Morgan v. Rohr, Inc. et al, No. 3:2020cv00574 - Document 105 (S.D. Cal. 2022)

Court Description: Order Granting in Part and Denying in Part Plaintiffs' Motion for Class Certification (ECF No. 56 ). Signed by Judge Gonzalo P. Curiel on 3/31/22. (jmo)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 12 13 NATIONAL MORGAN, an individual; MICHAEL BEVAN, an individual; individually, and on behalf of others similarly situated, ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS’ MOTION FOR CLASS CERTIFICATION Plaintiffs, 14 15 v. 16 18 ROHR, INC., a corporation; HAMILTON SUNDSTRANT, d/b/a COLLINS AEROSPACE; UNITED TECHNOLOGIES CORPORATION, 19 Defendants. 17 Case No.: 20-cv-574-GPC-AHG [ECF No. 56] 20 21 Before the Court is Plaintiffs’ motion for class certification and to appoint class 22 counsel. ECF No. 56. Defendants filed an opposition, and Plaintiffs filed a reply. ECF 23 Nos. 67, 76. With the Court’s approval, Defendant filed a sur-reply. ECF No. 96.1 The 24 25 26 27 28 1 After Plaintiffs filed the Reply, Defendants filed a motion to strike the documents filed concurrently with the reply, or in the alternative, moved the Court for permission to file a Sur-Reply. ECF No. 84. The Court granted Defendants’ request to file a Sur-Reply. ECF 1 20-cv-574-GPC-AHG 1 Court held a hearing on this matter on February 4, 2022. ECF No. 104. After careful 2 review of the parties’ briefs, the record, the applicable law, and counsel’s arguments at 3 the hearing, the Court GRANTS IN PART and DENIES IN PART Plaintiffs’ motion for 4 class certification. 5 Procedural Background 6 Plaintiff Nathaniel Morgan brought this purported class action complaint which 7 alleges Defendants engaged in illegal payroll policies, through which they failed to 8 compensate employees for time worked, failed to provide adequate meal and rest breaks, 9 and other violations of California wage and hour laws, as well as unfair business 10 practices in the Solano County Superior Court. ECF No. 1-2., Compl., at 13-27. On May 11 6, 2019, the action was removed from Solano County Superior Court to the United States 12 District Court for the Eastern District of California, by Defendants Rohr, Inc., Hamilton 13 Sundstrand Corporation d/b/a UTC Aerospace Systems d/b/a Collins Aerospace, and 14 United Technology Corporation (“Defendants”) pursuant to the Class Action Fairness 15 Act of 2005 under 28 U.S.C. § 1332(d). ECF No. 33, Second Amended Complaint 16 (“SAC”) at 2. The case was then transferred to this Court on March 26, 2020. Id. at 3. 17 After the case was removed to federal court, Plaintiffs filed a Second Amended 18 Complaint on June 19, 2020, which is the operative complaint in this action.2 Id. Among 19 other changes, the SAC added a second class representative, Plaintiff Michael Bevan. 20 Compare ECF No. 1-2 with SAC at 3. The SAC alleges eight causes of action: (1) Failure 21 22 23 24 No. 94. Defendants subsequently filed a notice of supplemental authority on December 13, 2021. ECF No. 100. 2 25 26 27 28 Plaintiffs moved for leave to file a third amended complaint on August 5, 2021, after Defendants filed their opposition to Plaintiffs’ motion for class certification. ECF No. 74. The Court denied Plaintiffs motion for leave to file an amended complaint on December 1, 2021. ECF No. 99. 2 20-cv-574-GPC-AHG 1 to Authorize and Permit Required Meal Periods (Cal. Labor Code §§ 226.7, 510, 512, 2 1194, 1197; IWC Wage Order No. 9-2001, § 11); (2) Failure to Authorize and Permit 3 Required Rest Periods (Cal. Labor Code §§ 226.7, 512; IWC Wage Order No. 9-2001, § 4 12); (3) Failure to Pay Overtime Wages (Cal. Labor Code §§ 510, 1194, 1198; IWC 5 Wage Order No. 9-2001, § 3; (4) Failure to Pay Minimum Wages (Cal Labor Code §§ 6 1194, 1197; IWC Wage Order No. 9-2001, § 4); (5) Failure to Pay All Wages Due to 7 Discharged and Quitting Employees (Cal. Labor Code §§ 201, 202, 203); (6) Failure to 8 Furnish Accurate Itemized Wage Statements (Cal. Labor Code § 226; IWC Wage Order 9 No. 9-2001, § 7); (7) Failure to Indemnify Employees for Necessary Expenditures 10 Incurred in Discharge of Duties (Cal. Labor Code § 2802); (8) Unfair and Unlawful 11 Business Practices (Cal. Bus. & Prof. Code §§ 17200 et. seq.). 12 Factual Background 13 Plaintiffs bring this purported class action on behalf of themselves and other 14 similarly-situated persons who worked for Defendants as non-exempt employees in the 15 State of California during the period between 2013 and 2019. ECF No. 33, Second 16 Amended Complaint (“SAC”), at 2-3. 17 Plaintiffs allege that Rohr, Inc. is an aerospace manufacturing company which is a 18 wholly-owned division of UTC Aerospace Systems. ECF No. 56, Pls.’ Motion (“Mot.”), 19 at 10. 3 Plaintiffs allege that Defendants are collectively alter egos of one another, joint 20 employers, and/or integrated enterprises of all employees, as demonstrated by Plaintiffs’ 21 employment records and paystubs which list both Rohr and UTAS as employers. Id. at 22 10; SAC at 6-7. Plaintiffs bring their claims within the Class Period, from March 27, 23 2015 to present. Mot. at 8. During the class period, Plaintiffs allege Defendants operated 24 two facilities in California, in Riverside and Chula Vista. Id. at 10. 25 26 3 27 28 The Court refers to page numbers generated by the CM/ECF system. 3 20-cv-574-GPC-AHG 1 Plaintiff Nathaniel Morgan worked for Defendants as a non-exempt employee 2 from 2014 to approximately December 2016. Id. at 3. He worked at Defendants’ Chula 3 Vista facility as an Operations Specialist in the shipping and receiving departments. Id. 4 Plaintiff Michael Bevan has worked for Defendants as a non-exempt employee from 5 2013 to present, in multiple positions such as Assembler, Quality Technician, and Quality 6 Inspector. Id. Importantly, proposed class representatives Bevan and Morgan are both 7 union members. 8 9 Plaintiffs allege that during the class period both the Riverside and Chula Vista facilities used centralized timekeeping and payroll departments responsible for 10 processing employees’ timekeeping and payroll information, and for programming the 11 timekeeping and payroll systems that employees used. Id. Many of Plaintiffs’ claims for 12 which they seek class certification group together union and non-union employees to 13 support assertions that Defendants’ timekeeping policies and practices apply to all non- 14 exempt employees. Specifically, Plaintiffs state that during the Class Period, all non- 15 exempt Rohr employees in California, including both unionized and nonunionized 16 employees, used the AutoTime timekeeping system to record their time. Id; ECF No. 56- 17 4 (Harris Dep.) at 158-59. From March 27, 2015 to October 13 2019, they used 18 AutoTime 6, and then starting on October 14, 2019 used AutoTime 7. Id. 19 However, while the AutoTime timekeeping system was consistent across the two 20 facilities and was used by all nonexempt employees during the Class Period, the specific 21 practices for timekeeping and payroll varied along two axes depending on: (1) whether 22 the employee is a union member, and (2) which of Defendants’ facilities the employee 23 worked in. See ECF No. 56-4 (Harris Dep.) at 75.4 Prior to October 2019, union 24 25 26 27 28 4 Q: . . . And when were nonexempt employees at Rohr required to clock in and out of work? 4 20-cv-574-GPC-AHG 1 employees in Riverside recorded their time on the AutoTime 6 timekeeping system. ECF 2 No. 56-6 (Moua Dep.) at 50-51. Beginning in 2019, union members at Riverside have 3 used AutoTime 7, and are paid based on the exact time they punch in and out. Id. at 113. 4 In Chula Vista, unionized employees clock in at the beginning of their shifts, and are paid 5 for their shifts. ECF No. 67-2 (Harris Dep.) at 58. If an employee works outside of the 6 shift, employees are required to report this deviation so they can be paid for additional 7 time. Id. In Riverside, non-union employees do not record time with punches. ECF No. 8 67-4 (Moua Dec.) at 111. Instead, they manually enter total time worked each day into 9 the system. Id. And in Chula Vista, non-union employees do not clock in or out. ECF No. 10 67-2 (Harris Dep.) at 58. Instead, their timecards automatically populate eight hours of 11 work for a shift, and they are instructed to adjust their time if they worked more or less 12 than the eight hours, and they are required to sign and verify it daily. Id. at 57, 59. 13 14 15 16 A: So are we speaking of union employees? 17 Q: So if there’s a difference, then I guess that the answer could change, depending on whether they’re unionized or nonunionized. So if it’s helpful, I can break it down . . . when were Rohr’s nonexempt unionized employees required to clock in and out? 18 19 20 [. . . ] 21 A: It’s at the beginning of the shift and at the end of the shift, and that’s specific for Chula Vista. 22 [. . .] 23 Q: And then with respect to nonunionized employees who worked at Rohr at Chula Vista, when were they required to clock in and out of work? 24 25 26 27 28 A: So they clock—their—their time card auto-posts eight hours of work for them, and then they sign it daily. And they adjust it if they worked less than the eight hours or more than the eight hours. 5 20-cv-574-GPC-AHG 1 Overview of Defendants’ Timekeeping Practices Union 2 3 4 6 7 • Beginning in 2019, punch in and out, and paid for exact time of punches • Manually enter total time worked each day • Punch in and out at the beginning and end of shift • Do not punch in on time clock System automatically posts eight hours of work. Sign time card at end of shift to verify hours worked Riverside 5 Chula Vista Non-Union 8 • 9 10 11 • In sum and substance, Plaintiffs allege that Defendants engaged in illegal practices 12 and policies by failing to provide meal and rest breaks, failing to compensate employees 13 for all meal breaks and rest breaks that were not provided, failing to pay minimum and 14 overtime wages, failing to provide accurate itemized statements for pay periods, and 15 failing to properly compensate employees for necessary expenditures, in violation of the 16 California Labor Code and the applicable IWC Wage Order, and the Business and 17 Professions Code which prohibits unfair business practices. SAC at 8-9. Plaintiffs allege 18 “[t]hese illegal practices and policies were applied to all non-exempt employees in 19 violation of the Labor Code, the applicable wage order, and the Business and Professions 20 Code which prohibits unfair business practices arising from such violations.” Id. at 9. 21 In the instant motion, Plaintiffs seeks to certify a Class consisting of: 22 All current and former non-exempt employees of Defendants Rohr, Inc., Hamilton Sun[d]strand d/b/a UTC Aerospace Systems d/b/a Collins Aerospace, and United Technologies Corporation (Defendants”) at Defendants’ facilities in Riverside and Chula Vista, California at any time during the period from March 27, 2015 through the date of class certification (“Class Period”). 23 24 25 26 27 28 6 20-cv-574-GPC-AHG 1 Pls.’ Mot. at 8. Alternatively, Plaintiffs seek to certify the following Classes and/or 2 subclasses: 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1. Minimum Wage Class: all persons employed by Defendants as non-exempt employees at Defendants’ facilities during the Class Period. a. Shaved Time Subclass: all persons employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista from March 27, 2015 through October 13, 2019 who were not paid by Defendants for all time recorded as worked on at least one shift. b. Automatic Deduction Subclass: all persons employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista from March 27, 2015 through October 13, 2019 who worked at least one shift over five hours long in which there was no recorded meal break of at least 30 minutes. c. Rounded Meal Break Subclass: all persons employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista from October 13, 2019 through the date of class certification who worked at least one shift over five hours in which the employee’s rounded meal time was greater than the employee’s recorded meal break time. d. Off-the-clock Subclass: all persons employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista during the Class Period. 2. Overtime Class: all persons employed by Defendants as non-exempt employees at Defendants’ facilities in Riverside and Chula Vista during the Class Period who worked at least one shift over eight hours long. a. Shaved Time Subclass: all persons employed by Defendants as non- exempt, unionized employees at Defendants’ facilities in Riverside and Chula Vista from March 27, 2015 through October 13, 2019 who were not paid by Defendants for all time recorded as worked on at least one shift which was over eight hours long. b. Automatic Deduction Subclass: all persons employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista from March 27, 2015 through October 13, 2019 who worked at least one shift over eight hours long in which there was no recorded meal break of at least 30 minutes. c. Rounded Meal Break Subclass (AutoTime 7): all persons employed as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista from October 14, 2019 through the date of class certification 7 20-cv-574-GPC-AHG 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 who worked at least one shift over eight hours long in which the employee’s rounded meal time was greater than the employee’s recorded meal break time. d. Regular Rate Subclass: all persons employed by Defendants as non-exempt employees at Defendants’ Riverside and Chula Vista facilities during the Class Period who worked at least one shift over eight hours long and also earned at least one other form of non-discretionary remuneration (such as shift differentials, shift premiums, special awards, and other bonuses) during the same pay period. e. Off-the-clock Subclass: all persons employed by Defendants as non-exempt employees at Defendants’ Riverside and Chula Vista facilities during the Class Period who worked at least one shift over eight hours long. 3. Rest Break Class: all persons employed by Defendants as non-exempt employees at Defendants’ facilities in Riverside and Chula Vista during the Class Period who worked at least one shift over five hours long. 4. Meal Period Class: all persons employed by Defendants as non-exempt employees at their facilities in Riverside and Chula Vista during the Class Period who worked at least one shift over five hours long. a. First Meal Break Subclass (Union Employees): all persons employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista during the Class Period who worked at least one shift over five hours long. b. First Meal Break Subclass (Non-Union Employees): all persons employed by Defendants as non-unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista during the Class Period who worked at least one shift over five hours long. c. Second Meal Period Subclass: all persons employed by Defendants as nonexempt employees at Defendants’ facilities in Riverside and Chula Vista during the Class Period who worked at least one shift over ten hours long. 5. Wage Statement Class: all persons employed by Defendants at Defendants’ facilities in Riverside and Chula Vista as non-exempt employees during the Class Period, who received at least one wage statement from Defendants. 23 Mot. at 8-10. Plaintiffs further offer separate subclasses on behalf of union and non-union 24 employees. Id. Plaintiffs also seek certification of derivative claims: (1) failure to pay all 25 wages due to discharged and quitting employees; (2) failure to furnish accurate itemized 26 wage statements; and (3) unfair business practices. Id. at 10. 27 28 8 20-cv-574-GPC-AHG 1 2 3 DISCUSSION A. Legal Standard “The class action is an exception to the usual rule that litigation is conducted by 4 and on behalf of individual named parties only. In order to justify a departure from that 5 rule, a class representative must be part of the class and possess the same interest and 6 suffer the same injury as the class members.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 7 338, 348-49 (2011) (internal quotation marks omitted). 8 9 A plaintiff seeking class certification must affirmatively show that the class meets the requirements of Rule 23. Comcast Corp. v. Behrend, 133 S. Ct. 1426, 1432 (2013) 10 (citing Dukes, 564 U.S. at 350). Federal Rule of Civil Procedure 23 establishes a two-step 11 procedure for analyzing class certification. First, a plaintiff bears the burden of proving 12 that class certification is appropriate because it meets all four requirements of Federal 13 Rule of Civil Procedure 23(a)—numerosity, commonality, typicality and adequacy. Ellis 14 v. Costco Wholesale Corp., 657 F.3d 970, 979-80 (9th Cir. 2011). If these four 15 requirements are satisfied, plaintiffs must show that the lawsuit qualifies for class 16 certification under the relevant provision of Rule 23(b). United Steel, Paper & Forestry, 17 Rubber, Mfg. Energy, Allied Indus. & Serv. Workers Int’l Union AFL-CIO, CLC v. 18 ConocoPhillips Co., 593 F.3d 802, 806 (9th Cir. 2010). 19 While the motion for class certification comes at an early stage of litigation, the 20 Court is required to perform a “rigorous analysis,” which may require it “to probe behind 21 the pleadings before coming to rest on the certification question.” Dukes, 564 U.S. at 350. 22 This inquiry “will frequently entail some overlap with the merits of plaintiff’s underlying 23 claim.” In re AutoZone Inc., Wage & Hour Litig., 289 F.R.D. 526, 530 (N.D. Cal. 2012). 24 Because “the merits of the class members’ substantive claims are often highly relevant 25 when determining whether to certify a class . . . it is not correct to say that a district court 26 may consider the merits to the extent that they overlap with class certification issues; 27 28 9 20-cv-574-GPC-AHG 1 rather, a district court must consider the merits if they overlap with Rule 23(a) 2 requirements.” Ellis, 657 F.3d at 981. The district court does not, however, conduct a 3 “mini-trial” to determine whether the class could actually prevail on the merits of their 4 claims beyond the issues presented by class certification requirements. Id. at 893 n.8. 5 Rule 23 “grants no license to engage in free-ranging merits inquiries at the certification 6 stage. Merits questions may be considered to the extent—but only to the extent—that 7 they are relevant to determining whether the Rule 23 prerequisites for class certification 8 are satisfied.” Amgen, Inc. Conn. Ret. Plans & Trust Funds, 568 U.S. 455, 466 (2013). 9 Here, Plaintiffs seek certification pursuant to Rule 23(b)(3), which requires that 10 “questions of law or fact common to class members predominate over any questions 11 affecting only individual members, and that a class action is superior to other available 12 methods for fairly and efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). 13 B. 14 15 Rule 23(a): Numerosity, Typicality, and Adequacy This Order first addresses the numerosity, typicality and adequacy requirements under Rule 23(a). 16 1. 17 First, “numerosity” requires that the class be “so numerous that joinder of all 18 members is impracticable. Fed. R. Civ. P. 23(a)(1). Impracticability need not mean 19 impossibility, only “difficulty or inconvenience in joining all members of the class.” 20 Makaeff v. Trump Univ., No. 3:10-CV-0940-WVG, 2014 WL 688164, at *7 (S.D. Cal. 21 Feb. 21, 2014) (quoting Harris v. Palm Springs Alpine Estates, Inc., 329 F.2d 909, 913- 22 14 (9th Cir. 1964). The requirement is not tied to a fixed numerical threshold, but courts 23 have routinely found the numerosity requirement satisfied when the class comprises forty 24 or more members. See, e.g., Hilsley v. Ocean Spray Cranberries, Inc., No. 17-CV-2355- 25 GPC-MDD, 2018 WL 6300479, at *4 (S.D. Cal. Nov. 29, 2018) (citing Ikonen v. Hartz 26 Mountain Corp., 122 F.R.D. 258, 262 (S.D. Cal. 1988)); see generally, 1 Newberg on 27 28 Rule 23(a)(1): Numerosity 10 20-cv-574-GPC-AHG 1 Class Actions § 3:12 (5th ed. 2021) (“As a general guideline, however, a class that 2 encompasses fewer than 20 members will likely not be certified absent other indications 3 of impracticability of joinder, while a class of 40 or more members raises a presumption 4 of impracticability of joinder based on numbers alone.”). 5 As described above, Plaintiffs seek to certify claims for all non-exempt union and 6 non-union employees who were employed by Defendants during the Class Period, or they 7 seek to certify five classes (with numerous subclasses) in the alternative. Pls.’ Mot. at 8- 8 10. Plaintiffs indicate “Rohr employed approximately 2,046 non-exempt employees in 9 California during the Class Period.” Id. at 13. Of these employees, at least 1,038 10 employees were union workers at the Riverside facility and 560 employees were union 11 workers at the Chula Vista facility.5 ECF No. 67, Defs.’ Opp. (“Opp.”) at 11. Defendants 12 do not challenge Plaintiffs’ contention that “the proposed class (or classes) are 13 sufficiently numerous.” Pls.’ Mot. at 13; see Opp. at 9 (noting that Plaintiffs’ motion 14 seeks to certify claims for more than 2,000 employees). The Court therefore finds that each of Plaintiffs’ proposed classes, which would 15 16 consist of more than 1,500 union employees satisfy the numerosity requirement. 17 2. 18 Second, Rule 23(a)(3) requires that “the claims or defenses of the representative 19 parties are typical of the claims or defenses of the class.” Fed. R. Civ. P. 23(a)(3). The 20 typicality prerequisite ensures that interests of the named representative align with the Rule 23(a)(3): Typicality 21 22 23 24 25 26 27 28 5 Plaintiffs do not provide in the SAC or the Motion the number of putative class members in each category of employees: Chula Vista union and non-union, and Riverside union and non-union. However, in their Opposition, Defendants provide figures for each employee grouping. See Opp. at 10-11. According to Defendants, in the Riverside facility there are 1,038 union employees and 126 non-union employees. Id. In Chula Vista, there are 560 union employees, and 322 non-union employees. Id. at 11. 11 20-cv-574-GPC-AHG 1 interests of the class. Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992). 2 Typicality tests “whether other members have the same or similar injury, whether the 3 action is based on conduct which is not unique to the named plaintiffs, and whether other 4 class members have been injured by the same course of conduct.” Id. A court should 5 consider the nature of the claim or defense of the class representative, rather than the 6 specific facts from which it arose or for which relief is sought. Id. 7 Defendants argue Plaintiffs’ claims are not typical because “Plaintiffs, who are 8 both union members, may not represent nonunion employees, as different practices apply, 9 including the timing of meal breaks (5 hours v. 6 hours); whether employees are subject 10 to a mandatory break schedule or instead have discretion; whether time is recorded by 11 time punches, and auto-population, or manual entry.” Opp. at 34. 12 A close examination of the claims made by union employees shows that they rely 13 on proofs that do not apply to non-union employees. On Reply, Plaintiffs do not directly 14 respond to the Defendants assertions that the claims of union and non-union employees 15 involve different practices and conduct. Rather, Plaintiffs assert in a general and 16 conclusory fashion that their claims are “based on common practices applicable to all 17 similarly situated employees and are supported by classwide evidence that [Defendants 18 have] failed to rebut.” ECF No. 76, Pls.’ Reply (“Reply”), at 21. Finally, in tacit 19 recognition of the absence of typicality based upon the different practices that apply to 20 union and non-union employees, Plaintiffs add a footnote in their Reply requesting leave 21 to add a non-union employee and class representative to the case. 22 In view of the above, the Court concludes that Plaintiffs have failed to demonstrate 23 that the claims of union and non-union employees are similar or typical of the non-union 24 employees. Further, the Court will not interpret a request to add class representatives 25 contained in a footnote to a reply to the opposition as a properly presented motion to 26 amend pleadings and will deny the request to add non-union employees at this time. 27 28 12 20-cv-574-GPC-AHG 1 3. 2 Rule 23 also requires that the class representative(s) “will fairly and adequately 3 protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). Courts evaluate (1) whether 4 the named plaintiff(s) and counsel have conflicts of interest with the rest of the class, and 5 (2) whether the named plaintiff and counsel will prosecute the action vigorously for the 6 class. In re Autozone, 289 F.R.D. at 530 (citing Hanlon v. Chrysler Corp., 150 F.3d 1011, 7 1019 (9th Cir. 1998)). 8 9 Rule 23(a)(4): Adequacy Plaintiffs’ counsel attests named Plaintiffs Morgan and Bevan have “represented their co-workers with a focus and zeal true to the fiduciary obligation they have 10 undertaken, including by preparing and sitting for their deposition[s], responding to 11 written discovery, attending an Early Neutral Evaluation conference, and working closely 12 with their attorneys throughout the litigation,” and that “there is no conflict of interest 13 between Plaintiffs and the class members.” Pls.’ Mot. at 32. While the class 14 representatives have taken steps to represent their co-workers, the Court concludes that 15 Morgan and Bevan are unable to “fairly and adequately” protect the interests of non- 16 union employees because their claims are not supported by similar classwide proof and 17 therefore are not typical to those of non-union employees. However, the Court does find 18 that Plaintiffs Nathaniel Morgan and Michael Bevan are adequate class representatives 19 for subclasses that are presented on behalf of union employees. 20 Next, there is no suggestion from Defendants that Plaintiffs’ counsel is inadequate. 21 Counsel’s declaration details Matern Law Group’s extensive experience litigating 22 California Labor Code violations for individuals, and through class actions. ECF No. 56- 23 1, Matern Decl. ¶¶ 29-30. Counsel attests he is not aware of any conflict between 24 Plaintiffs and the interests of other members of the proposed classes that would impair 25 Plaintiffs’ ability to serve as class representatives. Id. ¶¶ 38-39. The Court finds that 26 27 28 13 20-cv-574-GPC-AHG 1 Plaintiffs’ counsel at Matern Law Group are adequate counsel for class representatives 2 and the proposed classes. 3 C. Rule 23(a)(2) Commonality and Rule 23(b)(3) Predominance 4 The Court next addresses the final Rule 23(a) factor, commonality, as well as the 5 predominance and superiority requirements for certification of a class action under Rule 6 23(b)(3). Consistent with the Court’s conclusion that proposed class representatives 7 Morgan and Bevan are not suitable representatives for non-union nonexempt employees 8 working in either of Defendants’ facilities, the Court’s decision to certify any of 9 Plaintiffs’ proposed subclasses applies only to union employees. 10 1. 11 The final requirement under Rule 23(a) is that “there are questions of law and fact Commonality and Predominance 12 common to the class.” Fed. R. Civ. P. 23(a)(2). In Dukes, the Supreme Court held that 13 “what matters to class certification . . . is not the raising of common ‘questions’—even in 14 droves—but, rather the capacity of a classwide proceeding to generate common answers 15 apt to drive the resolution of the litigation. Dissimilarities within the proposed class are 16 what have the potential to impede the generation of common answers.” Dukes, 564 U.S. 17 338, 350 (2011) (internal quotation marks omitted) (emphasis in original). 18 To certify a class under Rule 23(b)(3), Plaintiffs must demonstrate that “the 19 questions of law or fact common to class members predominate over any questions 20 affecting only individual members, Fed. R. Civ. P. 23(b)(3). To satisfy Rule 23(b)(3), 21 Plaintiffs must demonstrate that the questions of law or fact common to class members 22 predominate over any questions affecting individual members. Amchem Prods. Inc. v. 23 Windsor, 521 U.S. 591, 623 (1997); Olean Wholesale Grocery Coop., Inc. v. Bumble Bee 24 Foods LLC, 993 F.3d 774, 784 (9th Cir. 2021). Therefore, the Rule 23(a)(2) commonality 25 inquiry and the Rule 23(b)(3) predominance inquiry overlap. 26 27 28 14 20-cv-574-GPC-AHG 1 a. 2 Under the Labor Code, employers must (1) compensate employees at least the Minimum Wage and Overtime Claims 3 minimum wage for “all hours worked” which includes assigned job duties, time “during 4 which an employee is subject to the control of an employer”; and (2) compensate 5 employees for all overtime, which is calculated at one and one-half times the regular rate 6 of pay for all hours worked in excess of eight hours and/or forty hours per week, and for 7 the first eight hours on the seventh consecutive workday, or with double time for all 8 hours worked in excess of twelve hours in any workday. Cal. Lab. Code §§ 510, 1194. 9 For the over-arching Minimum Wage Class, Plaintiffs propose a class of “all 10 persons employed by Defendants as non-exempt employees at Defendants’ facilities in 11 Riverside and Chula Vista during the Class Period.” Pls.’ Mot. at 8. The Overtime Class 12 is made up of “all persons employed by Defendants as non-exempt employees at 13 Defendants’ facilities in Riverside and Chula Vista during the Class Period who worked 14 at least one shift which was over eight hours long.” Id. at 9. The subclasses Plaintiffs seek 15 to certify under the Minimum Wage Class and Overtime Class rely on overlapping 16 theories of liability. 17 Plaintiffs bring their wage and overtime claims under four identical theories of 18 liability: (1) time shaving; (2) automatic deduction of meal periods; (3) rounded meal 19 periods; and (4) off-the clock. Pls.’ Mot. at 8-9. The Overtime Class also relies on the 20 additional theory of denial of regular rate compensation. Id. In addition, Plaintiffs 21 present an additional and separate meal period class and subclasses in their motion which 22 is addressed infra at 34. 23 i. Shaved Time Subclass 24 Under the Minimum Wage and Overtime Class umbrellas, Plaintiffs propose a 25 “shaved time subclass” which they define as “all persons employed by Defendants as 26 unionized, non-exempt employees at Defendants’ facilities in Riverside and Chula Vista 27 28 15 20-cv-574-GPC-AHG 1 from March 27, 2015 through October 13, 2019 who were not paid by Defendants for all 2 time recorded as worked on at least one shift. Pls.’ Mot. at 8. 3 In California, “wage and hour claims are today governed by complementary and 4 occasionally overlapping sources of authority: the provisions of the Labor Code, enacted 5 by the Legislature, and a series of 18 wage orders, adopted by the IWC.” Donohue v. 6 AMN Servs., 11 Cal. 5th 58, 66 (2021) (quoting Brinker Restaurant Corp. v. Superior Ct., 7 53 Cal. 4th 1004, 1026 (2012)). California Labor law requires employers to pay 8 employees at least minimum wage for all hours worked, which includes time employees 9 spend performing their assigned job duties and time “during which an employee is 10 subject to the control of an employer.” Wage Order 1-2001 § 2(H); Frlekin v. Apple, 5 11 Cal. 5th 1038, 1042 (2020); Morillion, 22 Cal. 4th at 582. Under the employer-control 12 doctrine, the California Supreme Court has held that “[t]he level of the employer’s 13 control over its employees rather than the mere fact that the employer requires the 14 employees’ activity, is determinative” of whether compensation is required. Morillion, 22 15 Cal. 4th at 587. Employees must be compensated for all time “during which an employee 16 is subject to the control of an employer, and includes all the time the employee is suffered 17 or permitted to work, whether or not required to do so.” Morillion v. Royal Packing Co., 18 22 Cal. 4th 575, 578 (2000) (finding that travel time in mandatory company-provided 19 buses was compensable as “hours worked” due to employer control over employees). 20 Plaintiffs present the question of whether Defendants paid union employees “based 21 on their scheduled shift start and end times” rather than all time actually worked, 22 resulting in underpayment. Pls.’ Mot. at 8. The time-shaving theory of liability argues 23 that “Defendants had a common practice of paying unionized non-exempt employees 24 based on their scheduled shift start and end times, while shaving all time that was 25 recorded as worked outside of the employees’ scheduled shift.” Pls.’ Mot. at 15. Plaintiffs 26 27 28 16 20-cv-574-GPC-AHG 1 argue class treatment is appropriate for the time shaving theory because they can prove 2 liability with respect to the class members. Pls.’ Mot. at 15. 3 To support their theory, Plaintiffs rely on three categories of evidence: Defendants’ 4 timekeeping policy, Plaintiffs’ expert’s analysis of payroll data, and deposition testimony 5 from Defendants’ employees. 6 Plaintiffs place great weight on Defendants’ timekeeping policy as detailed in the 7 “UTS Aerospace Timekeeping Requirements” document. ECF No. 56-20, Ex. S. The 8 Timekeeping Requirements document states: 9 10 11 12 Accurately recording time worked is the responsibility of every non-exempt employee. Time worked is all the time actually spent on the job performing assigned duties. Each non-exempt employee is required to record accurately the time they began and end their workday, as well as the beginning and ending time of each meal period. 13 Id. Relying on this policy, Plaintiffs argue that Defendant cannot deny that employees 14 were not working when they were clocked in before or after their shift because such 15 position would be inconsistent with Rohr’s policies. See Pls.’ Mot. at 16. Under 16 Plaintiffs’ theory, to the extent that Rohr employees are trained on and instructed to 17 comply with the timekeeping policy, the negative inference suggests that employees only 18 clocked in and recorded their time when they were actually working. Thus, any practice 19 of “shaving” an employee’s time down to only the hours in the scheduled shift would 20 mean “Defendants had a common practice which resulted in systematic underpayment of 21 wages to unionized class members.” Pls.’ Mot. at 15. The Court finds the policy may 22 establish expectations and requirements regarding accurate timekeeping but offers little in 23 the way of support as to whether the policy was followed. 24 Plaintiffs also presented deposition testimony from Rene Trujillo. See ECF No. 56- 25 7 (Trujillo Dep.) at 107:17-108:4. Plaintiffs asked, “would the system round their start 26 time to the start time of their shift regardless of how early they clocked in?” Id. 107:19- 27 28 17 20-cv-574-GPC-AHG 1 21. In response, Trujillo stated: “if the employee—if a nonexempt, union employee 2 clocked in 20 minutes prior to the start of their shift, it would round to their start of their 3 shift.” Id. 108:1-4. And the same rounding happened at the end of an employee’s shift. 4 See id. 112:7-25, 113:1-23. 5 Defendants contest all of Plaintiffs’ purported common proof. In response to 6 Plaintiffs’ reliance on the Timekeeping Requirements, Defendants reject the inference 7 that the moment an employee clocked in was the moment they began working. 8 Defendants point to the Collective Bargaining Agreement that governed payroll policies 9 for all unionized employees during the relevant period. In the Collective Bargaining 10 Agreement, Section 9.05 states: “The Company shall not be liable for time spent in the 11 plant outside of an employee’s shift unless such time is specifically authorized by the 12 Company.” ECF No. 67-2, Collective Bargaining Agreement (“CBA”), at 339. Indeed, 13 the start, rest break, meal break and end time schedules for each shift period are also laid 14 out in the CBA in Section 9.07. Id. At bottom, Defendants’ main contention is that if all 15 employees were aware that they were only being paid for their scheduled shifts, the time 16 they spent on Rohr premises in between the clock-in time and the beginning of a shift 17 was not time worked that was shaved (with the effect of underpaying employees) but 18 rather more of a “grace period.” Employees were instructed to inform their supervisors if 19 they needed their time adjusted, and many routinely did. For example, defense counsel 20 asked Mr. Eryke Ramirez: “So if there was a discrepancy between the time you worked 21 and when you clocked out, would that discrepancy be fixed by the supervisors?” He 22 responded “[y]es. Or if you forgot to clock out or didn’t—or the system crashed, they 23 would—the supervisors would adjust as needed.” ECF No. 67-3 (Ramirez Dep.) at 86. 24 Similarly, an employee whose department assigned work for the day during a kickoff 25 team meeting confirmed the grace period arrangement. When asked “[y]ou never 26 performed any work before the team meeting, correct?” he responded “Correct” and said 27 28 18 20-cv-574-GPC-AHG 1 that he would not have known what work to perform prior to the meeting. ECF No. 67-3 2 (Curl Dep.) at 50. 3 At the very least, Defendants argue that individual questions predominate over the 4 common ones, and the common proof Plaintiffs offer is deeply flawed. First, Plaintiffs’ 5 expert did not determine whether any employees were actually underpaid as a result of 6 the practice under which employees were paid for their scheduled shifts. Opp. at 1.6 7 Because determining whether employees were underpaid would require discussion with 8 each person to determine “which employees were ‘actually working’ after they clocked in 9 but before their shift started” and therefore lost compensable time. Opp. at 17-18. As 10 such, individual questions predominate over the common ones. Since commonality 11 requires “significant proof” of a general policy that harmed the proposed class members, 12 Plaintiffs’ evidence does not satisfy the evidentiary burden as required by Dukes. Accordingly, the Court DENIES Plaintiffs’ motion to certify the Time Shaving 13 14 Subclass. 15 ii. Automatic Deduction of Meal Period Subclass 16 The second wage and overtime subclass Plaintiffs seek to certify is the automatic 17 deduction of meal period subclass, which Plaintiffs define as “all persons employed by 18 Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside 19 20 21 22 23 24 25 26 27 28 6 In the deposition of Plaintiffs’ expert Mr. Gorlick, Defendants probed this issue: Q: Do you know any way to determine whether an employee was actually working between the time indicated on their CLOCK.IN.ACT versus the time START.ROUNDED.LOCAL? A: Determining what employees were doing and sort of defining what work is goes beyond my expertise. So I don’t—I don’t know how that would be done. ECF No. 67-2 (Gorlick Dep.) at 452. 19 20-cv-574-GPC-AHG 1 and Chula Vista from March 27, 2015 through October 13, 2019 who were not paid by 2 Defendants for all time recorded as worked on at least one shift.” Pls.’ Mot. at 8. 3 Under the California law, employers are required to accurately record when each 4 employee begins and ends each work period, as well as meal periods. Wage Order 1- 5 2001, § 7(A)(3). Plaintiffs allege Defendants “had a practice of not recording the times 6 that the unionized employees actually started and ended meal times,” and instead 7 “automatically deducted a 30-minute break from employees’ time entries each day.” Id. 8 (citing ECF No. 56-21, Gorlick Decl., at 9). 9 Plaintiffs seek to certify the subclass based on a common question of whether 10 Defendants’ failure to track meal breaks for unionized employees, and instead 11 automatically deducting 30-minute meal periods from time records resulted in employees 12 being underpaid. Pls.’ Mot. at 18. Ultimately, Plaintiffs’ theory of liability is based upon 13 Defendants’ lack of record-keeping. To support this theory, Plaintiffs rely on a recent 14 California Supreme Court decision, Donohue v. AMN Servs., 11 Cal. 5th 58 (2021), in 15 which the Court held, “[i]f an employer’s records show no meal period for a given shift 16 over five hours, a rebuttable presumption arises that the employee was not relieved of 17 duty and no meal was provided, id. at 74. The court observed that the rebuttable 18 presumption derives from an employer’s duty to maintain accurate records of meal 19 periods. Id. at 76; Brinker, 53 Cal. 4th at 1053 (Werdegar, J., concurring); Wage Order 20 No. 4, § 7(A)(3) (“Every employer shall keep accurate information with respect to each 21 employee including . . . time records showing when the employee begins and ends each 22 work period . . . . Meal periods . . . shall also be recorded.”). 23 Plaintiff relies on this rebuttable presumption to support their claim that they are 24 entitled to recover missed meal breaks. Plaintiffs also present statistical analysis by their 25 expert. See Pls.’ Mot. at 18. The analysis showed that within the sample, there were no 26 recorded meal breaks in 99.5% of shifts that longer than five hours, but employees’ time 27 28 20 20-cv-574-GPC-AHG 1 records showed automatically deducted 30-minute meal breaks from employees’ time 2 entries. ECF No. 56-21, Gorlick Decl., at 9. 3 Defendants’ primary defense is that the automatic deduction of lunch breaks does 4 not violate the Wage Order because they are excused from maintaining a record of meal 5 breaks under Wage Order 1-2001, § 7(A)(3) which provides in part: “Meal periods during 6 which operations cease and authorized rest periods need not be recorded.” To support this 7 exception, Defendants point to declarations by “[o]ver a dozen employees [who] stated 8 they do not work during meal breaks,” and who “assert no work can be performed 9 because their departments shut down.” Opp. at 19. Thus, Defendants argue that their meal 10 break deduction policy was lawful because department operations ceased, and 11 individualized issues predominate because it is not clear how to determine which 12 employees actually worked during the meal period that was deducted from their time 13 records without discussing the matter with each employee. See id. 14 Ultimately, Plaintiffs and Defendants disagree on whether operations in 15 Defendants’ facilities ceased and therefore whether the exception applies. The Court 16 finds that Plaintiffs have offered a theory of liability that relies on common evidence to 17 create a rebuttable presumption that Defendants denied employees their meal breaks. 18 Further, upon an examination of the effect that the offered defense will have on the 19 common question Plaintiffs raise, the Court finds that such a defense will not create 20 issues specific to each potential class member such that individualized issues raised by 21 the defense will predominate over common issues. 22 Here, the defense that Defendants were excused from recording record of meal 23 breaks under Wage Order 1-2001, § 7(A)(3) is capable of being addressed with common 24 evidence as to the operations of the Rohr facilities. If such a practice existed, one would 25 expect documents which spell out how the practice was maintained and followed 26 27 28 21 20-cv-574-GPC-AHG 1 throughout Rohr’s plants. In the event that Defendants prevail on this issue during 2 pretrial proceedings or at trial, the subclass will be subject to being decertified.7 3 4 Accordingly, the Court GRANTS class certification as to the automatic-deduction subclass. 5 iii. Rounded Meal Break Subclass 6 Closely related to the automatic deduction subclass is Plaintiffs’ proffered 7 “rounded meal break subclass.” Plaintiffs define the subclass as: “all persons employed 8 by Defendants as unionized, non-exempt employees at Defendants’ facilities in Riverside 9 and Chula Vista from October 13, 2019 through the date of class certification who 10 worked at least one shift over five hours in which the employee’s rounded meal time was 11 greater than the employee’s recorded meal break time. For this subclass, Plaintiffs present the common question whether Defendants’ 12 13 practice of rounding meal break times to 30 minutes, instead of using meal break times 14 recorded by employees undercompensated employees. Pls.’ Mot. at 19. Critical to 15 ascertaining the distinction between Plaintiffs’ automatic deduction and rounded meal 16 break subclasses is Defendants’ transition from AutoTime 6 and AutoTime 7. From 17 March 27, 2015 to October 13 2019, Defendants used AutoTime 6 to record, track and 18 manage payroll records for employees. ECF No. 56-4, Harris Decl., at 158-59. On 19 October 14, 2019, Defendants began using AutoTime 7. Id. As discussed in the previous 20 section, under AutoTime 6, 30-minute meal breaks were automatically deducted from 21 employees’ time records. Starting with AutoTime 7, employees began to record the start 22 23 24 25 26 27 28 7 The Court observes that without the rebuttable presumption, Plaintiffs have not offered an alternative theory that relies on common evidence to establish that they were denied meal periods. In the absence of the rebuttable presumption, the Plaintiffs have not offered a theory that relies on common evidence to establish liability. 22 20-cv-574-GPC-AHG 1 and end of their meal periods. Id. Plaintiffs allege that “[e]ven after October 13, 2019, 2 when employees began clocking in and out for meal periods, Rohr refused to compensate 3 employees based on recorded meal break times,” and instead, “compensated employees 4 based on rounded meal break times as opposed to employees’ actual recorded time 5 entries.” Pls.’ Mot. at 19. To support their theory of liability, Plaintiffs point to their 6 expert’s analysis of the timekeeping records for the putative class. Id. Mr. Gorlick 7 “analyzed the difference between the reported rounded hours and the actual hours, which 8 are the elapsed hours between actual time punches in and out,” and estimated that the 9 system recorded an average of 6.1 fewer minute of time worked than actual time recorded 10 from employees’ time punches. ECF No. 56-21, Gorlick Decl., at 11. Overall, the 11 analysis found that 99.1% of the employees in the sample had at least one shift with 12 fewer rounded hours than actual hours recorded. Id. 13 In Donohue, the California Supreme Court found that “[t]he practice of rounding 14 time punches for meal periods is inconsistent with the purpose of the Labor Code and the 15 IWC wage order,” 11 Cal. 5th at 68. Further, “[t]he precision of the time requirements set 16 out in Labor Code section 512 and Wage Order No.4—“not less than 30 minutes’ and 17 ‘five hours per day’ or ‘ten hours per day’— is at odds with the imprecise calculations 18 that rounding involves.” Id. When an employee’s meal break is shorter than the thirty 19 minutes required by law, an employer is required to pay a meal period premium as 20 compensation. Under Defendants’ policy, a meal break recorded from 10:59 a.m. to 21 11:31 a.m. is treated the same as a meal break recorded from 11:02 a.m. to 11:28 a.m. As 22 the California Supreme Court noted, this sort of rounding which treats a compliant 23 (indeed, two minutes “too long”) meal break the same as a noncompliant 26-minute meal 24 break contravenes the structure and purpose of the governing law. See id. at 69. (“The 25 premium pay structure under Labor Code section 226.7 and Wage Order No. 4 confirms 26 that rounding is inappropriate in the meal period context.”) 27 28 23 20-cv-574-GPC-AHG 1 Defendants argue the rounded meal break subclass is not susceptible to classwide 2 treatment because it suffers from the same deficiencies as the automatic-deduction theory 3 of liability. Opp. at 20. Specifically, the theory “assumes employees performed some 4 work during part of their meal breaks and is not certifiable for the same reasons.” Id. The 5 Court disagrees with this interpretation. Under the applicable law, the rounded meal 6 break theory does not require Plaintiffs to demonstrate that employees were working 7 during the rounded meal period. From the unequivocal language in Donohue, it appears 8 that Plaintiffs need only demonstrate that Defendants had a practice of rounding 9 employees’ meal periods to thirty minutes, despite what the actual length of the meal 10 period punched by employees truly was. See Donohue, 11 Cal. 5th at 69 (finding that 11 rounding of meal breaks does not comply with the Wage Order). 12 The Court finds Plaintiffs have presented common evidence in the form of 13 timekeeping records, that is susceptible to a classwide inquiry into whether Defendants’ 14 practice of rounding meal breaks under AutoTime 7 was unlawful, and whether 15 Defendants are liable to compensate putative class members for the presumed meal break 16 violations. The Court hereby GRANTS class certification as to the Minimum Wage – 17 Rounded Meal Break Subclass and the Overtime – Rounded Meal Break Subclass. 18 iv. Off-the-Clock Subclass 19 Plaintiffs’ final proposed wage and overtime subclass consists of “all persons 20 employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in 21 Riverside and Chula Vista during the Class Period.” Pls.’ Mot. at 8. 22 Plaintiffs present the question of “[w]hether Defendants failed to compensate 23 employees for all hours worked as a result of their policies which required employees to 24 be subject to Defendant[s’] control while off-the-clock.” Pls.’ Mot. at 21. To support the 25 off-the-clock theory of liability, Plaintiffs state “substantial evidence demonstrates that 26 putative class members were not compensated for time spent before their shifts during 27 28 24 20-cv-574-GPC-AHG 1 which they were required to perform work-related tasks, including, e.g., scanning in at 2 the security gate, donning their uniforms/protective gear, and walking to the time clock 3 located closes to their work area before they could clock in for work” along with 4 claiming that “Defendants’ practices of requiring employees to leave and return to their 5 work area within the 30-minute break period” and donning and doffing protective gear 6 within 30 minutes. Pls.’ Mot. at 20-21. As a result, employees were undercompensated 7 for their time spent working outside of scheduled shift hours. Under California law, “a plaintiff may establish liability for an off-the-clock claim 8 9 by proving that (1) he performed work for which he did not receive compensation; (2) 10 that defendants knew or should have known that plaintiff did so; but that (3) the 11 defendants stood idly by.” Jimenez v. Allstate Ins. Co., 765 F.3d 1161, 1165 (9th Cir. 12 2014) (quoting Adoma v. Univ. of Phoenix, Inc., 270 F.R.D. 543, 548 (E.D. Cal. 2010)). 13 Defendants contend that all of Plaintiffs’ sub-theories fail. 14 1. Scanning and Walking 15 To support the scanning and walking off-the-clock theory, Plaintiffs rely mostly on 16 Deposition testimony. For example, Plaintiffs point to testimony from an employee that it 17 was the policy to clock in at the time clock closes to one’s work area, and that it took this 18 employee nine minutes to walk from his car to the time clock where he was permitted to 19 swipe in. ECF No. 77 at 20.8 Plaintiffs also point to testimony from one of Defendants’ 20 21 8 22 Q: Once you walked through the turnstile, you walked to your workstation; is that correct? 23 A: Walked to my work area to clock in, yes. 24 […] 25 Q: How long did it take to walk from your car to the first time clock for which you could swipe in? 26 27 28 A: Approximately, nine minutes. 25 20-cv-574-GPC-AHG 1 PMK, who stated “the guidance that we give to employees is to try to clock in at the 2 terminal that’s closest to their work area.” Pls.’ Mot. at 20. 3 Defendants, on the other hand, argue that this theory of liability fails because 4 Defendants were not required to compensate employees for the time spent scanning in at 5 the gate to Defendants’ facilities or the time spend walking to employee time clocks or 6 workstations. Opp. at 20. “California law is clear that travel time is compensable only if 7 the employer ‘require[s] employees to take certain transportation to a work site.’” Opp. at 8 21 (citing Morillion, 22 Cal. 4th at 588 (2000); see also Overton v. Walt Disney Co., 136 9 Cal. App. 4th 263, 271 (2006) (finding employees’ time spent commuting to work in 10 employer-provided bus was not compensable because the provided bus was optional). 11 Thus, Defendants had no obligation to compensate employees for their time scanning in 12 and out at the gate, or walking to their workstations, so there was no harm to putative 13 class members. Even if the time was compensable, Defendants argue that individualized 14 issues predominate. Opp. at 21. For some employees the time it takes to walk from the 15 facility entrance to a workstation “varies on any given day based on a multitude of 16 factors, such as where the employee parks, where they work at the facility, an employee’s 17 pace of walk, and even whether the employee speaks to coworkers.” Id. Here, 18 individualized inquiries predominate, and the Plaintiffs have not demonstrated there is 19 classwide evidence available to allow the trier of fact to determine the amount of time 20 employees spent scanning in, walking to the nearest time clock, and reporting to their 21 workstations. Further, and more fundamentally, Plaintiffs failed to demonstrate that there 22 was, as a legal matter, any violation for which Defendants can be held liable. Therefore, 23 24 25 Q: Why couldn’t you swipe in to that first time clock? 26 A: We were – It was [the] policy that you clock in to your – into a time clock in your own work area. 27 28 26 20-cv-574-GPC-AHG 1 the Court finds that class certification is not proper for off-the-clock time under the 2 scanning and walking theory of liability. 3 2. 4 Donning and Doffing Similarly, Plaintiffs argued that Plaintiffs were undercompensated because they 5 were required to don and doff protective gear, and that Defendants did not pay class 6 members for this time spent pre-shift. Pls.’ Mot. at 20. On Reply, Plaintiffs point to 7 testimony from Defendants’ PMK, who affirmed that “unionized employees . . . are 8 required . . . to be clocked in and dressed and ready to begin working by the start time of 9 their shift.” ECF No. 77 at 21 (citing ECF No. 56-4 (Harris Dep.) at 97). Plaintiffs cite to 10 deposition testimony to assert that Defendants “do[] not dispute that it required all union 11 employees to don protective gear . . . and prohibited all of them from bringing food to the 12 work area.” Reply at 16. Generally, Defendants argue that there is no common practice 13 with common proof, and that there is no such policy requiring donning and doffing while 14 employees are off the clock, and “[m]any employees testified that they never donned and 15 doffed off the clock” and individualized issues would predominate over common 16 questions. Opp. at 23 & n.35. 17 18 3. Travel to and from workstation during breaks Finally, Plaintiffs present the question of whether Defendants had a policy and 19 practice of requiring employees to leave and return to their workstations within the 20 designated break time. Pls.’ Mot. at 20-21. Plaintiffs argue this policy represents a 21 “failure to relinquish control over employees” during their breaks. Id. at 20. 22 As discussed above, Plaintiffs cite to deposition testimony to assert that 23 Defendants “do[] not dispute that . . . [they] prohibited all of them from bringing food to 24 the work area.” Reply at 16. However, as Defendants note, the testimony excerpts on the 25 pages to which Plaintiffs point do not support this assertion at all. “At most though, only 26 one piece of that evidence arguably relates to a purported prohibition of food at the work 27 28 27 20-cv-574-GPC-AHG 1 area. The rest of the evidence provides that employees left workstations to eat, but were 2 not necessarily required or bound by a policy to do so.” Sur-Reply at 16. Thus, 3 Defendants argue Plaintiffs failed to establish Defendants had any policy or practice of 4 requiring employees to leave their workstations during meal breaks. Opp. at 22. From the 5 Court’s own review of the deposition testimony to which Plaintiffs point, there seems to 6 be no evidence whatsoever that such a policy existed, or Plaintiffs have failed to direct 7 the Court’s attention to such evidence. The Court finds that certification of Plaintiffs’ off- 8 the-clock theory of liability is not proper as to the travel to and from workstation theory. 9 Plaintiffs have failed to demonstrate that there are common policies or practices as 10 to the scanning and walking, donning and doffing, or travel to-and-from workstations 11 theories, such that class certification for the off-the-clock theory of liability would be 12 appropriate. The Court DENIES class certification as to the off-the-clock subclass. 13 14 v. Regular Rate Subclass With respect to their Overtime Class, Plaintiffs seek to certify a “regular rate 15 subclass” to include “all persons employed by Defendants as non-exempt employees at 16 Defendants’ Riverside and Chula Vista facilities during the Class Period who worked at 17 least one shift over eight hours long and also earned at least one form of non- 18 discretionary renumeration (such as shift differentials, shift premiums, special awards, 19 and other bonuses) during the same pay period.” Pls.’ Mot. at 9. 20 Under California law, each employee must be paid overtime wages at a rate of “no 21 less than one and one half times the regular rate of pay” for that individual employee. 22 Lab. Code § 510(a); 8 Cal. Code Reg. § 11100, subd. 3(A)(1). The “regular rate” of pay 23 is also important in the meal and rest period context. If an employee misses a meal or rest 24 break, the premium paid to the employee must also be paid at the employee’s regular 25 rate. Lab. Code § 226.7(c); 8 Cal. Code Reg. § 11100, subd. 11(B), 12(B). When 26 calculating the “regular rate” for overtime pay and the meal or rest break premiums, 27 28 28 20-cv-574-GPC-AHG 1 employers must include in the calculation not only the employee’s “base” rate of pay, but 2 also any additional non-discretionary forms of renumeration. Ferra v. Loews Hollywood 3 Hotel, LLC, 11 Cal. 5th 858 (2021). Many different forms of renumeration must be 4 included in the calculation of the employee’s regular rate of pay, including hourly 5 earnings, salary, piecework earnings, commissions, non-discretionary bonuses, and the 6 value of meals and lodging. DLSE Manual § 49.1.1. At bottom, the regular rate is an 7 average of the employee’s total earnings from a pay period—that is “his total earnings 8 (except statutory exclusions) are computed to include his compensation during the 9 workweek from all such rates, and are then divided by the total number of hours worked 10 at all jobs.” 29 C.F.R § 778.115; DLSE Manual § 49.2.5; Huntington Memorial Hosp. v. 11 Sup. Ct., 131 Cal.App.4th 893, 902-03 (2005) (finding California Labor Code follows 12 federal standard for determining an employee’s regular rate of pay); Magadia v. Wal- 13 Mart Assoc., Inc., 384 F.Supp.3d 1058, 1077-78 (N.D. Cal. 2019) (finding “regular rate 14 of compensation . . . means the employee’s base rate of compensation plus ‘other forms 15 of qualifying compensation . . . .”); Ibarra v. Wells Fargo Bank, N.A., 2018 WL 2146380, 16 at *3 (C.D. Cal. 2018). 17 Plaintiffs present the common question of whether Defendants failed to properly 18 calculate the regular rate of pay for employees for the purposes of overtime. See Pls.’ 19 Mot. at 22. Plaintiffs have argued that “Defendant has a uniform practice of failing to pay 20 overtime at the regular rate of pay” because Rohr failed to include non-discretionary 21 renumeration in the regular rate of pay for overtime purposes. Id. To support their theory 22 of liability, Plaintiffs rely upon their expert’s analysis of employee payroll records which 23 “reflect various forms of [non-discretionary] renumeration, such as shift premiums, merit 24 awards, special award, and gift cards.” Id. 25 26 27 28 In his analysis, Plaintiffs’ expert found that Defendants’ “payroll data included earnings codes that I understand Plaintiffs allege to be additional renumeration that 29 20-cv-574-GPC-AHG 1 should be factored into the regular rate of pay for overtime purposes.” ECF No. 56-21 2 (Gorlick Decl. at 15). The payroll codes that are potentially relevant to this question 3 included “SHIFT PREM,” “MERIT LUMP,” “AWARD,” “SPECIAL AWARD,” “GIFR 4 CARD,” and “CTRCT SGN BON.” Id. Mr. Gorlick found that 233 of 299 employees 5 analyzed in the sample “had at least one pay period with overtime and one of the above 6 forms of additional renumeration.” Id. (emphasis added). 7 Defendants argue that Mr. Gorlick’s analysis of the sample does not draw any legal 8 conclusion about whether or not each form of additional renumeration should have been 9 factored into overtime. Opp. at 24. In other words, the finding that 233 of 299 employees 10 received some form of additional renumeration does not determine whether, for each 11 employee, that renumeration was discretionary or non-discretionary, and needed to be 12 included in the regular rate calculation. Id. As such, individualized inquiries will be 13 required to determine (1) whether the remuneration is non-discretionary; (2) whether 14 each employee earned that remuneration; (3) whether the employee received overtime 15 pay during that period; and (4) whether the remuneration was factored into the overtime 16 pay. Opp. at 24. 17 The parties offer differing interpretations of how district courts have addressed the 18 regular rate theory of liability. See Reply at 16. Plaintiffs maintain that their regular rate 19 theory is suitable for classwide treatment for two reasons that belie Defendants 20 arguments. First, Plaintiffs have identified the forms of renumeration that Defendants 21 failed to include in employees’ regular rate of pay. Cf. Bebber v. Dignity Health, 2021 22 WL 1187268 (E.D. Cal. Mar. 30, 2021) (finding no commonality where plaintiffs did not 23 identify the types of renumeration that the defendant failed to include in the regular rate 24 of pay). Here, Plaintiffs have identified the forms of renumeration they believe are at 25 issue for all employees in the proposed regular rate class. Second, contrary to 26 Defendants’ arguments, Plaintiffs contend the identified forms of renumerations applied 27 28 30 20-cv-574-GPC-AHG 1 broadly to proposed class members. Cf. Culley v. Lincare Inc., F. Supp. 3d 1184 at 1188- 2 89 (2017) (on summary judgment, decertifying regular rate class because plaintiffs failed 3 to sufficiently illustrate that defendant’s bonus plan was non-discretionary, and it would 4 not otherwise be covered by FLSA). Unlike in Culley, here, Plaintiffs have asserted that 5 various identified renumerations applied to all employees in the proposed class and 6 “agreed they were compensation for work performed” and applied to all members of the 7 proposed regular rate subclass. Reply at 16. 8 9 Ultimately, the Court finds that the regular rate subclass is suitable for certification and GRANTS certification of this subclass. Plaintiffs’ common question on the regular 10 rate theory can be answered with common proof based on Defendants’ timekeeping 11 records and employees’ wage statements which will demonstrate whether employees’ 12 received non-discretionary renumeration for hours worked that was not included in the 13 regular rate of pay for the purposes of overtime and meal compensation. 14 b. 15 Plaintiffs seek to certify a Meal Break Class consisting of “all persons employed 16 by Defendants as non-exempt employees at their facilities in Riverside and Chula Vista 17 during the Class period who worked at least one shift over five hours long.” Pls.’ Mot. at 18 9. The proposed Meal Period Class is divided into three subclasses: (1) first meal break 19 subclass for union employees, (2) first meal break subclass for non-union employees, and 20 (3) second meal period subclass for all employees. Id. at 9-10. 21 Meal Period Claims Class i. First Meal Break Subclass 22 Plaintiffs define the First Meal Break Subclass for union employees as “all persons 23 employed by Defendants as unionized, non-exempt employees at Defendants’ facilities in 24 Riverside and Chula Vista during the Class Period who worked at least one shift over five 25 hours long.” Id. at 9. 26 27 28 31 20-cv-574-GPC-AHG 1 As to the first meal break subclasses, Plaintiffs renew their allegations that underly 2 the automatic-deduction and rounded meal break theories, discussed above. The new 3 common question they present is “whether Rohr had a common practice of not paying 4 employees meal and rest break premiums when compliant meal and/or rest breaks were 5 not provided.” Pls.’ Mot. at 23. 6 Under California law, “[i]f an employer fails to provide an employee a meal or rest 7 or recovery period in accordance with state law . . . the employer shall pay the employee 8 one additional hour of pay at the employee’s regular rate of compensation for each 9 workday that the meal or rest or recovery period is not provided.” Cal. Lab. Code 10 § 226.7(c). Plaintiffs allege Defendants did not pay required statutory break premiums. 11 Pls.’ Mot. at 28. 12 To support their theory of liability, Plaintiffs rely on Defendants’ sample 13 timekeeping records, and Mr. Gorlick’s analysis of those records, to assert that “100% of 14 employees had at least one recorded meal break violation.” Id. (citing ECF No. 56-21, 15 Gorlick Decl., at 15). Specifically, Plaintiffs point to three sorts of violations: (1) meal 16 breaks that began after more than five hours of work; (2) shifts where there was no 17 recorded meal break; and (3) meal breaks that were shorter than 30 minutes in length. 18 ECF No. 56-21, Gorlick Decl., at 12. Based on Plaintiffs’ expert analysis, 66.4% of work 19 shifts which lasted longer than 5 hours (the time at which employers are required to 20 provide a meal break), had at least one late, missed, or shortened meal break. Id. 21 Defendants contend that Plaintiffs have failed to establish that Defendants had a 22 common practice of forcing employees to take meal or rest breaks short or late or to miss 23 them altogether. Opp. at 23 (citing Coleman v. Jenny Craig, Inc., 649 F. App’x 387, 388 24 (9th Cir. 2016)). Further, Defendants argue that they did pay meal break premiums. Opp. 25 26 27 28 32 20-cv-574-GPC-AHG 1 at 32 (citing ECF No. 56-6, Moua Dep., at 155).9 And finally, they argue Plaintiffs 2 misapply Safeway, Inc. v. Superior Ct., 238 Cal. App. 4th 1138 (2015). In Safeway, the 3 court found that class certification was appropriate “when an employer directs or 4 improperly pressures employees to miss, shorten, or delay meal breaks in the absence of a 5 suitable waiver or agreement, employees accrue premium wages that the employer is 6 obliged to pay, without any demand or action by the employee,” 238 Cal. App. 4th at 7 1156. 8 Defendants argue that that Safeway does not support the conclusion that a failure to 9 pay premiums, alone, supports certification and that courts have “denied certifying claims 10 based on the failure to pay premiums where, like here, the plaintiffs seek actual accrued 11 premiums, understanding that individual assessment of how many breaks were missed 12 would be required.” Opp. at 32 (citing Wilson v. TE Connectivity Networks, Inc., 2017 13 WL 1758048, at *9 (N.D. Cal. 2017)). 14 15 16 17 9 Q: Are you familiar with the term ‘meal break penalty’? [. . .] A: Yes, I am. 18 Q: What’s your understanding of that terminology? 19 21 A: So employees are supposed to receive an uninterrupted – like if they work a specific amount of time—meal break. If they’re interrupted, if they don’t get it, if it doesn’t fall within that period or whatever, then we have to pay a—or if they don’t take that full time, we have a pay a meal premium, a penalty. 22 Q: And do you have an understanding of what that premium or penalty is? 23 [. . .] 24 A: One hour of regular pay. 25 Q: Okay. And are you aware of employees received meal premiums or penalties? 20 26 27 28 A: Yes. 33 20-cv-574-GPC-AHG 1 As discussed in the Rounded Meal Break Subclass section, supra at 15, the law 2 governing meal breaks is clear, and the failure to pay premiums when those regulations 3 are not followed, contravenes the purpose of the statutory scheme. With a full dataset of 4 payroll data and timekeeping records, meal break premiums owed to putative class 5 members for missed and shortened meal breaks can be assessed on a classwide basis, and 6 will not necessarily require individual inquiry into the circumstances surrounding each 7 and every employee’s work shifts and meal break periods. Therefore, the Court hereby 8 GRANTS class certification as to the Break Premium Theory of the First Meal Break 9 Subclass (along with the Rounded Meal Break and Automatic Deduction Subclass 10 theories). 11 iii. Second Meal Period Subclass 12 Plaintiffs’ Second Meal Period Subclass is defined as “all persons employed by 13 Defendants as non-exempt employees at Defendants’ facilities in Riverside and Chula 14 Vista during the Class Period who worked at least one shift over ten hours long.” Pls.’ 15 Mot., at 10. Plaintiffs allege that Defendants “had a common practice of failing to provide 16 17 employees with a second 30-minute meal period during shifts over ten hours long.” Id. at 18 25. To support this theory of liability, Plaintiffs again rely on the rebuttable presumption 19 created by Defendants’ failure to record meal breaks.10 Id. 20 21 22 23 24 25 26 27 28 10 In their papers supporting the second meal subclass, Plaintiffs offer an alternative theory in support of their claim, they assert that they were denied a 30-minute meal period because their meal break was shortened by the time required to walk to and from their workstation. This theory is premised on the idea that employees walking to and from lunch are under control of their employer. Plaintiffs do not offer any caselaw in support of this novel proposition and the Court rejects it. 34 20-cv-574-GPC-AHG 1 With respect to the second meal period class, Defendants do not rely on the 2 cessation of operations exception to the recording of meal breaks under Wage Order 1- 3 2001, § 7(A)(3). Instead, Defendants contend that Plaintiffs have ignored the lawful 4 written policy, under which “Rohr policy provides a second meal break by the end of the 5 tenth hour of work and a third rest break to employees who work more than 10 hours a 6 shift.” Opp. at 27. “This facially lawful policy precludes commonality.” Id. (citing Perez 7 v. Leprino Foods Co., 2021 WL 53068, at *8 (E.D. Cal. Jan. 6, 2021). Here, Plaintiffs 8 instead argue that while the meal break policy is lawful on its face, the common practice 9 violated the policy. 10 For the reasons discussed above, the Court GRANTS Plaintiffs’ motion to certify 11 the Meal Period Class as to the Second Meal Period Subclass based on the Break 12 Premium, Rounded Meal Break Subclass and Automatic Deduction theories of liability. 13 c. 14 In their motion, Plaintiffs define the Rest Break Class as “all persons employed by Rest Break Claims Class 15 Defendants as non-exempt employees at Defendants’ facilities in Riverside and Chula 16 Vista during the Class Period who worked at least one shift over 3.5 hours long.” Pls.’ 17 Mot. at 9. 18 The common question presented by Plaintiffs is whether Defendants failed to 19 relinquish control over employees due to their practice of prohibiting employees from 20 leaving the premises for rest breaks. Id. at 23. To support their theory of liability, 21 Plaintiffs rely primarily on instructions distributed to managers at the Riverside facility in 22 the form of a “Talking Point” memorandum as evidence that Defendants required 23 employees to stay on premises during their rest breaks. ECF No. 56-12, Ex. K (“Talking 24 Point”). The Talking Point states: “Hourly and non-exempt employees may not leave the 25 facility during the 10 minute break; this is defined as outside of the turnstiles. The half 26 27 28 35 20-cv-574-GPC-AHG 1 hour lunch break is unpaid and employees may leave the facility during this time only.” 2 Id. at 3. Plaintiffs argue that “substantial testimony from Plaintiffs and other class members 3 4 confirms the instruction to management that non-exempt employees were not permitted 5 to leave the premises for their 10-minute rest breaks.” Pls.’ Mot. at 24. Here, Plaintiffs 6 have pointed to a specific policy that applied to employees. But Plaintiffs fail to 7 acknowledge key facts that ultimately defeat certification of these claims. First, 8 Defendants’ written rest break policy for union employees was governed by the 9 Collective Bargaining Agreement effective during the Class Period. See ECF No. 67-2 10 (“CBA”) at 333. Section 25.01 of the CBA reads “There will be two ten (10) minute rest 11 periods for the first and second shifts . . . one (1) before and one (1) after the regular 12 lunch period, at such times as are designated by the Company. Those employees who 13 work two (2) more hours of overtime either before or after their assigned shift will be 14 granted a ten (10) minute rest period at a time designated by the Company.” Id. Further, 15 the Company’s rest break policy stated: “Employees are authorized and permitted to take 16 one 10-minute paid rest break for every four hours worked or major portion thereof.” 17 ECF No. 67-2 at 418. This policy was distributed to each employee at the start of their 18 employment, and posted in employees’ break rooms. ECF No. 67-4 (Fonseca Decl.) at 19 48. 20 Further, Plaintiffs conveniently omit the fact that the Talking Point was distributed 21 only to supervisors at the Riverside facility, not those at Chula Vista. ECF No. 67-4 at 22 111 (Moua Decl.). Second, the Talking Points distributed on July 25, 2018, see ECF No. 23 56-12 (“Talking Point”) and retracted only sixty-one days later on September 24, 2018, 24 see ECF No. 67-2 at 411 (“Talking Point and Related Correspondence”) (“Employees 25 may utilize the 10 minutes to include exiting the turnstiles”). See also ECF No. 67-2 26 (Moua Dep.) at 238-41; ECF No. 67-4 (Moua Decl.) at 111. It was only distributed to 27 28 36 20-cv-574-GPC-AHG 1 supervisors, not employees. ECF No. 67-4 (Moua Decl.) at 111. And while they point to 2 “substantial testimony” by employees as evidence that employees were not permitted to 3 leave during rest breaks or were not aware they were affirmatively permitted to do so,11 4 on the whole they do not support the contention that employees were told about the 5 policy and required to comply with the policy.12 6 Defendants also counter with evidence suggesting that employees did leave the 7 premises on their rest breaks. ECF No. 67-4 (Moser Decl.) at 73 (“I spent my rest breaks 8 by exiting the turnstile to our facility and smoking a cigarette in a dirt patch near a traffic 9 intersection. I was never told not to do this and I never go in trouble for doing so”); ECF 10 No. 67-4 (Walker Decl.) at 89 “I do not do any work during my rest breaks and am free 11 to do whatever I want. As a result, I have spent nearly every rest break by leaving the 12 premises to smoke on the sidewalk on Arlington Avenue in Riverside. I know it is within 13 my right under company policy to go offside during my rest breaks. No one has told me 14 otherwise, and I have not been punished or coached for doing so”). 15 16 17 See, e.g., ECF No. 67-3 (Kline Dep.) at 36-37 (Q: “So you never took rest breaks off company premises, right?” A: “Correct.” Q: But you were allowed to leave on your rest breaks, right? A: “I’m not sure.” Q: “But no supervisor told you can’t leave for your rest breaks?” A: “No.” Q: “And you never heard of anyone being disciplined for leaving the premises during a rest break, right?” A: “No.” Q: “You never heard of someone else being told not to leave for a rest break, right?” A: No.”) 11 18 19 20 21 22 23 24 25 26 27 28 See, e.g. ECF No. 67-3 (McDaniel Dep.) at 16-18 (Q: “Now, what would you do on your rest breaks?” A: “Handle personal stuff” Q: “Were you allowed to leave the premises.” A: “Yes.” Q: “Did you ever leave the premises during your rest breaks?” A: “No.” Q: “Did anyone ever tell you that you were unable to leave the premises during your rest breaks?” A: “No.” Q: “Do you know if other employees left the premises on their rest break?” A: “I don’t know.” Q: “Were your rest breaks ever interrupted with work matters?” A: “No.” Q: “Did anyone ever ask you to work through your rest breaks?” A: “I don’t recall.” 12 37 20-cv-574-GPC-AHG 1 Because the alleged policy to not permit employees to leave for rest breaks lasted 2 for only 61 days, and only applied to the Riverside facility, class certification would only 3 be possible as to the Riverside employees for that limited period of time. But certification 4 even as applied to that limited set of employees during the applicable period in 2018 is 5 not even proper because individualized issues predominate over common questions. 6 There is an open question as to whether the rest break policy as dictated by the Talking 7 Point was ever even enforced—and how many employees were required to stay on 8 premises during the Policy’s lifetime. Plaintiffs presented evidence that employees were 9 restricted from leaving the premises;13 Defendants presented evidence that employees 10 were not restricted from leaving the premises. Plaintiffs have not established that the 11 common question predominates over even the severely narrowed employees that would 12 make up the Riverside class during the 61 days. Accordingly, certification as to the rest 13 break claim is denied. 14 d. Wage Statement Claim Class Plaintiffs seek to certify a Wage Statement Class, which they define as “all persons 15 16 employed by Defendants at Defendants’ facilities in Riverside and Chula Vista as non- 17 exempt employees during the Class Period, who received at least one wage statement 18 from Defendants.” Pls.’ Mot. at 10. California Labor Code 226(a) requires that employers “furnish to his or her 19 20 employee . . . an accurate itemized statement in writing showing,” among other 21 information, the employee’s “gross wages earned,” “total hours worked by the 22 employee,” “net wages earned,” and “all applicable hourly rates in effect during the pay 23 period and the corresponding number of hours worked at each hourly rate by the 24 employee.” Cal. Lab. Code § 226(a). If an employer fails to satisfy the requirements of 25 26 13 27 28 Pls.’ Mot. at 24 n.11 38 20-cv-574-GPC-AHG 1 226(a), she would be entitled to actual damages or statutory penalties under Section 2 226(e).14 To demonstrate an injury, an employee must show that the employer 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 14 (e) (1) An employee suffering injury as a result of a knowing and intentional failure by an employer to comply with subdivision (a) is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not to exceed an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorney’s fees. (2) (A) An employee is deemed to suffer injury for purposes of this subdivision if the employer fails to provide a wage statement. (B) An employee is deemed to suffer injury for purposes of this subdivision if the employer fails to provide accurate and complete information as required by any one or more of items (1) to (9), inclusive, of subdivision (a) and the employee cannot promptly and easily determine from the wage statement alone one or more of the following: (i) The amount of the gross wages or net wages paid to the employee during the pay period or any of the other information required to be provided on the itemized wage statement pursuant to items (2) to (4), inclusive, (6), and (9) of subdivision (a). (ii) Which deductions the employer made from gross wages to determine the net wages paid to the employee during the pay period. Nothing in this subdivision alters the ability of the employer to aggregate deductions consistent with the requirements of item (4) of subdivision (a). (iii) The name and address of the employer and, if the employer is a farm labor contractor, as defined in subdivision (b) of Section 1682, the name and address of the legal entity that secured the services of the employer during the pay period. (iv) The name of the employee and only the last four digits of his or her social security number or an employee identification number other than a social security number. (C) For purposes of this paragraph, “promptly and easily determine” means a reasonable person would be able to readily ascertain the information without reference to other documents or information. 39 20-cv-574-GPC-AHG 1 “knowing[ly] and intentional[ly] failed to provide accurate and complete information as 2 required by one or more of the Section 226(a) requirements, Cal Lab. Code § 226(e)( and 3 if the employee cannot “promptly and easily” determine from the wage statement the 4 information to which they are entitled. Cal. Lab. Code § 226(e)(3). 5 Plaintiffs allege that Defendants had a policy and practice of providing wage 6 statements to employees that failed to satisfy California Labor Code requirements. Pls.’ 7 Mot. at 20. Specifically, Plaintiffs allege that Defendants “had a central department that 8 processed payroll for all class members, whose wage statements were in substantially 9 [the] same format,” and that the wage statements created for employees were deficient in 10 the following ways: First, they “fail[ed] to show the total hours worked during each pay 11 period”; second, statements “did not include a separate line for the total hours worked 12 during the pay period,”; and third, “when employees received any other forms of 13 renumeration in the same pay period that were not hours worked, employees could not 14 simply add together the categories of ‘Hours’ listed on the wage statements to determine 15 the total hours worked.” Pls.’ Mot. at 29. Further, “the wage statements contain numerous 16 confusing pay codes” that “[e]ven Rohr’s 30(b)(6) witness was unable to explain what 17 many of the different pay codes in the employees’ wage statements referred to.” Id. at 30 18 (citing ECF No. 56-7, Trujillo Dep., at 103-105).15 Finally, “Defendants’ wage statements 19 20 (3) For purposes of this subdivision, a “knowing and intentional failure” does not include an isolated and unintentional payroll error due to a clerical or inadvertent mistake. In reviewing for compliance with this section, the factfinder may consider as a relevant factor whether the employer, prior to an alleged violation, has adopted and is in compliance with a set of policies, procedures, and practices that fully comply with this section. 21 22 23 24 25 26 27 28 In their Reply, Plaintiffs direct the Court to portions of their “Reply Compendium of Evidence” (ECF No. 77) for testimony that purportedly supports Plaintiffs’ contention that employees “did not review their wage statements, did not understand them, or lacked knowledge as to the applicable legal standards.” Reply at 20. However, the portions of 15 40 20-cv-574-GPC-AHG 1 systematically failed to include correct information about the hours worked at each 2 applicable rate of pay, including the applicable shift premium.” Pls.’ Mot. at 30. 3 To support their wage statement theory, Plaintiffs point to Defendants’ common 4 payroll practices, and provide examples of the earning statements received by proposed 5 class representatives Nathaniel Morgan (ECF No. 56-10) and Michael Bevan (ECF No. 6 56-11). For example, Plaintiffs illustrate that Morgan’s earnings statement includes 7 numerous pay code lines some of which are not for hours worked, including 8 “Bereavement” and “Grievance” and omits any lines indicating the total hours worked at 9 each rate of pay. See ECF No. 56-10 at 2; Mot. at 29-30; Reply at 20-21. Plaintiff 10 Bevan’s earnings statement includes a “confusing” pay code which reads 11 “Ot3Rdshf@2X,” and does not state anywhere the total number of hours worked. ECF 12 No. 56-11 at 2; Reply at 21. 13 Defendants counter that “the wage statements list all hours worked” and “[t]here is 14 no requirement to list the sum of all hours; they are sufficient if they list hours by type 15 (i.e., regular and overtime) and employees can do simple match to calculate total hours.” 16 Opp. at 33. Defendants rely on Morgan v. United Retail Inc., 186 Cal. App. 4th 1136 17 (2010) to say that statements which list hours worked are sufficient, ECF No. 67 at 33. 18 However, Plaintiffs rightly distinguish that case. Reply at 20. In Morgan, the court 19 limited its analysis to the “precise issue . . . whether a wage statement complies with 20 section 226 where it separately lists the total number of regular hours and the total 21 number of overtime hours worked by the employee, but does not include an additional 22 line with the sum of those two figures,” 186 Cal. App. 4th at 1144. Here, Plaintiffs have 23 shown that Defendants’ earnings statements include multiple lines of pay codes such that 24 25 26 27 28 the “RC” to which Plaintiffs direct the Court do not include any such testimony related to wage statements or the topics Plaintiffs claim should be elucidated therein. 41 20-cv-574-GPC-AHG 1 an employee may not necessarily be able to easily discern their total number of hours 2 worked in any given pay period. Defendants also argue that McKenzie v. Fed. Exp. Corp., 3 765 F. Supp. 2d 1222 (C.D. Cal. 2011) is not inapposite because, “[u]nlike here, the 4 employer there provided ‘idiosyncratic’ wage statements that listed the same overtime 5 hours twice, resulting in incorrect hours.” Opp. at 33. And Defendants are right that 6 “Plaintiffs offer absolutely no evidence that wage statements did not include the hours 7 worked at each applicable rate of pay.” Id. But, Plaintiffs claims do not rely on that 8 contention at all—instead, they have argued that the earnings statements violate Section 9 226(a) because they failed to allow employees to “promptly and easily determine” the 10 hours worked at each applicable rate of pay without confusion from inscrutable payroll 11 codes as is required by the Labor Code. As Plaintiffs have stated, “whether the wage 12 statements were improper involves a classwide question subject to common proof.” 13 Reply at 21. The Court agrees, and GRANTS class certification as to Plaintiffs’ Wage 14 Statement Class. 15 e. Derivative Claims 16 Plaintiffs also seek to certify three Derivative Claims based on their Sixth, Seventh 17 and Eighth Causes of Action alleged in the Second Amended Complaint. Pls.’ Mot. at 30; 18 SAC at 21-24. The three derivative claims allege Defendants failed to pay putative class 19 members final wages, failed to furnish accurate itemized wage statements, and that 20 Defendants engaged unfair business practices. Pls.’ Mot. at 30. To support certification of 21 these claims, Plaintiffs state that they are derivative of the other claims they seek to 22 certify. Pls.’ Mot. at 30 (citing Westfall v. Ball Metal Beverage Container Corp., No. 23 216CV0263KJMGGH, 2019 WL 202677, *1 (E.D. Cal. Jan. 15, 2019)). 24 As to Plaintiffs’ derivative claim based on the Sixth Cause of Action alleging that 25 “Defendants routinely failed to provide Plaintiffs and Class members with timely, 26 accurate and itemized wage statements,” SAC at 21, this claim is substantially similar to 27 28 42 20-cv-574-GPC-AHG 1 the Wage Statement Claim Plaintiffs seek to certify for the Wage Statement Class. The 2 Court finds that the derivative claim alleging Defendants failed to furnish accurate 3 itemized wage statements is suitable for class certification and GRANTS Plaintiffs’ 4 motion to certify the class as to this claim. 5 As to Plaintiffs’ claim alleging Defendants failed to pay putative class members 6 final wages, Plaintiffs allege that “DEFENDANTS knowingly and willfully failed to 7 indemnify PLAINTIFFS and CLASS MEMBERS for all business expenses and/or losses 8 incurred in direct consequence of the discharge of their duties while working under the 9 direction of DEFENDANTS, including but not limited to, expenses associated with the 10 purchase and maintenance of uniforms, work shoes/boots/insoles, cell phone usage, 11 laundering of uniforms, and other employment-related expenses, in violation of 12 California Labor Code § 2802.” SAC at 22. Plaintiffs have not addressed what common 13 evidence they intend to use to establish Defendants’ liability for the statutory penalties 14 they seek to claim under California Labor Code § 2802(c). See Pls.’ Mot. at 30-31, 15 merely that it is derivative of Plaintiffs’ other claims. It is plausible that the common 16 evidence is similar to that which Plaintiffs would use to demonstrate liability under the 17 Wage Statement Class and the derivative wage statement claim. However, Plaintiffs have 18 not demonstrated why this particular derivative claim about final wages and expenses is 19 suitable for class certification. The Court DENIES Plaintiffs’ motion to certify the 20 derivative claim related to final pay and expenses because Plaintiffs have failed to carry 21 their burden. 22 As to the final derivative claim, based on Plaintiffs’ Eighth Cause of Action 23 alleging Defendants are liable for violations of California Unfair and Unlawful Business 24 Practices (SAC at 23), the Court finds that this derivative claim is suitable for class 25 certification, but only as it relates to the subclasses and underlying claims that this Court 26 has granted class certification in the preceding sections of this Order. 27 28 43 20-cv-574-GPC-AHG 1 2. 2 If a court finds that the proposed class or subclass satisfies the commonality and 3 predominance requirements of Rule 23(b)(3), the court must also determine whether a 4 class action is superior to other available methods for fairly and efficiently adjudicating 5 the controversy. Fed R. Civ. P. 23(b)(3). To determine whether a class action is superior 6 to alternative methods of adjudicating a case, a court considers: (1) the class members’ 7 interests in individually controlling the prosecution or defense of separate actions; (2) the 8 extent and nature of any litigation concerning the controversy already brought by or 9 against proposed class members; (3) the desirability or undesirability of concentrating the 10 litigation of the claims in the particular forum; and (4) the likely difficulties in managing 11 the class. Fed. R. Civ. P. 23(b)(3)(A)-(D). Consistent with the aim of the Federal Rules of 12 Civil Procedure to promote judicial economy, a class action is the superior method for 13 resolution “[w]here classwide litigation of common issues will reduce litigation costs and 14 promote greater efficiency.” Valentino v. Cartier-Wallace, Inc., 97 F.3d 1227, 1234 (9th 15 Cir. 1996). Wage and hour disputes are frequently litigated as class actions. See 16 Ghazaryan v. Diva Limousine, Ltd., 169 Cal. App. 4th 1524, 1538 (2008). Superiority 17 Plaintiffs maintain that a class action is a superior method of adjudicating putative 18 class members’ claims against Defendants. Pls.’ Mot. at 32-33. They argue a class action 19 is superior because “class treatment is clearly superior to hundreds of individual actions” 20 prosecuted by each individual employee, there is no other pending litigation asserting the 21 same claims as Plaintiffs, “this particular forum is desirable because the class members 22 worked in California and California substantive state law will govern the outcome of this 23 case,” and because the class action will be manageable. Id. 24 Defendants’ primary objection is that a class action will not be manageable 25 because Plaintiffs’ proposed two-phase trial plan is “fatally flawed.” Opp. at 34. 26 Defendants argue that, absent a manageable trial plan, Plaintiffs have not satisfied their 27 28 44 20-cv-574-GPC-AHG 1 burden on this prong of the 23(b)(3) analysis. Defendants cite Duran v. U.S. Nat’l Bank 2 Ass’n, 59 Cal. 4th 1, 31 (2014), for the proposition that trial courts must assess whether 3 there is a viable trial plan at the class certification stage. However, Plaintiffs contend this 4 interpretation goes too far and that “Duran does not require a formal trial plan at 5 certification, particularly where, as here [P]laintiffs’ moving papers describe the evidence 6 and methodology they will use to establish liability at trial and discovery has been limited 7 to certification rather than merits issues.” Reply at 21. The Court agrees with Plaintiffs. 8 At least on the claims that the Court found suitable for class certification, as described 9 above, Plaintiffs have described the evidence and analysis they intend to use to 10 demonstrate Defendants’ liability for the claims alleged, primarily Defendants’ 11 timekeeping records for putative class members over the Class Period. Through 12 discovery, further data will be produced and available for Plaintiffs for them to provide 13 common proof as to the common questions they have presented. 14 15 Considering the superiority prong’s four factors, the Court finds that a class action is the superior method for resolving the claims Plaintiffs allege against Defendants. 16 CONCLUSION 17 Accordingly, the Court HEREBY ORDERS that Plaintiffs’ Motion for Class 18 Certification is GRANTED IN PART and DENIED IN PART, as follows: 19 Consistent with the Court’s findings in the Discussion section of this Order, the 20 Court CERTIFIES under Rule 23(b)(3) the following classes and subclasses for union 21 employees during the Class Period: Plaintiffs’ Meal Period Class, Overtime Class, and 22 Minimum Wage Class, and the related subclasses under the automatic deduction of meal 23 break, rounded meal break, first meal break and second meal break, and wage statement 24 claims. The Court also CERTIFIES for union employees during the Class Period 25 Plaintiffs’ derivative claims relating to Defendants’ failure to provide accurate and 26 27 28 45 20-cv-574-GPC-AHG 1 itemized wage statements, and unfair and unlawful business practices under California 2 law. 3 4 5 6 The Court DENIES Plaintiffs’ motion as to all other Classes and subclasses, without prejudice, because Plaintiffs failed to satisfy their burden under Rule 23. IT IS SO ORDERED. Dated: March 31, 2022 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 46 20-cv-574-GPC-AHG

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