Wage, Hour Class Case Reinstated

One 9th U.S. Circuit Court of Appeals decision slipped by with little notice last week, but it is worth mentioning the court reinstated a wage and hour class action by 500 warehouse workers of a California company that delivers medical products.

The appeals court said that even though the company might have to calculate individual damages for each class member, it could be done easily enough.  So even thought the claims of damages stemmed from four alleged anticompetitive practices, the theory of liability was based on a single alleged anticompetitive practice, so the appeals court allowed class certification.

“Damages determinations are individual in nearly all wage-and-hour class actions,” wrote Judge Harry Pregerson, and damage calculations along cannot defeat certification in the 9th Circuit.

This is the appeals court’s first swing at the U.S. Supreme Court’s decision in Comcast Corp. v. Behrend, which some suggested would prevent individual damage calculations.

Not so, says Pregerson for the panel that included Judges Richard Paez and circuit relative newby Andrew Hurwitz.

Medline makes and delivers medical products at three California warehouses.  It pays low wages to workers so the class claims are less than $10,000 each, averaging about $5,600 per worker.

The workers sued claiming the company did four separate improper things in calculating wages. It rounded hourly worker times in 29-minute increments.  A worker who clocked in at 7:31am would be paid from 8am.  The company allegedly excluded nondiscretionary bonuses from overtime rates, thus lowering overtime pay.

Third, the company owes employees penalty fees from willfully paying wages due to terminated employees for the time-rounding violations, known as waiting time penalties.

Lastly, because of the rounding and bonus violations, the payroll records do not accurately record hours worked and wages earned and thus workers may recover damages up to $4,000 for the violation, according to the opinion.

Even though the damages may be different for each of the 500 class members, Medline showed it could calculate them because it made such calculations when it argued to remove the case from state court to federal court, Pregerson said.

‘Medline’s removal notice thus demonstrates that damage could feasibly and efficiently be calculated once the common liability question are adjudicated,” he wrote.

Case:  Leyva v. Medline Industries, Inc., No.11-56849

With Hat Tip to Sheppard Mullin Employment Law Blog.