Case Information
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
ERIC FREELAND, individually and on behalf of
all others similarly situated,
Plaintiff, Case # 22-CV-6415-FPG v. DECISION AND ORDER FINDLAY’S TALL TIMBERS DISTRIBUTION
CENTER, LLC d/b/a OHIO LOGISTICS,
Defendant. INTRODUCTION
On September 28, 2022, Plaintiff Eric Freeland filed this putative wage-and-hour class action against Defendant Findlay’s Tall Timbers Distribution Center, LLC d/b/a Ohio Logistics. See generally ECF No. 1. [1] On January 11, 2023, Defendant moved to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). ECF No. 8. Plaintiff filed his response on February 8, 2023, ECF No. 12, and Defendant replied on March 1, 2023, ECF No. 15. As explained below, Defendant’s Motion to Dismiss is GRANTED in part and DENIED in part.
BACKGROUND
Defendant is an Ohio-based company that provides warehousing and logistical support services throughout the eastern United States. ECF No. 1 ¶ 2. [2] From April 2021 through April 2022, Defendant employed Plaintiff at one of its warehouses in Painted Post, New York. Id. ¶ 55. Plaintiff’s duties involved, among other things, lifting and carrying equipment and freight, operating heavy machinery, and breaking down ceramic parts by hand. Id. ¶ 58.
Defendant paid Plaintiff an hourly wage, and he received his paychecks on a biweekly basis. Id. ¶¶ 4, 7. Defendant also paid Plaintiff bonuses, including attendance bonuses. Id. ¶ 5. Plaintiff often worked more than forty hours per week and earned overtime pay for doing so. Id. ¶¶ 56-57. His overtime rate reflected one and one-half times his usual hourly rate, but did not reflect the bonuses that he received during the relevant pay periods. ; see ECF No. 1-1.
On September 28, 2022, Plaintiff filed this putative class action against Defendant alleging violations of the Fair Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”). See generally ECF No. 1. He alleges that (1) Defendant violated the FSLA by failing to include non- discretionary bonuses in the rate of pay used to calculate his overtime rate; (2) Defendant violated the NYLL for the same reason; (3) Defendant violated NYLL § 191(1)(a) by paying him on a biweekly basis; and (4) Defendant violated NYLL § 195(3) by providing wage statements that inaccurately stated the overtime rate to which he was entitled. See id. ¶¶ 68-72, 73-76, 77-80, 81- 83.
Plaintiff seeks to bring his FSLA claim on behalf of himself and all similarly situated persons who work or have worked for Defendant as hourly workers (the “FSLA Collective”). ECF No. 1 ¶ 33. Plaintiff seeks to bring his NYLL claims on behalf of himself and all persons who worked for Defendant as hourly workers in New York between February 9, 2016, and the date of final judgment in this matter. Id. ¶ 45.
On January 11, 2023, Defendant moved to dismiss the complaint in its entirety for lack of subject matter jurisdiction and for failure to state a claim on which relief can be granted. See ECF No. 8. Defendant has also moved, in the alternative, to strike any class claims outside of the period of Plaintiff’s employment. ECF No. 8-4 at 26-27.
LEGAL STANDARDS
I. Rule 12(b)(1)
“A case is properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1)
when the district court lacks the statutory or constitutional power to adjudicate it,”
Makarova v.
United States
,
II. Article III Standing
Article III restricts federal courts to the resolution of cases and controversies.
Davis v. Fed.
Election Comm’n
,
III. Rule 12(b)(6)
To succeed on a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the
defendant must show that the complaint contains insufficient facts to state a claim for relief that is
plausible on its face.
Bell Atl. Corp. v. Twombly
,
DISCUSSION
Defendant asks the Court to dismiss Plaintiff’s Complaint in its entirety. ECF No. 8-4 at 2. With respect to Plaintiff’s overtime claims, Defendant asserts that Plaintiff has failed to allege a plausible overtime claim under both federal and New York law. Id. at 21-22. With respect to Plaintiff’s untimely pay claim under NYLL § 191(1)(a), Defendant seeks dismissal on three grounds: (1) that Plaintiff has failed to allege an injury-in-fact sufficient to support standing; (2) that the relevant statute does not provide for a private right of action; and (3) that Plaintiff has failed to plausibly allege that he was a manual worker to whom the statute applies. at 8-19. Defendant seeks dismissal of Plaintiff’s wage statement claim under NYLL § 195(3) for lack of standing on the grounds that Plaintiff has failed to sufficiently allege an injury in fact. Id. at 7-8. Defendant also argues that Plaintiff does not have standing to represent a class with claims arising outside of the period of his employment. Id. at 23-24. The Court considers each argument in turn.
I. Federal and State Overtime Claims
Plaintiff alleges that during his employment, he frequently worked over forty hours per week and that Defendant did not include certain non-discretionary bonuses when calculating his overtime rate in violation of the FSLA and the NYLL. ECF No. 1 ¶¶ 57, 70-71, 74-75. Defendant contends that Plaintiff’s federal and state overtime claims should be dismissed because he has failed to adequately allege that Defendant improperly excluded a bonus in calculating his overtime rate or that his overtime pay was improperly calculated. ECF No. 8-4 at 21. The Court disagrees. As explained below, Plaintiff has plausibly alleged a violation of the FSLA and NYLL with respect to Defendant’s calculation of his overtime rate, and Defendant’s motion to dismiss Plaintiff’s federal and state overtime claims is therefore denied.
Under the FSLA, an employer must pay overtime at one and one-half times the employee’s “regular rate” of pay. 29 U.S.C. § 207(a)(1). An employee’s regular rate includes “all remuneration for employment paid to, or on behalf of the employee,” with certain enumerated exceptions. Id. § 207(e). Whether an employer must include a bonus in determining an employee’s regular rate depends on whether the bonus is discretionary or non-discretionary. See 29 C.F.R. § 778.211. A bonus is discretionary, and therefore excludable, if the employer retains discretion as to both the fact of payment and the amount “until a time quite close to the end of the period for which the bonus is paid.” Id. § 778.211(b). Bonuses “announced to employees to induce them to work more steadily or more rapidly or more efficiently or to remain with the firm are regarded as part of the regular rate of pay. Most attendance bonuses . . . are in this category.” § 778.211(c).
New York Department of Labor regulations also require that an employer pay an employee
for overtime at one and one-half times the employee’s regular rate “in the manner and methods
provided in and subject to the exemptions of sections 7 and 13 of [the FSLA].” N.Y. Comp. Codes
R. & Regs. tit. 12 § 142-2.2;
see also Mendez v. Radec Corp.
,
To state a “plausible FLSA overtime claim, a plaintiff must sufficiently allege 40 hours of
work in a given workweek as well as some uncompensated time in excess of the 40 hours.”
Lundy
v. Catholic Health Sys. of Long Island Inc.
,
Here, Plaintiff has adequately pled his federal and state overtime claims because he has
plausibly alleged he worked over forty hours in a given week and that he was underpaid for doing
so.
Lundy
,
Plaintiff also plausibly alleges that Defendant failed to properly calculate Plaintiff’s rate of pay. Contrary to Defendant’s assertion, Plaintiff offers more than a “bare assertion that the bonus was not included in Plaintiff’s regular rate and his overtime pay was improperly calculated.” ECF No. 8-4 at 24. Plaintiff alleges that he received “non-discretionary bonuses, including but not limited to, attendance bonuses.” ECF No. 1 ¶ 5. He further states that his overtime rate during the pay period of May 31, 2021 to June 13, 2021, $21.75 per hour, did not take into account the non- discretionary bonus he earned. Id. ¶ 57; see also ECF No. 1-1 at 2. That rate represents one and one-half times the rate of the hourly rate reflected on his paystub, and does not appear to incorporate the $100.00 bonus for that pay period. ECF No. 1-1 at 2. The overtime rate reflected on his paystub for the pay period of September 20, 2021 to October 3, 2021 likewise does not appear to reflect a bonus he received for that pay period. [3] at 3.
Plaintiff has alleged that (1) he worked more than forty hours in a given week, (2) that he
received a bonus during the relevant period, and (3) that this bonus was erroneously excluded from
the calculation of his regular rate of pay and thus also from his overtime rate. Taken together,
Plaintiff’s allegations and the paystubs attached to the complaint therefore “support an inference
that [he] was not given compensation for [his] hours worked above forty hours at a rate one-and-
a-half times the rate of [his] regular pay.”
Sydorowitz
,
Defendant also takes issue with Plaintiff’s purported allegation that one of the bonuses
improperly excluded from his regular rate is a “referral bonus,” which may be discretionary. ECF
No. 8-4 at 25-26;
see
29 C.F.R. § 778.211(d) (referral bonuses for employees not primarily
engaged in recruiting activities may be discretionary). While one of Plaintiff’s paystubs includes
a $50.00 “RefBonus,” ECF No. 1-1 at 3, Plaintiff does not assert that Defendant should have
included this bonus in his regular rate,
see
ECF No. 1 ¶ 57. Accordingly, to the extent that that
payment may reflect a discretionary bonus that Defendant properly excluded from Plaintiff’s
regular rate, Plaintiff’s allegations regarding the remaining bonuses, the nature of which Defendant
does not appear to contest, are sufficient to support Plaintiff’s overtime claim.
See Sydorowitz
,
In sum, Plaintiff has plausibly alleged that, under the FLSA and NYLL, he was entitled to overtime pay and that Defendant improperly calculated his overtime rate by excluding certain bonuses from the regular rate from which it calculated his overtime rate. Accordingly, Defendant’s motion to dismiss Plaintiff’s overtime claims under the FLSA and NYLL is denied.
II. Late Payment Claim Under N.Y. Labor Law § 191
Plaintiff alleges that because Defendant paid him on a biweekly, rather than weekly, basis, Defendant’s wage payments were untimely under NYLL § 191(1)(a). ECF No. 1 ¶¶ 77-80. Defendant seeks dismissal of this claim on several grounds. Defendant first argues that Plaintiff does not have standing to bring this claim because he has not plausibly alleged an injury-in-fact. ECF No. 8-4 at 8. Defendant then urges the Court to find that NYLL § 191 does not provide a private right of action. Id. at 10-17. In support of this argument, Defendant argues that the canon of constitutional avoidance warrants dismissal. Id. at 19-20. Finally, Defendant argues that Plaintiff has failed to plausibly allege he was a “manual worker,” and therefore that the weekly pay requirement of NYLL § 191 applies to him. Id. at 20-23. As explained below, the Court disagrees with each of Defendant’s arguments and denies its motion to dismiss Plaintiff’s claim under NYLL § 191(1)(a).
A. The Statutory Scheme
Section 191(1)(a) requires employers to pay manual workers “weekly and not later than
seven calendar days after the end of the week in which the wages are earned,” unless the
Commissioner of the New York Department of Labor has authorized the employer to pay the
worker less frequently.
See Gillett v. Zara USA, Inc.
, No. 20-CIV-3734, 2022 WL 3285275
(S.D.N.Y. Aug. 10, 2022). Section 190(4) defines “manual worker” as “a mechanic, workingman
or laborer.” The New York Department of Labor has elaborated on this terse definition, long
interpreting the term to include “employees who spend more than 25 percent of their working time
performing physical labor.” N.Y. Dep’t of Labor Op. Ltr. No. RO-09-0066 (May 21, 2009). The
Department interprets “physical labor” broadly to include a wide range of physical activities. The duties an employee performs, not his title, determines whether he is a manual worker.
See
Gonzalez v. Gan Israel Pre-School
, No. 12-CV-6304,
B. Standing
Plaintiff alleges that Defendant paid him on a biweekly basis in violation of NYLL§ 191. ECF No. 1 ¶ 60-65, 79. Because Plaintiff received some of his wages a week later than he should have, Plaintiff was allegedly “underpaid” and “denied the time-value of his money [and] was unable to invest, save, or purchase utilizing the wages he earned.” ¶ 64. Defendant argues that this “perfunctory allegation” is not enough to plead a concrete and particularized injury capable of supporting standing. See ECF No. 8-4 at 11-13. This dispute therefore centers on whether Plaintiff’s allegation that he “was denied the time-value of his money” and was unable to use his wages to “invest, save, or purchase,” ECF No. 1 ¶ 64, is enough to establish the kind of injury that may confer Article III standing. As explained below, the Court agrees with Plaintiff that it is.
Certain tangible harms, such as monetary harms, “readily qualify as concrete injuries under
Article III.”
TransUnion LLC v. Ramirez
, 141 S. Ct. 2190, 2204 (2021). Accordingly, “if a
defendant has caused physical or monetary injury to the plaintiff, the plaintiff has suffered a
concrete injury in fact under Article III.”
Id.
Although the Second Circuit does not appear to have
determined whether lost time value of money constitutes such an injury, the Seventh, Ninth, and
Eleventh Circuits have all concluded that it does.
See Van v. LLR, Inc.
,
Particularly instructive here is the Eleventh Circuit’s decision in
MSPA Claims 1
. There,
the defendant argued that the plaintiff failed to allege an injury in fact because the plaintiff’s only
injury was “not getting its . . . reimbursement, and that injury disappeared when [plaintiff] was
paid in full.”
MSPA Claims 1
,
The Eleventh Circuit’s decision, along with the Seventh Circuit’s decision in
Habitat
, “reflect the firmly established principle that tort victims should be compensated for loss of use of
money—through either an award of damages or the payment of prejudgment interest.”
Van
, 962
F.3d at 1164. The lost time value of money is therefore “analogous ‘to a harm that has traditionally
been regarded as providing a basis for a lawsuit in English or American courts’—a debtor’s
delinquent payment to a creditor.”
MSPA Claims 1
,
Like the plaintiff in
MSPA Claims 1
, Plaintiff’s alleged injury here stems not just from his
entitlement to his wages, but his “entitlement to receive [those wages]
on time
.”
Where courts have granted motions to dismiss for a lack of injury in fact, they have done
so where the plaintiffs failed to allege any consequence of the delayed payments, alleging no more
than a bare statutory violation.
See e.g.
,
Rath v. Jo-Ann Stores, LLC
, No. 21-CV-791, 2022 WL
3701163, *8 (W.D.N.Y. Aug. 26, 2022);
Rosario v. Icon Burger Acquisition LLC
, No. 21-CV-
4313,
The problem in
Rosario
and
Rath
was not, therefore, as Defendant contends, that the
plaintiffs alleged solely the lost time value of their money, but that they stated nothing more than
a bare violation of the New York statute. In contrast, where a plaintiff has alleged some
consequence of that violation, such as the lost time value of money, there is agreement among
courts in this Circuit that a plaintiff has alleged an injury-in-fact sufficient to establish standing at
the motion to dismiss stage.
See e.g.
,
Petrosino
,
Nevertheless, Defendant contends that the myriad decisions concluding that lost time value
of money is a sufficiently concrete injury to support standing “cannot be reconciled” with Supreme
Court and Second Circuit authority. ECF No. 15 at 8. Pointing to the Supreme Court’s decision
in
Spokeo
, Defendant argues that “[l]isting a range of potential past harms is not the equivalent of
alleging ‘an injury in fact [that is] both concrete and particularized.” (alteration in original).
Defendant appears to assert that, in order to find standing, the Court should require Plaintiff to
describe what exactly he would have used the money for had he received it on time.
See
ECF No.
15 at 9. But this argument sweeps too broadly. It would apply equally to an employee who was,
for example, underpaid for overtime work, but who failed to spell out his “financial strategies or
investment practices that would have increased the value of any funds” or “what, if anything, he
would have done with a given paycheck if he received the amount [due].” ECF No. 8-4 at 12.
Under this view, a plaintiff who did not plead any such plans would have failed to allege an injury
in fact despite not receiving the money to which he was entitled. Because, as the Supreme Court
stated in
TransUnion
, monetary injuries readily qualify as concrete injuries sufficient to confer
standing under Article III,
Also unpersuasive is Defendant’s attempt to recharacterize Plaintiff’s allegation as stating no more than a “nebulous risk of harm.” ECF No. 15 at 9. The Second Circuit decision from which Defendant draws this language, Maddox v. Bank of New York Trust Mellon Trust Co. , 19 F. 4th 58, 65 (2d Cir. 2021), illustrates why. In that case, the plaintiffs alleged that the defendant bank violated a New York statute when it filed a mortgage satisfaction nearly one year after the plaintiffs had paid off their mortgage. Id. at 64. The court laid out several injuries that might arise from such delay: cloud on the title to the property securing the mortgage, payment of duplicative filing fees for the discharge, and reputational harm resulting from the “false appearance that the borrower had not paid the underlying debt and [was] thus more indebted and less creditworthy.” Id. The plaintiffs alleged none of these injuries. Accordingly, the court concluded that:
the [plaintiffs] may have suffered a nebulous risk of future harm during the period of delayed recordation— i.e. , a risk that someone (a creditor in all likelihood) might access the record and act upon it—but that risk, which was not alleged to have materialized, cannot form the basis of Article III standing. at 65. Unlike the plaintiffs in Maddox , Plaintiff does allege that the harm materialized, stating
that he “
was
denied the time-value of his money [and]
was
unable to invest, save, or purchase
utilizing the wages he earned.” ECF No. 1 ¶ 64 (emphasis added). Accordingly, unlike the
potential future harms in
Maddox
, “the loss of the time value of the money owed to [Plaintiff] is
not a harm that
might
occur, but one that
has
occurred; it is not a harm that
might
materialize, but
one that
has
materialized.”
Levy
,
Plaintiff’s allegation that Defendant’s untimely payment in violation of New York law deprived him of the time value of his wages is therefore enough to confer Article III standing. Defendant’s motion to dismiss this claim for lack of subject matter jurisdiction is therefore denied.
C. Private Right of Action Under NYLL § 191
Defendant also challenges an employee’s ability to bring a claim for untimely wage
payments under NYLL § 191(1)(a), arguing that the NYLL does not provide a private right of
action for such claims. Specifically, Defendant urges the Court to reject the First Department’s
decision in
Vega v. CM & Associates Construction Management
,
i. The First Department’s Decision in Vega
In Vega , the plaintiff, a former manual worker, sought to recover liquidated damages, interest, and reasonable attorney’s fees pursuant to NYLL§ 198(1-a) on the grounds that her former employer did not pay her on a weekly basis, in violation of NYLL § 191(1)(a). Vega , 107 N.Y.S.3d at 287. The First Department held first that the term “underpayment” as used in § 198(1-a) “encompasses the instances where an employer violates the frequency requirements of section 191(1)(a) but pays all wages due before the commencement of an action.” Id. The First Department found support for its conclusion in the dictionary definition of “underpay,” which includes to “pay less than what is normal or required.” Id. Under that definition, the First Department concluded that the moment an employer fails to pay manual workers on a weekly basis, “the employer pays less than what is required.” Id. In doing so, it rejected the “defendant’s implicit attempt to read into section 198(1-a) an ability to cure a violation and evade the statute by paying the wages that are due before the commencement of an action.” [4] Id. While an employer may “assert an affirmative defense of payment if there are no wages for the ‘employee to recover,’” that payment “does not eviscerate the employee’s statutory remedies.”
The First Department therefore held that NYLL § 198(1-a) “expressly provides a private
right of action for a violation of Labor Law § 191.”
Id.
at 288. But even if it did not expressly
provide a private right of action, the First Department found that “a remedy may be implied”
because “plaintiff is one of the class for whose particular benefit the statute was enacted, the
recognition of a private right of action would promote the legislative purpose of the statute and the
creation of such a right would be consistent with the legislative scheme.”
Id.
at 288-89 (citing
Sheehy v. Big Flats Community Day
,
Here, plaintiff is a ‘manual worker’ as defined by the statute, and allowing her to bring suit would promote the legislative purpose of section 191, which is to protect workers who are generally “dependent upon their wages for sustenance.” It would also be consistent with the legislative scheme, as section 198 explicitly provides that individuals may bring suit against an employer for violations of the labor laws, even if the Commissioner chooses not to do.
Id.
The only other state appellate court to have considered this issue, the Appellate Term,
Second Department, concluded that because neither the Appellate Division, Second Department
nor the Court of Appeals had pronounced a contrary rule,
Vega
controlled as a matter of
stare
decisis
.
See Phillips v. Max Finkelstein, Inc.
,
ii. The Court of Appeals’ Decision in Konkur
In the absence of conflict among the Appellate Divisions or directly contradictory authority
from the Court of Appeals, Defendant asserts that
Vega
is “irreconcilable” with the Court of
Appeals’ decision in
Konkur v. Utica Academy of Science Charter School
,
As the Court of Appeals explained, “NYLL § 218 also provides for administrative
enforcement of section 198-b by the Commissioner of the Department of Labor. The statute
empowers the Commissioner to grant affected employees restitution and liquidated damages in
addition to imposing civil penalties.”
Konkur
,
While the plaintiff argued that the court should infer a private right of action from NYLL § 198, which allows for attorney’s fees when an employee prevails in a wage claim, the Court of Appeals distinguished NYLL §§ 198-b and 198(1-a). at 3. In doing so, the court noted that, as it had “made clear, the attorney’s fees remedy provided for in section 198(1-a) must relate to ‘wage claims based upon violations of one or more of the substantive provisions of Labor Law article 6.’” Id. (citation omitted). Those provisions include NYLL § 191, which “generally regulates payment of wages by employers and creates reciprocal rights of employees.” Id. (citation omitted).
The court also noted, as does Defendant here, that the legislature had recently amended NYLL § 198 to provide a private right of action for certain notice requirements in NYLL §§ 194 and 195. Id. at 6; ECF No. 8-4 at 17-18. While acknowledging that the nonexistence of an express right of action is not by itself determinative, the court reiterated that the fact that “the legislature chose not to provide a similar remedy for [§ 198-b] is further evidence that it believed that the [statute’s] existing remedies would be adequate.” Id. at 6 (citing Ortiz v. Ciox Health LLC , 37 N.Y.3d 353, 364 (2021)).
The Court is not persuaded that
Vega
is “irreconcilable” with
Konkur
. To start,
Konkur
did not address whether the late payment of wages is an underpayment of wages and therefore a
claim under § 191(1)(a) is a “wage claim” for which a private right of action exists under NYLL
§ 198(1-a). Accordingly,
Konkur
does nothing to undermine the
Vega
court’s conclusion that an
express
private right of action exists for violations of NYLL § 191(1)(a).
See Harris v. Old Navy,
LLC
, 2022 WL 16941712, at *10 (S.D.N.Y. Nov. 15, 2022) (expressing doubts about
Vega
’s
reasoning but ultimately applying its result),
report and recommendation adopted
, 2023 WL
2139688 (S.D.N.Y. Feb. 20, 2023). The closest
Konkur
came to addressing the issue was in its
rejection of one federal court’s conclusion that a claim under NYLL § 198-b is a wage claim.
Konkur
,
The Court therefore joins several other courts in this Circuit in concluding that the Court
of Appeals decision in
Konkur
does not amount to persuasive evidence that the Court of Appeals
would reach a different conclusion than the First Department in
Vega
.
[5]
See Mabe
, 2022 WL
874311, at *7 (“[T]he Court does not read
Konkur
as establishing that the New York Court of
Appeals would reject the conclusions reached in
Vega
.”);
Elhassa
,
iii. Constitutional Avoidance
Defendant also contends that Vega is “incompatible with constitutional considerations.” ECF No. 8-4 at 19. According to Defendant, the remedy Plaintiff seeks for the alleged violation of NYLL § 191(1)(a), including liquidated damages, offends both constitutional notions of due process and the Eighth Amendment’s Excessive Fines Clause. See id. In Defendant’s view, the canon of constitutional avoidance therefore counsels against applying Vega and in favor of dismissal. The Court disagrees.
Even assuming that the damages Plaintiff seeks would be treated as punitive for Due
Process Clause purposes, Defendant’s constitutional challenges are premature.
Rodrigue v.
Lowe’s Home Centers, LLC
,
Moreover, even if Defendant were correct that a liquidated damages award would violate
the Due Process Clause or the Eight Amendment, it has “offered no reason why [it] would be
entitled to dismissal of [Plaintiff’s] claim—rather than a reduction in damages.”
Rodrigue
, 2021
WL 3848268, at *6 (citing
State Farm Mut. Auto. Ins. Co. v. Campbell
,
D. Plaintiff’s Status as a “Manual Worker”
Plaintiff alleges that over twenty-five percent of his work duties were physical tasks, “including but not limited to: (1) lifting and carrying equipment and freight up to 50 pounds; (2) operating heavy machinery; (3) breaking down ceramic parts by hand; and (4) standing for long periods of time.” ECF No. 1 ¶ 58. Defendant argues that this “perfunctory and mechanical” allegation is insufficient to bring Plaintiff within the scope of § 191 because it is a mere legal conclusion and, in any event, those activities are not considered “physical labor” for the purposes of § 191. ECF No. 8-4 at 20-21. Neither assertion is persuasive.
Plaintiff’s allegations are not mere legal conclusions because he has done more than assert
that he is a “manual worker” for the purposes of § 191. Although Defendant correctly notes that
the twenty-five percent figure appears in New York Department of Labor opinion letters, that alone
does not transform Plaintiff’s factual allegations concerning his work duties into a legal conclusion
merely couched as a factual allegation.
See e.g.
,
Guan v. Lash Princess 56 Inc.
, No. 22-CIV-2552,
As to whether Plaintiff’s duties amount to physical labor, the Court concludes that, in
alleging that he engaged in tasks such as lifting and carrying equipment and freight, operating
heavy machinery, and breaking down ceramic parts by hand, he has plausibly alleged that he was
engaged in “physical labor.” The New York Department of Labor has opined that tasks such as
loading and unloading luggage, opening and closing doors, and cleaning vehicles may constitute
physical labor. N.Y. Dep’t of Labor Op. Ltr. No. RO-07-0072 (July 11, 2007). So too may food
preparation, clean-up, hair washing, and hair styling. N.Y. Dep’t of Labor Op. Ltr., No. RO-08-
0061 (Dec. 4, 2008). The tasks Plaintiff alleges appear to be at least as physical as food preparation
or hair styling. Although Plaintiff will ultimately bear the burden of proving that he was in fact
engaged in physical labor and therefore a manual worker, for now, he has “plausibly pled that [he
is] within the bounds of, and protected by, § 191.”
Levy
,
Accordingly, Petitioner’s motion to dismiss on the ground that Plaintiff has failed to adequately allege that he is a manual worker for the purposes of § 191(1)(a) is denied.
E. Conclusion
The Court rejects each of Defendant’s arguments in favor of dismissing Plaintiff’s claim under NYLL § 191. Plaintiff has adequately alleged an injury-in-fact sufficient to establish standing. Defendant has not presented persuasive evidence that the Court of Appeals would reach a different conclusion than that of the First Department in Vega , and its assertion that the canon of constitutional avoidance provides reason to disregard Vega is unpersuasive. Moreover, Plaintiff has sufficiently alleged that he was a manual worker for the purposes of NYLL § 191. The Court therefore denies Defendant’s motion to dismiss Plaintiff’s late payment claim under NYLL § 191.
III. Wage Statement Claim Under NYLL § 195(3)
Plaintiff alleges that Defendant failed to supply Plaintiff with a wage statement accurately listing his lawful overtime rate as required under NYLL § 195(3). ECF No. 1 ¶¶ 66, 82. According to Plaintiff, because the inaccurate wage statements incorrectly stated the overtime rate at which Plaintiff was entitled to be paid, Defendant was able to “continue [its] unlawful wage and hour scheme” without the awareness of Plaintiff and other hourly workers. Id. ¶¶ 14. The Court interprets this to mean that Plaintiff was underpaid for his overtime work at least in part because of the inaccurate wage statements. Defendant argues that Plaintiff has failed to allege that the allegedly inaccurate wage statements caused an injury in fact sufficient to confer Article III standing. ECF No. 8-4 at 10-11. As explained below, the Court concludes that, while Plaintiff’s alleged underpayment may constitute an injury in fact, Plaintiff has not plausibly alleged that this injury is “fairly traceable” to Defendant’s alleged violation of § 195(3).
NYLL § 195(3) requires employers to provide employees wage statements with every payment of wages that list information including the pay period, and, as relevant here, overtime rate or rates of pay. An employee who does not receive wage statements with each payment of wages may recover $250.00 for “each work day that the violations occurred or continue to occur, but not to exceed a total of five thousand dollars.” NYLL § 198(1-d).
The Supreme Court “has rejected the proposition that ‘a plaintiff automatically satisfies the
injury-in-fact requirement whenever a statute grants a person a statutory right and purports to
authorize that person to sue to vindicate that right.’”
TransUnion
, 141 S. Ct. at 2205 (quoting
Spokeo
, 578 U.S. at 341). “Only those plaintiffs who have been concretely harmed by a
defendant’s statutory violation may sue that private defendant over that violation in federal court.” Even where a statute entitles a person to certain information, a deprivation of information,
without more is not enough to establish standing. at 2214 (“An asserted informational injury
that causes no adverse effects cannot satisfy Article III.”) (quoting
Trichell v. Midland Credit
Mgmt., Inc.
,
Courts in this Circuit have therefore held that, without more, technical violations of NYLL
§ 195(3), such as a truncated employer name, a missing phone number, missing gross deductions,
missing gross wages, and even failure to provide the notice at all fail to confer standing.
Perez v.
Postgraduate Ctr. for Mental Health
, No. 19-CV-931,
However, where plaintiffs have alleged that the inaccurate wage statements led to them
being underpaid, some courts in this Circuit have allowed claims under NYLL § 195(3) to proceed.
See e.g.
,
Metcalf v. TransPerfect Translations Int’l, Inc.
, No. 19-CV-10104,
In
Quieju v. La Jugeria Inc.
, by contrast, the court concluded that an allegation that an
employer’s violation of § 195(3) “resulted in the underpayment of wages” is not enough to
establish standing. No. 23-CV-264,
Although Defendant challenges this claim on the basis that Plaintiff has not established an
injury in fact, the Court concludes that the real barrier to standing here is causation—that is,
whether Plaintiff’s alleged underpayment is “fairly traceable” to the allegedly inaccurate wage
statements.
See Quieju
,
However, the Court will grant Plaintiff an opportunity to amend his complaint to replead
his wage statement claim. As the Second Circuit has explained, “the ‘permissive standard’ of Rule
15 ‘is consistent with our strong preference for resolving disputes on the merits.’”
Lorely
Financing (Jersey) No. 3 Ltd. v. Wells Fargo Secs.
,
IV. Standing to Represent the New York Class
Defendant argues that, because Plaintiff “cannot claim to be injured by [Defendant’s] alleged actions before or after his employment, [he] only has standing to represent a class from April 2021 until April 2022.” ECF No. 8-4 at 24. Plaintiff contends that such an argument is not properly adjudicated at this stage of the proceedings, but, should the Court reach the issue, that Plaintiff can adequately represent class members whose claims arise outside of the period in which he was employed by Defendant. ECF No. 12 at 24-26. The Court agrees that Plaintiff has, at this stage, demonstrated that he has standing to represent his proposed class. Defendants motion to strike claims outside of the period of Plaintiff’s employment is therefore denied without prejudice to raising its argument again at the class certification stage.
To establish class standing in a putative class action a plaintiff must plausibly allege “(1)
that he personally has suffered some actual . . . injury as a result of the putatively illegal conduct
of the defendant and (2) that such conduct implicates the same set of concerns as the conduct
alleged to have caused injury to other members of the putative class by the same defendants.”
NECA-IBEW Health & Welfare Fund v. Goldman Sachs & Co.
,
Courts in this Circuit disagree as to whether a district court should conduct this analysis at
the motion to dismiss stage or whether it should reserve the class standing analysis until a motion
for class certification.
See e.g.
,
Buonasera v. Honest Co., Inc.
, 208 F. Supp. 3d 555, 562-63
(S.D.N.Y. 2016) (acknowledging split among district courts in the Second Circuit and concluding
that plaintiff had sufficiently alleged class standing at the motion to dismiss stage);
Petrosino v.
Stearn’s Prods., Inc.
, No. 16-CV-7735, 2018 WL 1614349, at *5 (S.D.N.Y. March 30, 2018)
(collecting cases and declining to consider class standing question where parties did not dispute
plaintiff’s Article III standing). “However, because class standing and class certification are two
distinct inquiries, the Court may properly rule on Plaintiff’s class standing at the motion to dismiss
stage.”
Holve v. McCormick & Co., Inc.
,
Plaintiff satisfies the first prong of the class standing test with respect to his remaining
NYLL claims: his federal and state overtime claims and his late payment claim under NYLL §
191(1)(a). As explained above, he has adequately pled that he “personally suffered an actual injury
from Defendant’s” alleged violations of the FLSA and NYLL.
See Holve
,
Defendant appears to focus its challenge on the second prong, arguing that because Plaintiff
was employed only from April 2021 to April 2022, the class must also be limited to that period.
ECF No. 8-4 at 27. The Second Circuit has not specifically addressed this issue, but some district
courts in this Circuit have limited the temporal scope of class actions under the NYLL to the
employment dates of the named plaintiffs.
See e.g.
,
Maddison v. Comfort Sys. USA (Syracuse),
Inc.
, No. 17-CV-0359,
The Court will not, at this stage in the proceedings, limit the putative New York Class to
hourly workers employed from April 2021 to April 2022. Plaintiff brings his claims under the
NYLL on behalf of a “New York Class” of hourly workers whom Defendant employed between
February 9, 2016 and the date of final judgment in this action. ECF No. 7 ¶ 45. He alleges that
both he and members of the putative New York Class have been injured in the same way, in that
“they have been uncompensated, under-compensated, or untimely compensated due to
Defendant’s common policies, practices, and patterns of conduct” and that those policies and
practices “affected everyone in the New York Class similarly.” ¶ 49. “Defendant’s alleged
failure to comply with the NYLL during the course of [Plaintiff’s] employment plainly implicates
the same set of concerns as [Defendant’s] alleged failure to comply with the NYLL in precisely
the same manner during the unnamed class members’ employment.”
Umbrino
, 585 F. Supp. 3d
at 358. The Court therefore concludes that Plaintiff has adequately alleged standing to bring his
NYLL claims on behalf of the putative New York Class.
See Umbrino
,
Defendant’s motion to strike class claims outside of the period of April 2021 to April 2022
for lack of standing is therefore denied without prejudice. Defendant may raise his arguments
directed at the New York Class at the class certification stage.
See Holve
,
CONCLUSION
For the reasons stated herein, Defendant’s motion to dismiss, ECF No. 8, is GRANTED in part and DENIED in part. Plaintiff’s overtime claims under the FLSA and NYLL and his untimely pay claim under NYLL § 191 may proceed. Plaintiff’s wage statement claim under NYLL § 195(3) is DISMISSED WITHOUT PREJUDICE. Plaintiff is granted leave to amend his complaint to replead his NYLL § 195(3) claim, and, if he chooses to do so, he must file his amended complaint by August 10, 2023. Defendant is directed to answer or otherwise respond to the amended complaint by August 31, 2023.
Defendant’s motion to strike class claims outside of the period of April 2021 to April 2022 is DENIED WITHOUT PREJUDICE.
IT IS SO ORDERED.
Dated: July 11, 2023
Rochester, New York ______________________________________ HON. FRANK P. GERACI, JR.
United States District Judge Western District of New York
Notes
[1] The Court has jurisdiction under 28 U.S.C. §§ 1331, 1332(d), and 1367. The Court has jurisdiction over Plaintiff’s FLSA claim under 29 U.S.C. § 216(b).
[2] Unless otherwise noted, the facts are drawn from the Complaint, ECF No. 1.
[3] Plaintiff’s hourly rate at the time was $14.50. ECF No. 1-1 at 2. An overtime rate of $21.75 reflects one and one- half times that rate, and does not appear to take into account the $100 bonus. With respect to the pay period of September 20, 2021 to October 3, 2021, Plaintiff’s hourly rate was $16.25. ECF No. 1-1 at 3. The overtime rate of $24.375 reflects a rate of one and one-half times that rate, and therefore likewise does not appear to take into account the bonus reflected on the paystub.
[4] Defendant makes a similar argument, describing an employee’s ability to recover liquidated damages for delayed payment as an absurd result. See ECF No. 8-14 at 14-17. The Court rejects this argument for the same reasons that the First Department did in Vega .
[5] Defendant asserts that “this Court is not bound to follow
Vega
and should join certain other courts that have so
declined.” ECF No. 8-4 at 14. It is worth noting that none of the three decisions that Defendant cites did, in fact,
decline to follow
Vega
. They do not even mention
Vega
. In
Zivkovic v. Laura Christy, LLC
, the Southern District of
New York considered and rejected a different decision of the First Department, which involved the application of the
affirmative defenses set forth in NYLL § 198.
See
No. 17-CV-553,