Class Action

FedEx Class Action Defense Cases–Babineau v. Federal Express: Eleventh Circuit Affirms Denial Of Class Action Treatment Of Putative Labor Law Class Action Claims Holding Rule 23(b)(3)’s Predominance Requirement Not Met

By Michael J. Hassen

Labor Law Class Action Complaint did not Warrant Class Action Treatment because Individualized Inquiries would Predominate and because Rule 23(b)(1)(A)’s Requirements for Class Action were not Met given Monetary Relief Sought by Plaintiffs Eleventh Circuit Holds

Plaintiffs filed a putative class action against their employer, Federal Express, alleging labor law violations; specifically, the class action complaint alleged that FedEx “failed to pay employees for ‘all hours worked.’” Babineau v. Federal Express Corp., ___ F.3d ___ (11th Cir. July 27, 2009) [Slip Opn., at 2]. According to the allegations underlying the class action complaint, “FedEx has engaged in a pervasive and long-standing policy of failing to pay hourly employees for all time worked.” Id. The class action claimed “FedEx breached their contracts by failing to pay for three categories of time worked: (1) the interval between an employee’s manual punch in time and his scheduled start time; (2) the interval between an employee’s scheduled end time and his manual punch out time; and (3) the time worked during unpaid breaks.” Id., at 3. Plaintiffs moved the district court to certify the litigation as a class action, id., at 2. Originally a class action was filed on behalf of a nationwide class asserting “substantially similar claims,” but the district court denied class action treatment in that case. See Clausnitzer v. Federal Express Corp., 248 F.R.D. 647 (S.D. Fla. 2008). This class action complaint was filed in “[an] attempt[] to address the defects identified in Clausnitzer by limiting the scope of the class to Florida employees, adding a claim for quantum meruit, and altering the theory of their breach of contract claim.” Babineau, at 2-3. As defined, the class action seeks to represent a class that “includes couriers, courier/handlers, service agents, and any other nonexempt employees who are, or were, required during the class period to punch in and out on a manual time clock, but were paid only from their scheduled start time to their scheduled end time.” Id., at 3. The district court again denied class action treatment, holding class certification “was improper primarily because individualized factual inquiries into whether and how long each employee worked without compensation would swamp any issues that were common to the class.” Id. Plaintiffs appealed. The Eleventh Circuit explained at page 2, “The sole question before this Court is whether the district court abused its discretion in declining to certify the class. We hold that the district court acted within the bounds of its discretion and affirm its decision.”

The resolution of this case is very fact-specific, so the Eleventh Circuit spent considerable time on claims and facts supporting and contradicting those claims. See Babineau, at 3-11. We give only a brief summary. The Circuit Court noted that FedEx provides two manuals to its employees – a “People Manual” and an “Employee Handbook.” Id., at 4. Each manual states, “It is the policy of FedEx [] to compensate for all time worked in accordance with applicable state and federal law,” and the People Manual also provides that “[e]xcept for certain approved preliminary and post-liminary activities, no employee should perform work ‘off the clock’ for any reason, whether on their own initiative or at the request of management.” Id. The Eleventh Circuit also explained that FedEx tracks employee time three ways: “First, employees track their time by entering various codes corresponding to different work activities into a hand-held computerized tracking device (a ‘tracker’). Employees manually enter into the trackers their scheduled start times and end times as well as the times at which they start and finish a break…. Additionally, as a backup for the tracker data, employees manually write on a time card the time codes for each task, as well as the start and end time for that task. [¶] FedEx also requires employees to punch in and out on a manual punch clock before and after their shifts. Until 2007 the trackers did not automatically time stamp the employees’ entries, so an employee who was supposed to commence work at 8:00 a.m. but arrived for work at 8:05 a.m. could hide his tardiness by entering an 8:00 a.m. start time into the tracker. Thus, FedEx claims that the manual punch records were simply used to verify the integrity of time entries that employees entered into the trackers. FedEx paid its employees only for the time between the scheduled start and end times as entered into the trackers, which did not necessarily coincide with employees’ manual punch in and punch out times. The periods of time between the start/end times entered into the tracker and the punch in/out times are referred to as ‘gap periods.’” Id., at 5-6.

Full post as published by Class Action Defense Blog on September 15, 2009 (boomark / email).