Labor & Employment Law

Financial Employees Shot Down In Effort For Class Action

By Mark E. Tabakman, Esq.

In a relatively rare occurrence, but one of special interest to financial services employers a federal judge has rejected an effort by a putative class of Citibank NA employees whose job duties focused on the recruiting of businesses to participate in the company's Bank at Work program. The workers claimed, as usual in these cases, that they were misclassified as exempt.

In a crucial ruling, one that might provide a blueprint for employer defenses of these cases, the court ruled that individual examinations of the duties of many, if not all, of the class members would be required. As 'individuality' is the antithesis of a class action, which is founded on commonality, e.g. a common policy or practice, the motion for class certification was denied.

In this case, docketed as Miranda v Citibank NA, Judge John F. Walter of the U.S. District Court for the Central District of California concluded there were numerous inconsistencies in the motion, which sought to include approximately 100 workers. The job duties of these employees was to locate and then pitch businesses whose employees could possibly seek to utilize/purchase Citibank services. The employees had the same companywide job description, which included recruiting new accounts.

The plaintiff had argued that the administrative exemption did not apply because she did not utilize discretion and independent judgment, which is often the downfall for employers to claim the administrative exemption. The plaintiff argued that all she (and the others) did was 'a series of routinized tasks.'

Under well-established precedent, the court was required to conduct an individual specific study of what each employee did and whether the amount of exempt work performed by each one. This meant, especially, the court needed to determine how much discretion each employee used on the job.

The judge refused to accept blanket, umbrella like allegations that common issues predominated and found that the plaintiff had failed to show the existence of a common policy. To the contrary, the affidavits submitted by both sides demonstrated that the amount of time these employees spent off-site 'varied dramatically from one individual to the next.' Thus, individual analysis of whether each of the one-hundred employees qualified for the outside sales exemption was also necessary.

The lesson for employers defending these cases is clear—attack the 'commonality' contentions and argue that individual scrutiny is called for. If accepted, that defense argument dooms a class action.
 

Full post as published by Wage & Hour - Development & Highlights on August 07, 2009 (boomark / email).