The opinion of the court was delivered by: Judge Joan H. Lefkow
Plaintiffs, Ben Anderson ("Anderson") and Curby Howard ("Howard") (together, "plaintiffs"), individually, and on behalf of all others similarly situated, brought this action against defendants, JCG Industries, Inc. ("JCG"), Koch Meat Co., Inc. ("Koch"), and Joseph C. Grendys ("Grendys") (together, "defendants"), as a class action for violation of the Illinois Minimum Wage Law ("IMWL"), 820 Ill. Comp. Stat. § 105 et seq. (Count I), and, individually, for violation of the Fair Labor Standards Act ("FLSA"), codified at 29 U.S.C. § 201 et seq. (Count II). Defendants have moved to dismiss the complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and Rule 12(b)(6). For the reasons discussed herein, defendants' motion [#8] is granted in part and denied in part.
Anderson and Howard are residents of Cook County, Illinois and worked for JCG and Koch, two Illinois corporations that operate poultry processing plants. Grendys is the president of both corporations and responsible for their pay practices. Plaintiffs worked as poultry processors and seek to represent other employees who worked in similar positions for JCG and Koch and shared similar job titles, pay plans, job descriptions, job duties, uniforms and hours of work. The defendants managed the plaintiffs' work and controlled their wage and hour compensation policies. The plaintiffs were hourly, non-exempt employees and were paid hourly rates between $7.00 and $12.00 per hour.
JCG and Koch employees were required to work five to seven days per week. The first shift was scheduled from 6:00 am to 2:30 pm and the second shift was from 3:00 pm to 11:30 pm; each employee had a scheduled unpaid thirty-minute meal break. Employees were provided with time cards to keep track of time worked and were required to swipe in when they arrived at work and swipe out as they left the production floor. Instead of requiring employees to swipe in and out for meal breaks, the defendants automatically deducted thirty minutes for meal breaks, regardless of whether the entire break was taken. If employees were more than one minute late to the production floor, they were docked pay for fifteen minutes or more.
Plaintiffs allege they regularly worked more than forty hours per week without proper overtime compensation by working before the start of their shifts, through unpaid meal breaks, and after their scheduled shifts. Plaintiffs allege defendants were aware that employees routinely worked more than forty hours per week but failed to accurately record the hours employees worked or properly pay them overtime.
Plaintiffs and defendants were subject to a collective bargaining agreement ("CBA"). Collective Bargaining Agreement, attached as Ex. B to Ex. 1 to Defs.' Mem. Article V of the CBA provides for the calculation of hours worked, including overtime, and Article IX provides an approved grievance procedure. Id. at Arts. V, IX.
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) challenges the court's subject matter jurisdiction. Fed. R. Civ. P. 12(b)(1). The burden of proof is on the party asserting jurisdiction. United Phosphorus, Ltd. v. Angus Chem. Co., 322 F.3d 942, 946 (7th Cir. 2003). In determining whether subject matter jurisdiction exists, the court must accept all well-pleaded facts alleged in the complaint and draw all reasonable inferences from those facts in the plaintiff's favor. Sapperstein v. Hager, 188 F.3d 852, 855 (7th Cir. 1999). "Where evidence pertinent to subject matter jurisdiction has been submitted, however, 'the district court may properly look beyond the jurisdictional allegations of the complaint . . . to determine whether in fact subject matter jurisdiction exists." Id. (quoting United Transp. Union v. Gateway W. Ry. Co., 78 F.3d 1208, 1210 (7th Cir. 1996)) (internal citations omitted).
A motion to dismiss under Rule 12(b)(6) challenges a complaint for failure to state a claim upon which relief may be granted. Fed. R. Civ. P. 12(b)(6); Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1080 (7th Cir. 1997). For the purposes of a Rule 12(b)(6) motion, the court takes as true all well-pleaded facts in plaintiff's complaint and draws all reasonable inferences in the plaintiff's favor. Jackson v. E.J. Brach Corp., 176 F.3d 971, 977 (7th Cir. 1999). "A copy of any written instrument which is an exhibit to a pleading is a part thereof for all purposes." Fed. R. Civ. P. 10(c); Centers v. Centennial Mortgage, Inc., 398 F.3d 930, 933 (7th Cir. 2005). Factual allegations must, however, be "enough to raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed. 2d 929 (2007) (citing 5 C. Wright & A. Miller, Federal Practice and Procedure § 1216, at 235-236 (3d ed. 2004)); see also Ashcroft v. Iqbal, --- U.S. ---, 129 S.Ct. 1937, 1953, 173 L.Ed. 2d 868 (2009) ("Twombly expounded the pleading standard for all civil actions . . . ." (internal quotation marks omitted)). Thus, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Iqbal, 129 S.Ct. at 1949 (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id.
Defendants brought this motion to dismiss under Rule 12(b)(1) or alternatively Rule 12(b)(6). In Count I of the complaint, plaintiffs allege a violation of the IMWL, claiming that defendants "regularly and repeatedly fail[ed] to properly compensate Plaintiffs . . . for the actual time they worked each week," as well as "willfully failed to pay overtime pay and other benefits." Compl. ¶¶ 32, 33. Defendants claim that Count I relates to unpaid wages which "fall squarely within the purview of the [CBA]" and therefore is preempted by Section 301 of the Labor Management Relations Act ("LMRA"). Defs.' Mem. at 5. If preempted, the claim would have to be brought under the LMRA, which requires employees to exhaust grievance and arbitration remedies provided in the collective bargaining agreement before filing suit. Atchley v. Heritage Cable Vision Assocs.,101 F.3d 495, 501 (7th Cir. 1996).
Section 301 of the LMRA completely preempts state claims where a dispute between an employer and labor organization requires interpretation of a collective bargaining agreement's terms. Id. at 499. The statute "confers federal court jurisdiction over disputes that arise out of collective bargaining agreements" and "preempts state law claims that touch on its subject matter." Lopez v. Smurfit-Stone Container Corp.,No. 02 c 7347, 2003 WL 297533, at *2 (N.D. Ill. Feb. 10, 2003). Claims founded on rights created by a collective bargaining agreement or that are dependent on and require analysis of the collective bargaining agreement are preempted. In re Bentz Metal Prods. Co., Inc., 253 F.3d 283, 286 (7th Cir. 2001) (citing Caterpillar Inc. v. Williams, 482 U.S. 386, ...