Manning v. Boston Medical Center Corp.
725 F.3d 34
| 1st Cir. | 2013Background
- Four BMC employees (three nurses, one admin) sued BMC and two former executives alleging unpaid wages for work during meal/rest breaks, before/after shifts, and mandatory training, asserting FLSA and Massachusetts common‑law claims and seeking collective/class treatment.
- Plaintiffs alleged BMC used an automated timekeeping system that made meal deductions and policies/operational realities (staffing, deadlines) that forced employees to perform compensable tasks uncompensated, in view of supervisors.
- The district court consolidated related state and federal actions, dismissed the amended complaint in full (finding pleadings conclusory and class allegations implausible), struck class/collective claims, and denied further amendment.
- On appeal the First Circuit vacated dismissal as to the FLSA claim against BMC and against CEO Elaine Ullian, Massachusetts contract and quasi‑contract claims for the nonunion plaintiff (McCarthy), and vacated the striking of class/collective allegations; it affirmed dismissal as to HR director Canavan, fraud/negligent misrepresentation claims, and denial of further leave to amend.
- The court applied Rule 12(b)(6) plausibility standards (Twombly/Iqbal), the FLSA "suffer or permit to work" knowledge standard, the "economic reality" test for individual FLSA liability, and LMRA/CBA preemption/waiver principles regarding arbitration/exhaustion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of FLSA pleadings against BMC (knowledge and compensable work) | Complaint alleges open, uncompensated work during breaks/training, automatic meal deductions, supervisor awareness—plausibly shows BMC "suffered or permitted" work and compensable activities | Allegations are vague/boilerplate, lack specifics on who knew, when, and amounts; thus implausible under Twombly/Iqbal | Vacated dismissal as to BMC: pleadings sufficiently raise plausible inference of employer knowledge and compensable work to survive 12(b)(6) |
| Individual FLSA liability — Elaine Ullian | Ullian, as president/CEO, allegedly participated in budgeting, staffing reductions, policy-setting, hiring/union negotiations and advised on enforcement of policies, supporting inference she controlled compensation/policies | Assertions are boilerplate; title alone insufficient; lack of specific factual link to timekeeping or compensation decisions makes claim implausible | Vacated dismissal as to Ullian: allegations (taken together) plausibly infer operational control sufficient to permit discovery (majority); concurrence would have affirmed dismissal (disagreed) |
| Individual FLSA liability — James Canavan | Complaint alleges Canavan, senior HR director, involved in payroll/records and enforcement | No ownership/high executive status; allegations are bare and do not show control over finances or compensation policy—insufficient under economic‑reality test | Affirmed dismissal as to Canavan: insufficient factual allegations of operational control or causation of undercompensation |
| Class/collective allegations & CBA/arbitrability arguments | Plaintiffs seek collective action (FLSA) and Rule 23 class for nonunion state claims; alleged systemwide timekeeping/practice supports common issues across diverse roles | Defendants: group too heterogeneous; no plausible hospital‑wide policy; union CBAs require arbitration/exhaustion | Vacated striking of class/collective claims: pleadings, if true, support plausible common issues; CBA grievance/arbitration does not show a clear and unmistakable waiver of FLSA rights, so arbitration/exhaustion defense rejected at pleadings stage |
Key Cases Cited
- Pruett v. Caritas Christi, 678 F.3d 10 (1st Cir. 2012) (survey of "hospital compensation" suits and pleading standards)
- Cavallaro v. UMass Memorial Healthcare, Inc., 678 F.3d 1 (1st Cir. 2012) (LMRA preemption and related issues in hospital wage suits)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for Rule 8 pleading)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (application of Twombly plausibility framework)
- Chao v. Hotel Oasis, Inc., 493 F.3d 26 (1st Cir. 2007) (individual FLSA liability where officer controlled employment practices)
- Baystate Alternative Staffing, Inc. v. Herman, 163 F.3d 668 (1st Cir. 1998) (economic‑reality indicia for individual FLSA liability)
- Donovan v. Agnew, 712 F.2d 1509 (1st Cir. 1983) (seminal discussion of corporate officer liability under FLSA)
- O’Brien v. Town of Agawam, 350 F.3d 279 (1st Cir. 2003) (FLSA claims not barred by CBA grievance procedures absent clear and unmistakable waiver)
- Lundy v. Catholic Health Sys. of Long Island Inc., 711 F.3d 106 (2d Cir. 2013) (hospital compensation pleading criticized for vagueness on overtime thresholds)
- Tenn. Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590 (1944) (definition of "work" under FLSA jurisprudence)
- IBP, Inc. v. Alvarez, 546 U.S. 21 (2005) (application of "work" principles under FLSA)