Lindsay v. Cutters Wireline Service, Inc.

          ORDER

          PHILIP A. BRIMMER UNITED STATES DISTRICT JUDGE

         This matter is before the Court on Plaintiff's Motion for Approval of Hoffman-LaRoche Notice [Docket No. 27].

         I. BACKGROUND

         This is a wage and hours dispute. Plaintiff Thad Lindsay worked as a wireline operator for defendant Cutters Wireline Service, Inc. (“Cutters”). Docket No. 22 at 2, ¶ 2; Docket No. 29-1 at 4, ¶ 20. Cutters is the parent company of the other defendants. Docket No. 29-1 at 1, ¶ 3. The president of Cutters is responsible for overseeing all administrative and operational functions of all defendants. Id. at 2, ¶ 4. Defendants provide wireline services to oil and gas production companies in Colorado and other states. Id. at 2, ¶ 5.

         On June 14, 2017, plaintiff filed his complaint. Docket No. 1. The complaint includes claims for violations of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., claims for violations of state wage and hours laws, and a breach of contract claim. Docket No. 1 at 6-9. Plaintiff brings his FLSA claim as a collective action pursuant to 29 U.S.C. § 216(b). Docket No. 1 at 6, ¶ 21. The present motion requests that the Court conditionally certify the collective action and approve the proposed Notice of Collective Action (“Notice”) to be disseminated to the members. Docket No. 27.

         II. ANALYSIS

         A. Conditional Certification

         Plaintiff asks the Court to conditionally certify the case as a collective action pursuant to § 216(b) of the FLSA, which provides in pertinent part:

Any employer who violates the provisions of . . . section 207 of this title shall be liable to the employee or employees affected in the amount of . . . their unpaid overtime compensation, . . . and in an additional equal amount as liquidated damages. . . . An action to recover the liability prescribed in [Section 207] may be maintained against any employer . . . in any Federal . . . court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated.

29 U.S.C. § 216(b) (emphasis added). There is a two-step approach for determining whether plaintiffs are “similarly situated” for purposes of FLSA collective action certification. Thiessen v. GE Capital Corp., 267 F.3d 1095, 1105 (10th Cir. 2001).^[1] A court's initial certification comes at the notice stage, where courts determine whether the putative collective action members are similarly situated for purposes of sending notice to putative members. Id. at 1102. At this first stage, plaintiff is required to provide “nothing more than substantial allegations that the putative class members were together the victims of a single decision, policy or plan.” Id.; see also Stransky v. HealthONE of Denver, Inc., No. 11-cv-02888-WJM-MJW, 2012 WL 6548108, at *4 (D. Colo. Dec. 14, 2012). This is a “lenient” standard, Baldozier v. Am. Family Mut. Ins. Co., 375 F.Supp.2d 1089, 1092 (D. Colo. 2005), “which typically results in conditional certification of a representative class.” Renfro v. Spartan Computer Servs., Inc., 243 F.R.D. 431, 432 (D. Kan. 2007). The second stage, which comes at the conclusion of discovery, applies a stricter standard of “similarly situated, ” including application of at least four factors, to determine whether the case can proceed as a collective action. Thiessen, 267 F.3d at 1102-03.

         Plaintiff seeks to represent a collective action consisting of “all current and former Wireline Operators who worked for any entity associated or affiliated with Cutters Wireline Group at any time from June 14, 2014 to present.” Docket No. 27 at 4. Plaintiff claims that defendants “maintained a pay scheme that resulted in Wireline Operators being underpaid for their overtime work.” Id. at 8. In his complaint, plaintiff alleges that the pay scheme “fail[ed] to compensate employees at ‘time and one-half' their regular rate of pay for all overtime hours worked.” Docket No.1 at 1-2, ¶ 1. Plaintiff alleges he “was required to work overtime hours, and did so frequently, ” but that he “was not compensated at the mandated time and one-half rate for these overtime hours.” Id. at 4, ¶ 12.

         Defendants argue that plaintiff has not set forth substantial allegations that he and other members are similarly situated because he does not explain “how the application of a common overtime policy to Plaintiff and the proposed class members allegedly violated the FLSA.” Docket No. 29 at 6 (emphasis removed). Defendants further argue that plaintiff improperly fails to distinguish between the employees of Cutters and its subsidiaries who “operate separately from one another in different states with separate payroll systems and varying policies.” Id. at 7. The Court finds these arguments unpersuasive. Plaintiff alleges that, under defendants' payroll policies, he was not paid a premium rate for overtime hours worked as required by the FLSA. Docket No. 1 at 4, ¶ 12. Defendants do not indicate any variance between Cutters' policies and those of its subsidiaries that is relevant to plaintiff's claim that defendants did not compensate overtime hours at a premium rate, much less provide any evidence of such a variance. See Docket No. 29-1. In light of the absence of any indication that defendants' pay schemes varied, the Court finds plaintiff's allegations are sufficient to show that defendants' wireline operators were subject to a common payment scheme.^[2]Arfsten v. Cutters Wireline Serv., Inc., No. 16-cv-01919-MSK-KMT, 2017 WL 2400489, at *1 (D. Colo. May 26, 2017) (finding allegations that employees “were subject to the same compensation policies concerning the payment of overtime” were sufficient to show substantial similarity).

         Plaintiff next argues that the Court should deny initial certification because of individualized issues arising under the Motor Carrier Act exemption, 29 U.S.C. § 213(b)(1) (the “MCA exemption”). Docket No. 29 at 9.^[3] Under the MCA exemption, “any employee with respect to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to” 49 U.S.C. § 31502 is exempt from the maximum hours and overtime provisions of the FLSA at 29 U.S.C. § 207(a)(1). 29 U.S.C. § 213(b)(1). “FLSA exemptions are construed narrowly and against the employer” and the “employer has the burden to prove that the exemption applies.” Vallejo v. Garda CL Sw., Inc., 56 F.Supp.3d 862, 868 (S.D. Tex. 2014) (citations omitted). “For the Motor Carrier Act exemption to apply, the employee must: (1) be employed by a motor carrier subject to the Secretary of Transportation's jurisdiction; (2) be engaged in activities directly affecting motor vehicle safety; and (3) be engaged in activities involving the interstate transportation of goods.” Id. (citing 29 C.F.R. § 782.2). Plaintiff argues that it is premature to address this issue at the initial certification stage because claimants have not yet been identified. Docket No. 32 at 3. He also argues that there are likely to be so few opt-in plaintiffs that individualized issues are unlikely to overwhelm the case. Id. at 4. The Court agrees with plaintiff that this issue is premature. See Thiessen, 267 F.3d at 1103 (noting that issues addressed at final certification include the “(1) disparate factual and employment settings of the individual plaintiffs; [and] (2) the various defenses available to defendant which appear to be individual to each plaintiff”). Defendants' arguments are supported by only generalized statements about the nature of the wireline operators' work which are insufficient to show that the MSA exception will present substantial individualized issues. In fact, defendants do not even show that the MSA exemption applies to plaintiff. See Docket No. 29-1 at 3-4, ¶¶ 10-19. “Thus, the question of whether [plaintiff], or indeed any wireline [operator] is exempt from the FLSA's requirements is a matter for another day and does not preclude the issuance of a Hoffmann-LaRoche notice.” Arfsten, 2017 WL 2400489, at *2. The Court finds that plaintiff has provided substantial allegations that the putative collective action members are similarly situated. See Thiessen, 267 F.3d at 1102-03. Therefore, the Court conditionally certifies a collective action consisting of all current and former Wireline Operators who worked for any entity associated or affiliated with Cutters Wireline Group at any time from June 14, 2014 to present.

         B. Notice to ...