Applebee’s workers who sued their employer for unpaid wages got good news this week: The U.S. Court of Appeals for the Second Circuit has agreed to hear their case. The appellate court will decide whether a lower court erred in denying class-action status to the workers. That means that their case lives on.
The case, Roach v. T.L. Cannon Corp., has national implications for workers and consumers and is being closely watched in the legal community. Public Citizen is representing the workers.
Public Citizen petitioned the Second Circuit in April, contending that a federal district court in New York was wrong to tell the Applebee’s workers that their lawsuit for unpaid wages could not be heard as a class action. The U.S. District Court for the Northern District of New York denied class certification after incorrectly interpreting the March 27 U.S. Supreme Court ruling in Comcast v. Behrend, we maintain.
The outcome of the New York case has national implications for a wide array of pending class-action cases across the country that are being challenged in the wake of the Comcast decision. If the lower court decision stands, and the workers are not permitted to band together to seek back wages that were illegally withheld by their employer, then wage-and-hour laws and other protections for workers and consumers could become prohibitively difficult to enforce.
In the case, filed in May 2010, four Applebee’s workers allege, among other things, that the exclusive Applebee’s franchise operator in New York State violated the state’s “spread of hours” law requiring employers to pay an extra hour’s pay whenever an employee’s work time spans more than 10 hours in a day, and that restaurant managers had a practice of changing time records to reflect breaks that employees did not take. The workers sought certification of a class encompassing current and former Applebee’s workers throughout the state, a group estimated to include as many as 10,000 individuals.
In a March 5, 2013 report, a magistrate judge recommended certification of the class action for the spread-of-hours claim.
But on March 29, two days after the Comcast ruling, the district court rejected the recommendation and denied class-action status. The district court said that, under Comcast, it could not certify a class for which damages would need to be calculated on an individual basis.
Public Citizen’s petition charges that the district court misread Comcast. In Comcast, an antitrust case, both sides agreed that damages needed to be proved on a classwide basis, so the Supreme Court did not even consider whether an individualized measure of damages forecloses class certification in other types of cases or under other circumstances.
“The district court’s interpretation of Comcast contradicts the well-established principle of law that the need to ascertain damages on an individual basis is not by itself sufficient to prevent certification of a class action,” explained Scott Michelman, the Public Citizen attorney handling the case. “If it were, many types of cases would not go forward.”