Former transport company employee can sue employer, 7th Circuit rules
A former employee of an Evansville-based transportation company who filed a Fair Labor Standards Act action will be allowed to advance her individual claims after 7e The Circuit Court of Appeal ruled that she had the right to do so. However, he declined to address the complexities of his failed collective action.
After two years of working for Professional Transportation Inc., a company that transports railroad crews to and from their jobs, Peggy Jo Smith decided to continue. She filed “individually and on behalf of like-minded people”, arguing that her work had been misclassified for purposes of the Fair Labor Standards Act and that she was not being paid enough for overtime.
FLSA collective action requires group members to affirmatively engage in collective action in order to participate. Over 100 current and former PTI employees have consented to the class action.
But while Smith’s efforts to serve as the appointed representative of a class action lawsuit under the FLSA went well for a while, the pursuit came to a halt when PTI pointed out that Smith had not submitted a additional written consent form indicating their desire to join. own costume.
The United States District Court for the Southern District of Indiana ruled that this was a fatal flaw for the class action and halted any forward movement until Smith files his consent . But by the time the court handed down its ruling, the FLSA’s two-year and three-year limitation periods had run out. When the court then found that Smith’s complaint also failed to address individual claims in a timely manner, it dismissed the case altogether.
Smith appealed the district court’s refusal to allow his individual action to proceed, prompting the 7e Circuit Court of Appeals in a Friday decision to partially separate from the Southern District Court on the issue.
He concluded that the District Court erred in dismissing Smith’s individual claim as well as his collective claims in the case of Peggy Jo Smith v. Professional transport and Ronald D. Romain, 20-2046.
“The question is whether section 216 (b) permits ‘dual capacity’ prosecutions, in which a plaintiff sues simultaneously as a representative of a group and as an individual. The answer is yes, for a number of reasons, ”wrote circuit judge Diane Wood for the 7th circuit.
First, he noted that the District Court erred in finding that the facts alleged in Smith’s second amended complaint only concerned the class action and not his individual claims. Although the captions for the two major sections of his complaint were titled “Collective Action Allegations” and “National Collective Action Pursuant to the FLSA”, the 7e Circuit noted that the first paragraph of the complaint indicated that it was also proceeding on an individual basis.
“We should have passed the stage where the label attached to a group of allegations in a complaint displaces the content taken as a whole”, the 7e Circuit wrote.
He also found sufficient factual allegations related to his individual claims in the second amended complaint that should have “warned PTI that it intended to pursue it both individually and as a representative.”
“The current complaint and subsequent developments in the case indicate that PTI was under no illusions about Smith’s intentions to bring individual claims,” said the 7.e Circuit wrote. “Regardless of what happens to the collective action, it has the right to proceed individually. “
He therefore set aside part of the district court’s summary judgment order and returned with directions to allow Smith’s individual claims to proceed.
Recognizing its decision not to address the complex collective aspect of the Smith case as to whether “one or more named plaintiffs must file a separate written consent form in addition to indicating their desire to proceed collectively in oral argument …” , the 7e Circuit concluded that the state of law on the matter is “far too volatile” for it to comment on the matter.
He took note of the “somewhat awkward language” of 29 USC § 256 (a) in relation to Section 256 (b). The former establishes a rule for specifically named complainants whose written consent to become a complainant is filed with the complaint, while the latter is for unnamed members of the group, he observed.
“We leave for another day the question of whether the law requires that this written consent be in a separate document, or whether it is rather sufficient that the complaint itself clearly indicates the intention of the complainant to proceed collectively,” he said. he wrote, noting that his case law is somewhat inconsistent on whether a separate form should be filed.
“Class actions in the context of the FLSA are relatively common, and we are confident that this issue will come back to us in a fully informed form at some point,” he concluded.