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MacDonald v. Covenant Testing Technologies, LLC

United States District Court, D. Colorado

April 18, 2019

JORDON MACDONALD, on behalf of himself and all similarly situated persons, Plaintiff,
v.
COVENANT TESTING TECHNOLOGIES, LLC, Defendant.

          ORDER ON PLAINTIFF'S MOTION FOR APPROVAL OF HOFFMAN-LAROCHE NOTICE (DKT. #24)

          N. Reid Neureiter United States Magistrate Judge.

          This matter is before the Court on Plaintiffs Motion for Approval of Hoffman-LaRoche Notice (Dkt. #24). This case was directly assigned to the undersigned Magistrate Judge pursuant to D.C.COLO.LCivR 40.1(c), and the parties consented to Magistrate Judge jurisdiction pursuant to D.C.COLO.LCivR 40.1(c) and 28 U.S.C. § 636(c) (Dkt. #9).

         The Court has reviewed and carefully considered Plaintiffs motion (Dkt. #24), Defendant's Response in Opposition (Dkt. #26), Plaintiffs Reply (Dkt. #27), and the exhibits attached to these briefs. The Court also heard oral argument at a hearing held on April 10, 2019 (Dkt. #28), has taken judicial notice of the Court's case file, and considered the applicable Federal Rules of Civil Procedure, statutes, and case law.

         Being fully informed, and for the reasons discussed below, it is ORDERED that Plaintiff's Motion is GRANTED in part and DENIED in part without prejudice.

         I. Background [1]

         Defendant Covenant Testing Technologies, LLC ("Covenant") is an oilfield service company that provides flowback and well-testing services in Colorado and Texas. Plaintiff Jordan MacDonald is a former Covenant employee who provided testing services primarily in Weld County, Colorado.

         According to Mr. MacDonald, he frequently was required to work more than twelve (12) hours each day and/or more than forty (40) hours each work week, but was not compensated at the time and a half rate for all of his overtime hours, as required under the Fair Labor Standards Act, 29 U.S.C. §§ 201-219 ("FLSA"). Mr. MacDonald alleges that other current and former Covenant employees, who are similarly situated to him, also were not properly compensated for all of their overtime hours in violation of the FLSA. He thus seeks certification of an FLSA "opt-in" collective action pursuant to 29 U.S.C. § 216(b) to recover damages and backpay for all such employees.[2]

         Mr. MacDonald has identified two specific Covenant overtime pay policies that allegedly violate the FLSA. First, he asserts that Covenant paid him and other employees a "per diem" amount in excess of their reimbursable business expenses, and that this per diem was actually additional compensation that should have been included in his and other employees' overtime rate. Second, Mr. MacDonald alleges that Covenant failed to properly calculate his and other employees' overtime hours. Specifically, Mr. MacDonald alleges that Covenant required him to pick up and drop off fellow workers, and drive them to and from worksites, but failed to pay him overtime for this pre- and post-shift drive time.

         II. Legal Standard

         The FLSA governs the payment of minimum wages and overtime compensation between an employer and its employees. See 29 U.S.C. §§ 206-207. Under the FLSA, a covered employer must pay its employees for the time that it employs them, and generally requires covered employers to compensate employees for work exceeding forty hours in a work week, or twelve hours in any given day. See 29 U.S.C. §§ 206(a), 207(a). The required overtime compensation is one and one-half times an employee's "regular rate" of pay. 29 U.S.C. § 207(e).

         Section 216(b) of the FLSA authorizes private individuals to recover damages for violations of minimum wage and overtime provisions. It provides, in relevant part, that "[a]n action to recover the liability [for unpaid overtime compensation, retaliation, and liquidated damages] may be maintained against any employer... in any Federal or State 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). The FLSA thus gives plaintiffs the opportunity to proceed collectively; which, in turn, allows "plaintiffs the advantage of lower individual costs to vindicate rights by the pooling of resources." Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 170 (1989) (interpreting the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. §§ 621-634, which explicitly incorporates the collective action provisions of the FLSA).

         Unlike class action members under Fed.R.Civ.P. 23, plaintiffs who wish to participate in a FLSA collective action must expressly opt in to the action in writing. 29 U.S.C. § 216(b) ("No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought."). See also In re Am. Family Mut. Ins. Co. Overtime Pay Litigation, 638 F.Supp.2d 1290, 1298 (D. Colo. 2009). "FLSA action claimants [also] retain the right to separately pursue their rights and are only bound by the outcome of the collective action if they expressly choose to join in the litigation." Slaughter v. Sykes Enterprises, Inc., No. 17-CV-02038-KLM, 2018 WL 1556881, at *1 (D. Colo. Mar. 12, 2018) (citing Genesis Healthcare Corp. v. Smith, 569 U.S. 66, 74(2013)).

         In Thiessen v. General Electric Capital Corp., the United States Court of Appeals for the Tenth Circuit ("Tenth Circuit") approved a two-step, case-by-case process, known as an ad hoc approach, for determining whether putative collective members are "similarly situated" to the named plaintiff. 267 F.3d 1095, 1105 (10th Cir. 2001).[3]Pursuant to this approach, at the initial "notice stage"-where we are in this case-the trial court determines whether the plaintiff has asserted "substantial allegations that the putative class members were together the victims of a single decision, policy, or plan." Id. at 1102 (also noting that, "[u]nfortunately, § 216(b) does not define the term 'similarly situated.'"). The Thiessen court concluded that "[a]rguably, the ad hoc approach is the best. . . because it is not tied to the Rule 23 standards." Id. at 1105.

         During the second stage-which is "[a]t the conclusion of discovery," and "often prompted by a motion to decertify"-the court applies a stricter standard to determine whether the action should continue as a collective action. Id. at 1102-03. At the second stage, the "court reviews several factors, including '(1) disparate factual and employment settings of the individual plaintiffs; (2) the various defenses available to defendant which appear to be individual to each plaintiff; (3) fairness and procedural considerations; and (4) whether plaintiffs made [any required filings] before instituting suit.'" Id. at 1103 (quoting Vaszlavik v. Storage Tech. Corp., 175 F.R.D. 672, 678 (D. Colo. 1997)).

         Numerous courts in this District have followed this ad hoc approach in determining whether plaintiffs can move forward collectively under the FLSA. See, e.g., Baldozier v. American Family Mut. Ins. Co., 375 F.Supp.2d 1089, 1092 (D. Colo. 2005); but see Turner v. Chipotle Mexican Grill, Inc., 123 F.Supp.3d, 1300, 1309 (D. Colo. 2015) (rejecting the two-step ad hoc process in favor of an approach that "presumptively allow[s] workers bringing the same statutory claim against the same employer to join as a collective, with the understanding that individuals may be challenged and severed from the collective if the basis for their joinder proves erroneous.")[4]

         III. Analysis

         A. Conditional, Initial Certification-the "Notice Stage"

         This case is at the initial "notice stage." By seeking approval of his proposed Hoffman-LaRoche Notice, Mr. MacDonald is asking the Court to conditionally certify this case as a collective action pursuant to ยง 216(b) of the FLSA. With respect to initial or conditional certification, the court determines whether plaintiffs are similarly ...


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