Supreme Court reviews collective action component of wage theft claims

As employers and management ask for more concessions and higher efficiencies from workers, the number of wage and hour claims has increased over the last ten years. Wage theft can occur in many different occupations from the restaurant and hospitality field to health care and construction.

A case currently before the United States Supreme Court involves an increasingly common situation involving employees who are working through their breaks. The narrow issue before the court is whether a settlement offer made to the nurse who brought the claim can stop a collective action filing asking for relief for her fellow co-workers.

Facts of the case

The company docked each worker for a half-hour meal break. It did not matter whether the staff members actually took the break and many worked through their lunch breaks. One of the nurses, who routinely worked through her lunch break, sued for violations of the wage and hour rules under the 1938 Fair Labor Standards Act. The FLSA provides employees the right to bring a “collective action” against employers who violate the act.

The employer offered to pay $7,500 to compensate the nurse for the earned but unpaid wages. The nurse did not accept the offer. Before the nurse was able to contact other workers, who may have joined as part of a collective action, a federal judge threw out her case. The judge found there was no longer a controversy because the employer offered a full settlement for the individual claim.

The federal appellate court overturned the district court decision noting that an employer cannot “frustrate” potential collective actions by settling with the individual in order to dismiss the entire suit. On appeal to the U.S. Supreme Court, the justices addressed technical procedural details; although several of the justices expressed concerns that the nurse was left with no remedy. The court will issue a written decision later this term in what is expected to be a 5-4 decision with Justice Kennedy providing the critical swing vote.

Purpose of collective action lawsuits

The right to bring collective action under the FLSA allows employees who may each have a very small complaint to join together to seek relief. If the court makes it more difficult for employees to bring class action claims, it will be harder to hold employers responsible when they violate FLSA provisions.

Concerns about pay calculations usually start small. As in this case, it was a half-hour meal break, but over months and years, those small segments of unpaid work add up especially when it is an across the board practice. A consult with an experienced employment law attorney may uncover FLSA violations. A lawyer can also assist you to obtain unpaid wages if there was a violation.