly or indirectly, any part of the gratuities, received by an employee, or retain any part of a gratuity or of any charge purported to be a gratuity for an employee.

If you believe your rights under the Fair Labor Standards Act have been violated, please contact The Harman Firm, LLP.