18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 447 removal, Defendant assumed a violation rate of four hours of uncompensated overtime, three missed meal breaks, and three missed rest breaks per week. Defendant further assumed violations in 100% of pay periods and $70 in unreimbursed expenses per month. Defendant also offered declarations from its human resources personnel who attested that there were 175 individuals within the scope of the class definition with an average pay rate of $15.35 an hour and a total of 16,666.17 workweeks. Id . at *7. With these figures, Defendant calculated $1,535,287.58 in unpaid overtime, $1,485,122.41 in unpaid commissions and bonuses, $1,534,954.26 in unpaid meal and rest period premiums, $314,370.00 in unreimbursed expenses, $225,950.00 in § 226 penalties, and $451,900 in § 210 penalties. Id . at *8. Defendant thus contended that amount-in- controversy exceeded the $5 million threshold even without accounting for attorneys’ fees and costs. The Court held that Defendant’s assumptions were reasonable and grounded in the allegations of the complaint. The Court therefore ruled that Defendant demonstrated by preponderance of the evidence that the amount-in-controversy exceeded $5 million, and denied Plaintiff’s motion to remand. Marquez, et al. v. Southwire Co., LLC , 2021 U.S. Dist. LEXIS 184652 (C.D. Cal. Sept. 27, 2021). Plaintiff, a former employee, filed a state court class action alleging that Defendant violated various provisions of the California Labor Code. Defendant removed the action to the District Court on the basis of diversity jurisdiction and pursuant to the CAFA. Plaintiff filed a motion to remand, which the Court granted. Plaintiff moved to remand on the ground that Defendant failed to prove that the amount-in-controversy was more than the $5 million jurisdictional minimum under the CAFA. Defendant contended that the amount-in-controversy was $5,618,862.27, excluding attorneys’ fees and interest, which could add 25% or $1,404,715.57. As to the meal period violations, Defendant assumed three meal period violations per week, or a 60% violation rate. Defendant also assumed three rest period violations per week, or a 30% violation rate. Using these rates in reference to the workweeks worked by non-exempt employees during the relevant period, Defendant estimated $1,981,835.94 in damages for meal period violations, and the same amount of damages for rest period violations. Id . at *11. Plaintiff argued that Defendant failed to offer any reason or evidence to support this violation rate. Plaintiff asserted that the "pattern or practice" allegations in the complaint were insufficient to establish a violation rate, and Defendant’s declaration in support of the proposed rates did not include any information about how frequently putative class members missed meal and rest periods, or any records to support its calculations. The Court agreed with Plaintiff’s position. It found that Defendant failed to submit any supplemental declarations or evidence to address the rates selected. Accordingly, the Court concluded that Defendant’ volition rate was not reasonable, and that it had declined to establish an alternative rate for the claims. As to the unpaid overtime compensation claim, Defendant assumed that Plaintiff and the class were not paid one half-hour of overtime wages per workweek, for $495,458.99 in unpaid wages. The Court explained that pertinent case law authorities had repeatedly held that assumptions of one hour of missed overtime per pay period were reasonable, based on Plaintiffs’ allegations of "pattern and practice" violations. Id . at *14. Thus the Court found that Defendant’s calculation of $495,458.99 for unpaid overtime was reasonable. As to Plaintiff’s minimum wage allegations, Defendant added $310,730 to its amount-in-controversy calculations, assuming again a half-hour of off-the-clock work per workweek. Id . at *16. Plaintiff contended that this was improper because the time needed to be considered in the context of whether an employee worked overtime hours that day, or else it would have already been included in the overtime calculation. The Court agreed that Defendant failed to offer any reasonable basis to assume that employees would be entitled to minimum wage damages. Finally, Defendant assumed a violation rate of 100% for failure to issue accurate wage statements and to timely pay wages at the conclusion of employment. The Court held that this assumption was reasonable under Plaintiff’s “pattern and practice” allegations. The Court thus found Defendant’s calculation of $601,800 for wage statement penalties and $402,566.40 for waiting time penalties to be reasonable. Finally, with respect to attorneys’ fees and costs, the Court held that the 25% estimate was reasonable. Accordingly, the Court determined that there was a total amount-in-controversy of $1,874,781.74, including $495,458.99 for overtime claims, $601,800 for wage statement penalties, $402,566.40 for wage statement penalties, and up to 25% of the total, or $374,956.348, for attorneys’ fees. Since the amount was far less than the threshold required by the CAFA, the Court granted Plaintiff’s motion to remand. Maslic, et al. v. ISM Vuzem, 22021 U.S. Dist. LEXIS 206501 (N.D. Cal. Oct. 26, 2021). Plaintiffs, a group of employees who were all residents of Bosnia and Herzegovinia, Slovenia, or Croatia, filed a state court class action asserting 10 claims against Defendants, including: (i) failure to pay minimum wage in violation of the