By Ben JamesLaw360, New York (February 09, 2010) -- The number of new Fair Labor Standards Act
filings in New York and Texas rose in 2009, but neither state came close to rivaling the
volume of new FLSA cases in Florida. Law360 ranked the five busiest federal courts for
wage-and-hour litigation and found the Sunshine State to be a hotbed of plaintiffs bar
activity.
The U.S. District Court for the Southern District of Florida saw 1,252 new FLSA cases show
up on its docket — either through removal, or the filing of a brand new case — in the 2009
calendar year, according to PACER. The Middle District of Florida wasn't far behind, with 776
new filings.
According to Michael Casey, managing shareholder of EpsteinBeckerGreen's Miami office,
just a handful of plaintiffs firms — including Morgan & Morgan PA, the Pantas Law Firm PA
and The Shavitz Law Firm PA — were responsible for the bulk of FLSA filings in the state.
Some of the suits target large companies, but the majority of Florida's FLSA litigation is
aimed at smaller employers, particularly those in the hospitality industry, according to
Casey.
"I would venture to say that the vast majority of restaurants in Florida are violating the
wage-and-hour law with respect to things like tip credit," Casey said.
Big companies have the resources and wherewithal to put up a big fight when sued, so
Florida's wage-and-hour plaintiffs bar has opted for a "volume approach," which entails
bringing a slew of smaller cases against smaller defendants, he said.
"There are so many hidden pitfalls and technical requirements in the FLSA that the smaller
employers are just unaware of," Casey said. "They lack access to sophisticated advice."
Florida is home to a lot of low-wage, hourly workers, and while many companies have
operations in the state, few have headquarters there, meaning that the workers' compliance
with time-keeping policies may not be closely supervised, added Anne Marie Estevez, a
Miami-based partner with Morgan Lewis & Bockius LLP.
The second-busiest venue for FLSA cases is the U.S. District Court for the Southern District
of New York, which logged 361 new filings in 2009. The U.S. District Court for the Eastern
District of New York came a close third, with 300 new wage-and-hour suits.
New York's four district courts saw a combined 695 new FLSA cases in 2009, up from 547
new suits in 2008 and 388 in 2007.
Lawyers pointed to the New York Labor Law's six-year statute of limitations — double the
three-year statute of limitations for a willful FLSA violation — as one factor behind the rise
of FLSA suits in the state.
Plaintiffs in New York are filing hybrid class and collective actions that are lodged in federal
court under the FLSA but include claims under the state's labor law that permit them to take
advantage of that relatively lengthy statute of limitations, attorneys said.
Restaurants in particular have become a frequent target in those suits, said Orrick
Herrington & Sutcliffe LLP partner Tim Long.
Any state that has wage-and-hour laws that go beyond the FLSA in terms of employee
protections naturally piques the plaintiffs bar's interest, explained Long, adding that New
York has not only about 19.5 million residents, but also plenty of plaintiffs lawyers with class
action expertise.
Though some lawyers argue that opt-in collective actions and opt-out class claims are
inherently incompatible, federal courts in New York have generally been receptive to the
concept of hybrid FLSA/NYLL suits, said Tim Selander, an attorney with Nichols Kaster PLLP,
a firm that represents plaintiffs.
"New York courts have been pretty consistent in saying you can bring an FLSA action with a
Rule 23 state law action," Selander said.
Jackson Lewis LLP partner Paul DeCamp added that cases involving hybrid claims were
starting to make their way up to appeals courts, so some meaningful guidance on those
types of cases might be in the cards.
Another factor in the increased number of wage-and-hour actions in New York's federal
courts is the low number of plaintiffs pursuing cases in state courts relative to their
California brethren, attorneys said. That's due in part to the fact that New York's state law
does not give plaintiffs the option of bringing the plethora of pay practice-related claims that
California's labor law does, Selander said.
With such employee-friendly state laws, plaintiffs in California have little incentive to file
wage-and-hour claims in federal court, Estevez noted.
"Some California lawyers have decided they really don't need the FLSA," she said.
The trend is borne out in the statistics, with the number of new FLSA cases filed in the
Golden State's four federal district courts in 2009 totaling just 298, dipping from 351 the
previous year.
However, when both state and federal wage-and-hour suits are taken into account, Florida
and California are on par with respect to the total volume of cases, lawyers noted.
Rounding out the top five busiest federal courts for wage-and-hour litigation is the U.S.
District Court for the Southern District of Texas, with 231 new filings. Statewide, new FLSA
cases rose to 534 in 2009, up from 348 in 2008.
Estevez said members of the zealous and well-organized plaintiffs bar, which lawyers say is
a major force behind the proliferation of wage-and-hour actions in Florida, had now set their
sights on Texas.
Overall, the number of new FLSA cases in federal courts across the country jumped to 6,165
in 2009, up from 5,227 in 2008, according to PACER.
Some lawyers are skeptical that the dramatic jump in wage-and-hour activity over the past
several years can be maintained in the long term, but they expect to keep seeing high levels
of wage-and-hour filings in the short term.
The FLSA, which was written in the 1930s, has gray areas that companies can potentially
exploit to boost profits at the expense of wages, Selander said.
"As long as those gray areas exist, there are going to continue to be more FLSA cases filed,"
he said.
