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Brashier v. Quincy Properties, LLC

United States District Court, C.D. Illinois, Springfield Division

April 24, 2018

APRIL R. BRASHIER, CHAD O. LEBOW, and RICHARD M. ORENCIA, individually and on behalf of all persons similarly situated as collective representative under and/or as members of the Collective as permitted under the Fair Labor Standards Act, Plaintiffs,
v.
QUINCY PROPERTY, LLC, doing business as Welcome Inn; VANDIVER MOTEL, doing business as Welcome Inn Columbia; WELCOME INN COLUMBIA; JEFFERSON PROPERTY, doing business as Extended Stay by Welcome Inn; COUNTY LINE PROPERTIES I LLC, doing business as Welcome Inn; AMERICAN MOTELS LLC, doing business as Welcome Inn; B & W INVESTMENT PROPERTIES LLC, doing business as Holiday Apartments; SPRINGFIELD WELCOME INN; and BRETT BURGE; KENNETH LOGAN; QUENTIN KEARNEY; and JOE WIMBERLY, as individuals under FLSA and Illinois Wage Laws, Defendants.

          OPINION

          SUE E. MYERSCOUGH, U.S. DISTRICT JUDGE

         This cause is before the Court on the parties' Joint Motion for Conditional Certification of Collective Action and Court Guidance on Class Notice (d/e 132). For the reasons that follow, the Court grants the Motion, conditionally certifies the class, and directs notice in the form and manner set forth herein.

         I. INTRODUCTION

         Plaintiffs April R. Brashier, Richard M. Orencia, and Chad O. Lebow bring this action under the Fair Labor Standards Act of 1938 (FLSA), 29 U.S.C. § 201 et seq., the Illinois Minimum Wage Law, 820 ILCS 105/1 et seq., and the Illinois Wage Payment and Collection Act, 820 ILCS 115/1 et seq. In Count 1, Plaintiffs seek to bring a claim under the FLSA for unpaid overtime and minimum wages on behalf of themselves and a class of similarly situated employees of Defendants.

         Under the FLSA, employees may bring a collective action against an employer to recover unpaid overtime or minimum wages. 29 U.S.C. § 216(b). Unlike class actions under Federal Rule of Civil Procedure 23(b), where potential plaintiffs are included in the class unless they opt out, potential plaintiffs in FLSA collective actions must affirmatively opt in to the suit. Alvarez v. City of Chi., 605 F.3d 445, 448 (7th Cir. 2010).

         The parties have filed a Joint Motion for Conditional Certification of Collective Action and Court Guidance on Class Notice. The parties have agreed that a conditional collective notice should be issued but have unresolved issues that require the assistance of the Court. The parties specifically note that their stipulation to the notice does not affect Defendants' Motions to Dismiss or Alternative Motions to Transfer Venue or their right to file a motion to decertify this matter as a collective action at a later date. The parties also provide that the stipulation to the notice does not affect Plaintiffs' motion for tolling[1] or any remedies sought under Plaintiffs' complaint. The parties agree that, if the case is not settled after notice to the class and present and former employees opt-in, Defendants retain the right to pursue all of their pending motions to dismiss Plaintiffs' lawsuit and Plaintiffs retain the rights to pursue all possible remedies and recourses. Neither party waives the right to file a motion for summary judgment at the appropriate time nor waives the right to take the case to trial and/or hearing.

         II. THE FAIR LABOR STANDARDS ACT

         Under the FLSA, employees must receive a minimum wage for each hour that they work and an overtime wage for each hour worked in excess of forty hours per week. 29 U.S.C. § 206(a); 29 U.S.C. § 207(a)(1). The FLSA contains several exemptions from these requirements, including the exemptions for “any employee employed in a bona fide executive, administrative, or professional capacity.” 29 U.S.C. § 213(a)(1). Congress has delegated the authority to define the scope of the exemptions to the Secretary of Labor. 29 U.S.C. § 213(a)(1); Kennedy v. Commonwealth Edison Co., 410 F.3d 365, 369 (7th Cir. 2005).

         The Secretary of Labor's regulations define the executive, administrative, and professional exemptions. Job title alone is insufficient to establish an employee's exempt status. 29 C.F.R. § 541.2. Instead, whether an employee is exempt depends on whether the employee's salary and duties meet the regulations. Id.

         First, the employee must be compensated on a salary basis of not less than $455 per week exclusive of board, lodging, or other facilities. See 29 C.F.R. § 541.100 (general rule for executive employees only referring to “salary basis”); § 541.200 (general rule for administrative employees and refers to “salary or fee basis”) § 541.300 (general rule for professional employees and refers to “salary or fee basis”).[2] An employee is considered paid on a salary basis if the employee regularly receives a predetermined amount of compensation on a weekly or less frequent basis and that amount “is not subject to reduction because of variations in the quality or quantity of the work performed.” 29 C.F.R. § 541.602(a). Certain exceptions to the prohibitions against deductions exist; e.g., an employer can make deductions from pay when an exempt employee is absent from work for one or more full days. See 29 C.F.R. § 541.602(b). An employer who makes improper deductions from salary loses the exemption “if the facts demonstrate that the employer did not intend to pay employees on a salary basis.” 29 C.F.R. § 541.603(a). However, an employer who takes improper deductions loses the exemption only for employees in the same job classification working for the same managers responsible for the actual improper deductions. 29 C.F.R. § 541.603(b).

         Second, to qualify for the executive, administrative, or professional exemption, the employee must perform the duties set forth in the regulations. For the executive exemption, the employee's primary duty must be management of the enterprise. 29 C.F.R. § 541.100(a)(2). In addition, the employee must customarily and regularly direct the work of two or more other employees and have “the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees are given particular weight.” 29 C.F.R. § 541.100(a)(3), (4).

         For the administrative exemption, the “primary duty is the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer's customers.” 29 C.F.R. § 541.200(a)(1). In addition, the primary duty for administrative employees includes “the exercise of discretion and independent judgment with respect to matters of significance.” 29 C.F.R. § 541.200(a)(3).

         Finally, an employee is a “professional employee' if her primary duty is the performance of work that requires “knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction” or “invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.” 29 C.F.R. § 541.300(2).

         III. BACKGROUND

         In the Third Amended Complaint, Plaintiffs Brashier, Orencia, and Lebow seek to bring a claim under the FLSA for owed overtime and minimum wages on behalf of themselves and a class of similarly situated employees of Defendants (Count 1). Plaintiffs allege that Defendants have a policy of classifying most of its employees as “salaried” despite those employees having few or no actual salaried work duties. Plaintiffs allege that they and similarly situated employees/former employees were not properly classified as salaried employees because they do not perform “salaried work duties” and/or Defendants lose the exemption due to deductions/compelled payments from salaries and the failure to pay the minimum salary required for salaried employees. See Third Am. Compl. ¶ 2 (d/e 94).

         Plaintiffs seek to bring claims for relief for violations of the FLSA as a collective action on behalf of all misclassified salaried employees. Plaintiffs allege:

Defendants failed to pay overtime wages and other benefits to Plaintiffs and [the] Collective by improperly taking salary deductions and/or failing to maintain salaried work as the “primary duty” for Plaintiffs and [the] Collective and/or paid less than the required minimum salary and/or did not pay for training time.

         Third Am. Compl. ¶ 280. Plaintiffs further allege that Defendants deliberately paid Plaintiffs and the Collective as exempt employees when they knew or should have known of the improper salary deductions, the failure to maintain salaried work as the primary duty, and/or paying Plaintiffs and the Collective less than the required minimum salary. Id. ¶ 281.

         The named Plaintiffs are employees of some or all of the Defendants. See Third Am. Compl. ¶ 278. Plaintiff Brashier was employed as a housekeeper beginning in October 2016 but was classified as exempt and paid a salary. Id. ¶¶ 139, 142, 143, 145. Plaintiff Brashier alleges that she was misclassified as exempt and is owed overtime and minimum wages. Id. ¶¶ 155-166. She also alleges that she was not paid the minimum wage during her “training period.” Id. ¶¶ 177-190.

         Plaintiff Orencia was employed to perform multiple job duties-including housekeeping, maintenance, quasi-security, and front desk clerk-but was classified as exempt and paid a salary. Third Am. Compl. ¶¶ 191, 197-199; see also id. ¶¶ 218-223 and ¶¶ 224-229 (distinguishing between Orencia's “first job” and “second job”). Plaintiff Orencia alleges that he was misclassified as exempt and is owed overtime and minimum wages. Id. ¶¶ 201-214. Plaintiff Orencia also alleges he was not paid the minimum salary required for an exempt classification. Id. ¶ 232 (referring to Orencia's “second job”).

         Finally, Plaintiff Lebow alleges that he was misclassified as exempt and that he was paid less than the minimum wage required for exempt employees. Third Am. Compl. ¶¶ 237-238. Plaintiff Lebow also alleges that his duties did not fall within an exemption. Id. ¶ 246. Lebow placed advertisements on Craigslist for Defendants, performed retail sales functions for American Motels, “assisted in sales/stock of Jefferson Properties, ” responded to customer issues, and assisted in police calls to the property. Id. ...


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