3:19-cv-00027
W.D. Wis.Jul 14, 2022Background
- Defendant Crush City Construction (d/b/a Lindus Construction) employed ~70–100 non-exempt "Technician Employees" who were paid hourly or by piecework; technicians reported to foremen/managers and used company vehicles for many jobsites located ~45 minutes–2 hours from the shop.
- Crush City issued a Company Manual and a written Drive Time Policy (drafted by counsel) that stated certain drive time was "allowable" and other drive time "not allowable;" employees acknowledged receipt and used Salesforce to submit weekly timecards; managers could review GPS data and reject/require edits.
- Technicians received monthly performance/installation bonuses (non-discretionary, incentive-based); Crush City did not include such bonuses in the regular rate for overtime calculations until late 2019 and issued limited corrective payments for 2018–2019 periods.
- Plaintiff Zachary Morgan worked as a technician (May 2017–Sept 2018), filed suit in Jan 2019 alleging FLSA and Wisconsin wage-law violations; after low FLSA opt-in participation he moved to amend to drop the FLSA collective and add several opt-ins as named plaintiffs, and moved for partial summary judgment and Rule 23 class certification.
- The court granted leave to amend, denied summary judgment on travel-time claims, granted summary judgment as to liability for failing to include nondiscretionary bonuses in the overtime regular rate (damages to be proved), and denied class certification of the proposed Rule 23 classes.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Motion to amend complaint to drop FLSA collective and add named plaintiffs | Morgan sought to abandon the FLSA collective after low opt-in response and add remaining opt-ins as named plaintiffs to conform to the facts | Crush City opposed adding new named plaintiffs (argued prejudice) | Granted: court allowed amendment—no undue delay or bad faith; prejudice not undue |
| Compensability of travel time between shop and jobsite | Morgan argued all travel between shop and jobsite was compensable work time | Crush City argued ordinary home-to-work and shop-to-jobsite commuting (even when employer provides transport or meeting point) is noncompensable unless travel is "part of the day’s work" or "extraordinary" | Denied: summary judgment denied on travel time; routine commuting to/from shop/jobsite is generally noncompensable and plaintiff failed to identify evidence showing the compensable subset (e.g., attendance at meetings or tool pickup) |
| Inclusion of non-discretionary bonuses in regular rate for overtime | Morgan argued performance/installation bonuses were nondiscretionary and must be included in the regular rate when computing overtime | Crush City implicitly conceded (later included bonuses and issued corrective checks for some periods) but argued limited corrective payments and timing | Granted in part: court held Crush City liable for failing to include nondiscretionary bonuses in the regular rate; liability established but damages require proof (checks issued did not resolve liquidated damages/interest) |
| Class certification under Rule 23 for Travel Time and Non-Discretionary Compensation classes | Morgan sought (b)(3) classes for travel-time and nondiscretionary-compensation claims on behalf of all hourly technicians over the relevant period | Crush City argued classes were overbroad, fail-safe, and posed individualized issues (varying travel facts); also challenged Morgan's adequacy as representative | Denied: classes were improper fail-safe and lacked predominance/commonality for travel time; representative adequacy concerns; small FLSA opt-in group made supplemental state-law opt-out class unsuitable |
Key Cases Cited
- Spoerle v. Kraft Foods Glob., Inc., 527 F. Supp. 2d 860 (W.D. Wis. 2007) (summarizing employer's duty to pay for work suffered or permitted)
- Smith v. Aztec Well Servicing Co., 462 F.3d 1274 (10th Cir. 2006) (defining compensable work under FLSA principles)
- IBP, Inc. v. Alvarez, 546 U.S. 21 (2005) (Portal-to-Portal Act governs compensable travel time)
- Pietrzycki v. Heights Tower Serv., Inc., 290 F. Supp. 3d 822 (N.D. Ill. 2017) (employer-provided transportation/meeting point does not automatically render commute compensable)
- Messner v. Northshore Univ. HealthSystem, 669 F.3d 802 (7th Cir. 2012) (rejecting "fail-safe" class definitions)
- Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) (Rule 23 requires rigorous analysis of commonality and predominance)
- Foman v. Davis, 371 U.S. 178 (1962) (standards for granting leave to amend pleadings)
- Chapman v. First Index, Inc., 796 F.3d 783 (7th Cir. 2015) (summary judgment dismissal of FLSA claim does not moot a claim where corrective payment lacks liquidated damages/interest)