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Dayton v. Oakton Community College

United States District Court, N.D. Illinois, Eastern Division

May 17, 2017

BARRY H. DAYTON, individually and on behalf of others similarly situated, Plaintiff,


          MATTHEW F. KENNELLY, District Judge.

         In November 2014, Defendant Oakton Community College announced that, as of July 1, 2015, it would no longer employ annuitants of a pension plan referred to as the State Universities Retirement System (SURS). Plaintiff Barry Dayton, a former part-time faculty member at Oakton, was one of the employees affected by the announced policy. He has sued Oakton, on behalf of himself and a proposed class of similarly situated part-time and adjunct faculty of the college, alleging that the implementation of the policy violates the Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. §623, as well as 42 U.S.C. § 1983 and section 5 of Article XII of the Illinois Constitution. Dayton has named the following individuals as defendants, in addition to Oakton: Margaret Lee, Oakton's president at the time the policy was enacted; Joianne Smith, Oakton's current president and member of the president's advisory council at the time the policy was enacted; and Michael Anthony, Karl Brooks, Maya Evans, Tom Hamel, Collette Hand, Bonnie Lucas, and Mum Martens, the other members of Lee's advisory council at the time the policy was enacted. Two other employees affected by the policy have filed individual suits against Oakland, and their cases have been consolidated with this one.

         Dayton has moved for collective certification of his ADEA claims under 29 U.S.C. § 626(b) and for class certification of his other claims under Federal Rule of Civil Procedure 23. Defendants contend that Dayton cannot meet the certification standards under either the ADEA or Rule 23. For the reasons stated below, the Court grants Dayton's motion.


         Oakton is a two-year community college that employs full-time, part-time, and adjunct faculty to teach the courses it offers. Adjunct faculty are those faculty who teach twenty-seven or fewer "lecture hour equivalents" (LHEs) per academic year. They are covered by a collective bargaining agreement (CBA) between the college and the Oakton Community College Adjunct Faculty Association. Faculty who do not work full time and are not covered by the CBA (because, for example, they teach six or fewer LHEs per academic year) are considered "part-time, " rather than adjunct, faculty. Neither part-time nor adjunct faculty members are eligible for tenure, and the college retains sole discretion in offering them course assignments on a term-by-term basis. In practice, the deans of individual college divisions, with the assistance of department chairs and coordinators, assign courses to adjunct and part-time faculty after the faculty members submit course request forms. A number of factors determine how courses are assigned, including the courses offered in a given academic term, the qualifications of the faculty requesting courses, priority assignment rights, and department needs. Once adjunct and part-time faculty members receive course assignments, they can earn additional compensation by engaging in other activities at the college, such as tutoring or attending meetings.

         SURS is a pension plan that provides retirement benefits to eligible individuals who are or were employed by covered public Illinois state universities or community colleges. Oakton is one of the public community colleges covered by SURS. A number of Oakton's part-time and adjunct faculty members are retirees who previously were employed by Oakton or other covered state universities and began drawing an annuity from SURS upon their retirement.

         Illinois law places earnings limitations on SURS annuitants who return to work for a covered college or university after retirement. Illinois' so-called "Return to Work" law prohibits SURS annuitants who retire prior to age 60 from receiving monthly compensation in an amount greater than their monthly base SURS annuity. If the employee does receive compensation greater than the amount of the monthly annuity, the employee is not entitled to the portion of the annuity provided by employer contributions for that month. See 40 Ill.Comp. Stat. 5/15-139(b). An annuitant who retires at age 60 or over is limited to earning compensation that, when combined with his or her annual retirement annuity, does not exceed his or her highest annual earnings prior to retirement. Id. If an annuitant's compensation is greater than the difference between his or her highest annual earnings prior to retirement and his or her annual retirement annuity, the portion of the monthly retirement annuity provided by employer contributions is reduced by the amount that the compensation exceeds that difference. Id. In 2012, Illinois amended the Return to Work law to place additional earnings limitations on SURS annuitants who return to work for covered colleges and universities. Under the amended law, an employer must pay a financial penalty to SURS if the employer employs an "affected annuitant" after August 1, 2013. See Id. § 15-139.5. An affected annuitant is any SURS annuitant who (1) returns to work for a covered college or university and earns compensation in excess of 40% of his or her highest annual earnings prior to retirement and (2) receives an annualized SURS annuity of at least $10, 000.[1] Id. § 15-139.5(b). The law obligates employers to determine whether its employees are affected annuitants.

         Following passage of the amended Return to Work law, Oakton decided that it would not re-employ any SURS annuitants who became affected annuitants under the law so that it could avoid paying the penalty for employing affected annuitants. Oakton's human resources department monitored the employment and earnings of the SURS-annuitant employees to ensure that none of the annuitants it employed had exceeded the 40% earnings limitation. According to Oakton, the monitoring process was burdensome, and despite the efforts of the human resources department, the college inadvertently employed three affected annuitants after September 1, 2014. As a result of employing the affected annuitants, Oakton was assessed a penalty of approximately $75, 000. After Lee, who was Oakton's president at the time, learned that the college would be assessed the penalty, she met with her advisory council. Lee and the council members determined that, effective July 1, 2015, the college would no longer employ SURS annuitants, whether they were "affected" or not. Martens, the college's executive director of human resources, announced the college's decision on November 13, 2014 in an e-mail to all SURS annuitants who worked for the college. According to Oakton, the new policy would not only prevent the assessment of penalties for employing affected annuitants but would also eliminate the burden of monitoring all annuitants to determine which ones were "affected." Approximately 79 faculty and staff members became ineligible for employment at Oakton as a result of the college's decision.

         It is undisputed that Oakton's decision not to employ SURS annuitants after July 1, 2015 was not based on any annuitant's job performance, class schedule, or availability to teach classes. Rather, the decision not to re-employ SURS annuitants was based on their status as SURS annuitants. According to Dayton, Lee and the advisory council members knew that numerous adjunct and part-time faculty members who were SURS annuitants could never become "affected" annuitants due to caps on adjunct compensation and on the number of LHEs adjunct faculty members could teach but nonetheless determined not to re-employ any SURS annuitants at all.

         Dayton asserts that defendants' decision to terminate the annuitants' employment because of their status as annuitants violated the ADEA and the Illinois Constitution. He has moved to certify the following group as an ADEA collective class and Rule 23 class: "All part time and adjunct faculty who were denied employment at Oakton Community College as the result of its policy to not employ or re-employ State Universities Retirement System annuitants and who are not 'affected annuitants' pursuant to 40 ILCS 5/15-139.5(b)(2)." PL's Br. in Supp. of Class Certif. at 1. Defendants maintain that class certification would be inappropriate because each purported class member's claim is different from the claims of other class members and requires individualized assessment.


         A. Legal standards

         The ADEA authorizes plaintiffs to bring enforcement actions using the procedures provided in the Fair Labor Standards Act, 29 U.S.C. § 216. See 29 U.S.C. § 626(b). Under the FLSA, an employee may bring a so-called "collective action" against any employer on behalf of himself "and other employees similarly situated." Id. § 216(b). As the Seventh Circuit has explained, the only significant difference between a collective action and a Rule 23 class action "is that in a collective action the members of the class (of the 'collective') must opt into the suit to be bound by the judgment or settlement in it, while in a class action governed by Rule 23(b)(3) (a class action seeking damages) they must opt out not to be bound." Espenscheid v. DirectSat USA, LLC, 705 F.3d 770, 771 (7th Cir. 2013). Although the Seventh Circuit has not specified the standard that governs certification of a collective action under the FLSA or ADEA, the court has noted that there is no "good reason to have different standards for the certification of the two different types of action" and that "the case law has largely merged the standards, though with some terminological differences." Id. at 772.

         Class certification under Rule 23 is appropriate if the plaintiff seeking certification meets all the requirements of Rule 23(a) and his case falls within at least one of the categories identified in Rule 23(b). Arreola v. Godinez,546 F.3d 788, 794 (7th Cir. 2008). A purported class satisfies the requirements of Rule 23(a) if: "(1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defense of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class." Fed.R.Civ.P. 23(a). In this case, Dayton maintains that the purported class meets the requirements of Rule 23(b)(3), which requires questions of law or fact common among class members to predominate over questions affecting only individual ...

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