HENSLEY et al v. FIRST STUDENT MANAGEMENT LLC et al, No. 1:2015cv03811 - Document 27 (D.N.J. 2016)
Court Description: OPINION. Signed by Judge Joseph H. Rodriguez on 3/31/2016. (tf, )
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HENSLEY et al v. FIRST STUDENT MANAGEMENT LLC et al Doc. 27 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW J ERSEY KATHY HENSLEY, et. al., : : Plaintiffs, v. Hon. J oseph H. Rodriguez Civil Action No. 15-3811 : FIRST STUDENT MANAGEMENT, LLC, et. al., Defendants. Op in io n : : This m atter com es before the Court on partial Motion to Dism iss [Dkt. No. 4] of Defendants First Student Managem ent, LLC and First Student Inc. (collectively “Defendants” or “First Student”), pursuant to Federal Rule of Civil Procedure 12(b)(6). The Court has considered the written subm issions of the parties and the argum ents advanced at the hearing on March 9, 20 16. For the reasons stated on the record that day and for those that follow, Defendants’ partial m otion to dism iss is granted. I. Backgro u n d Plaintiffs are bus drivers and/ or bus assistants em ployed by Defendants. Plaintiffs bring this action pursuant to the Fair Labor Standards Act (“FLSA”), 28 U.S.C. § 216 (b) and the New J ersey Minim um Fair Wage Act (“NJ MFWA”), N.J .S.A. 34:1156a25. Counts I and II plead claim s for straight tim e and for overtim e pay, respectively, under the FLSA. Counts III and IV of the Com plaint plead claim s for straight tim e and for overtim e pay, respectively, under the NJ MFWA. Defendants m ove only to dism iss Count I, the claim for straight tim e pay under the FLSA, arguing that a claim for straight 1 Dockets.Justia.com tim e pay is not cognizable under the FLSA. This case presents the narrow question of whether the FLSA perm its a claim for straight tim e pay when an allegation has been m ade that an em ployee worked in excess of 40 hours in a workweek and did not receive appropriate overtim e com pensation. Put differently, the Court m ust decide whether a Plaintiff who alleges that he/ she worked in excess of 40 hours but was not paid for the entire 40 hours worked m ay recover, under the FLSA, for both the unpaid overtim e pay and the com pensable unpaid portion – or straight pay— of the hours worked up to 40 hours in a workweek. The Third Circuit has not directly addressed this question. II. Stan d ard o f Re vie w Federal Rule of Civil Procedure 12(b)(6) allows a party to m ove for dism issal of a claim based on “failure to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). A com plaint should be dism issed pursuant to Rule 12(b)(6) if the alleged facts, taken as true, fail to state a claim . Fed. R. Civ. P. 12(b)(6). When deciding a m otion to dism iss pursuant to Rule 12(b)(6), ordinarily only the allegations in the com plaint, m atters of public record, orders, and exhibits attached to the com plaint, are taken into consideration.1 See Chester County Interm ediate Unit v. Pa. Blue Shield, 896 F.2d 80 8, 812 (3d Cir. 1990 ). It is not necessary for the plaintiff to plead evidence. Bogosian v. Gulf Oil Corp., 561 F.2d 434, 446 (3d Cir. 1977). The question before the 1“Although a district court m ay not consider m atters extraneous to the pleadings, a docum ent integral to or explicitly relied upon in the com plaint m ay be considered without converting the m otion to dism iss into one for sum m ary judgm ent.” U.S. Express Lines, Ltd. v. Higgins, 281 F.3d 383, 388 (3d Cir. 20 0 2) (internal quotation m arks and citations om itted) (em phasis deleted). Accord Lum v. Bank of Am ., 361 F.3d 217, 221 n.3 (3d Cir. 20 0 4) (citations om itted). 2 Court is not whether the plaintiff will ultim ately prevail. Watson v. Abington Twp., 478 F.3d 144, 150 (20 0 7). Instead, the Court sim ply asks whether the plaintiff has articulated “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twom bly, 550 U.S. 544, 570 (20 0 7). “A claim has facial plausibility2 when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the m isconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (20 0 9) (citing Twom bly, 550 U.S. at 556). “Where there are well-pleaded factual allegations, a court should assum e their veracity and then determ ine whether they plausibly give rise to an entitlem ent to relief.” Iqbal, 556 U.S. at 679. The Court need not accept “‘unsupported conclusions and unwarranted inferences,’” Baraka v. McGreevey, 481 F.3d 187, 195 (3d Cir. 20 0 7) (citation om itted), however, and “[l]egal conclusions m ade in the guise of factual allegations . . . are given no presum ption of truthfulness.” Wyeth v. Ranbaxy Labs., Ltd., 448 F. Supp. 2d 60 7, 60 9 (D.N.J . 20 0 6) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)); see also Kanter v. Barella, 489 F.3d 170 , 177 (3d Cir. 20 0 7) (quoting Evancho v. Fisher, 423 F.3d 347, 351 (3d Cir. 20 0 5) (“[A] court need not credit either ‘bald assertions’ or ‘legal conclusions’ in a com plaint when deciding a m otion to dism iss.”)). Accord Iqbal, 556 U.S. at 678-80 (finding that pleadings that are no m ore than conclusions are not 2 This plausibility standard requires m ore than a m ere possibility that unlawful conduct has occurred. “When a com plaint pleads facts that are ‘m erely consistent with’ a defendant’s liability, it ‘stops short of the line between possibility and plausibility of ‘entitlem ent to relief.’’” Id. 3 entitled to the assum ption of truth). Further, although “detailed factual allegations” are not necessary, “a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitlem ent to relief’ requires m ore than labels and conclusions, and a form ulaic recitation of a cause of action’s elem ents will not do.” Twom bly, 550 U.S. at 555 (internal citations om itted). See also Iqbal, 556 U.S. at 678 (“Threadbare recitals of the elem ents of a cause of action, supported by m ere conclusory statem ents, do not suffice.”). Thus, a m otion to dism iss should be granted unless the plaintiff’s factual allegations are “enough to raise a right to relief above the speculative level on the assum ption that all of the com plaint’s allegations are true (even if doubtful in fact).” Twom bly, 550 U.S. at 556 (internal citations om itted). “[W]here the well-pleaded facts do not perm it the court to infer m ore than the m ere possibility of m isconduct, the com plaint has alleged-but it has not ‘shown’-‘that the pleader is entitled to relief.’” Iqbal, 556 U.S. at 679 (quoting Fed. R. Civ. P. 8(a)(2)). III. An alys is In this case, Plaintiffs’ claim for straight tim e pay is actually a claim for what is also referred to as “gap tim e” pay. Gap tim e is defined as “uncom pensated hours worked that fall between the m inim um wage and the overtim e provisions of the FLSA.” Adair v. City of Kirkland, 185 F.3d 10 55, 10 59 (9 th Cir. 1999). Many courts, including the Third Circuit, acknowledge that potential subclasses of gap tim e exist: “pure gap tim e” and “overtim e gap tim e.” Davis v. Abington Mem 'l Hosp., 765 F.3d 236, 244 (3d Cir. 20 14) (citing Monahan v. Cnty. of Chesterfield, Va., 95 F.3d 1263, 1272-73 (4th Cir. 4 1996)). “Overtim e gap tim e” pay refers to “gap tim e claim s by an em ployee who exceeds the overtim e threshold, but whose em ploym ent contract does not com pensate him or her for all non-overtim e hours.” Davis, 765 F.3d at 244. In other words, “overtim e gap tim e” pay is com pensation for unpaid hours worked during the course of a 40 hour workweek when a plaintiff alleges that he/ she worked in excess of 40 hours in a workweek and was not com pensated for both overtim e work (work in excess of 40 hours) and straight tim e work (work up to 40 hours).1 The Court finds that the Plaintiffs m ay not recover for overtim e gap tim e pay under the FLSA. The FLSA expressly contem plates claim s for m inim um wage violations and for failure to pay overtim e wages. “The FLSA establishes federal m inim um -wage, m axim um -hour, and overtim e guarantees that cannot be m odified by contract.” Genesis Healthcare Corp. v. Sym czyk, – – – U.S. – – – – , 133 S.Ct. 1523, 1527, 185 L.Ed.2d 636 (20 13). In order to recover under the FLSA, a plaintiff m ust allege either the failure to pay the m inim um wage or a failure to pay for overtim e. 29 U.S.C. §§ 20 1-19. A cognizable claim for overtim e m ust “sufficiently allege 40 hours of work in a given workweek as well as som e uncom pensated tim e in excess of the 40 hours.” Lundy v. Catholic Health System of Long Island Inc., 711 F.3d 10 6, 114 (2d Cir. 20 13) (citing 29 U.S.C. § 20 7(a)(1) (requiring that, “for a workweek longer than forty hours,” an em ployee who works “in excess of” forty hours shall be com pensated tim e and a half for 1 Plaintiffs’ allegation for “straight tim e” is not a “pure gap tim e” claim . “Straight tim e” or “pure gap tim e” seeks redress for uncom pensated hours in a 40 hour work week without overtim e. Because Plaintiffs allege that they worked at least 40 hours in a week plus overtim e hours, or tim e in excess of forty hours, Plaintiffs’ straight tim e claim seeks com pensation for “overtim e gap tim e.” 5 the excess hours)). It is well settled that claim s for straight tim e, also known as “pure gap tim e,” are not cognizable under the FLSA. See 29 U.S.C. §§ 20 1– 19; Davis, 765 F.3d at 244; Monahan, 95 F.3d at 1280 ; Nakahata v. New York-Presbyterian Healthcare System , Inc., 723 F.3d 192, 20 1 (2d Cir. 20 13) (“[T]he FLSA is unavailing where wages do not fall below the statutory m inim um and hours do not rise above the overtim e threshold.”). The Court finds that this prohibition extends to overtim e gap tim e pay. Here, there is no dispute that Plaintiffs satisfy the pleading m andate and allege uncom pensated tim e in excess of 40 hours in a given workweek. See Com pl. ¶¶ 169172.2 At issue is whether Plaintiffs can recover for the straight tim e com ponent of the alleged violation. There is no binding precedent on this issue and the parties agree that the Third Circuit in Davis acknowledged, but did not reach, this nuanced question. Davis, 765 F.3d at 244 (“We need not resolve the issue in this case because, as discussed above, the plaintiffs have not plausibly alleged that they worked overtim e in any given week.”) Indeed, Plaintiffs’ Com plaint invites the very consideration of the FSLA’s reach contem plated by the Third Circuit in Davis. 2 The Com plaint specifically alleges that: On a regular basis, when all of the drivers' hours are properly counted, the drivers work m ore than 40 hours per week [;] Pursuant to the FLSA, plaintiffs and the m em bers of the Proposed FLSA Class are entitled to be paid for all straight time worked during weeks their hours exceed forty (40 ) hours [;] First Student has refused and continues to refuse to pay drivers and their assistants for all straight tim e worked [;] The failure of First Student to pay for all straight tim e worked by the plaintiffs during all weeks these drivers worked m ore than forty (40 ) hours is a violation of the FLSA. Com pl., ¶¶ 169-172. 6 Only two Circuits have directly addressed this issue and the determ ination of the viability of a claim for overtim e gap tim e pay under the FLSA is split. In 1996, the Fourth Circuit in Monahan held that overtim e gap tim e pay is com pensable under the FLSA in lim ited circum stances. Monahan, 95 F.3d at 1273, 1279. In reaching this conclusion, the Monahan court afforded significant weight to the Departm ent of Labor’s policy statem ents and interpretive guidance, codified in 29 C.F.R. §§ 778.315, .317, and .322. Section 778.315, which considers tim e and a half pay, provides: “[t]his extra com pensation for the excess hours of overtim e work under the Act cannot be said to have been paid to an em ployee unless all the straight tim e com pensation due him for the nonovertim e hours under his contract (express or im plied) ... has been paid.” 29 C.F.R. § 778.315. More recently, the Second Circuit in Lundy considered an overtim e gap tim e claim and concluded that the plain text of the FLSA does not afford redress for uncom pensated gap tim e hours. Lundy, 711 F.3d at 116. In its holding, the Second Circuit specifically rejects the Fourth Circuit’s reliance on the Departm ent of Labor’s interpretive statem ents in Monahan. Id. at 117. At first glance, the Fourth Circuit’s reasoning appears pragm atic; it m akes sense “that in order to determ ine overtim e com pensation, one m ust first look to the em ploym ent agreem ent to determ ine whether the em ployer has first paid all straight tim e due under the agreem ent.” Monahan, 95 F.3d at 1273 (quoting 29 C.F.R. § 778.315). Although the language of the C.F.R. m ay infer a claim for overtim e gap tim e pay, this Court agrees with the reasoning of the Second Circuit in Lundy, that such a 7 conclusion results in an expansion of the FLSA. Lundy’s appraisal of the reliability and precedential value of the Departm ent of Labor’s guidance and interpretive statem ents as lacking both “statutory support or reasoned explanation” is persuasive. Lundy, 711 F.3d at 116-17 (“The interpretive guidance on which Monahan relied, insofar as it m ight be read to recognize gap-tim e claim s under FLSA, is owed deference only to the extent it is persuasive: it is not.”); see also, Madison v. Res. for Hum an Dev., Inc., 233 F.3d 175, 185 (3d Cir. 20 0 0 ) (citing Christensen v. Harris County, 529 U.S. 576, 120 S.Ct. 1655, 1662, 146 L.Ed.2d 621 (20 0 0 ) (“Interpretations such as those in opinion letters—like interpretations contained in policy statem ents, agency m anuals, and enforcem ent guidelines, all of which lack the force of law—do not warrant Chevron-style deference.”)). The plain language of the FLSA “requires only paym ent of m inim um wages and overtim e wages. See 29 U.S.C. §§ 20 1– 19. It sim ply does not consider or afford a recovery for gap-tim e hours.” Lundy, 711 F.3d at 116; see also Spencer v. First Student Managem ent, LLC, No. 15-CV- 90 69, 20 16 U.S.Dist. LEXIS 21212 (N.D. Ill. Feb 22, 20 16); Gom ley v. Crossm ark, Inc., No. 1:13-CV-0 0 420 , 20 15 U.S. Dist. LEXIS 540 37, *16 (D. Idaho Apr. 22, 20 15) (“The plain language of the FLSA does not encom pass gap tim e pay — whether it be pure gap tim e or overtim e gap tim e.”)). Here, to the extent that the FLSA leaves a gap in full redress for Plaintiffs, that gap is filled by application of the rem edies afforded by state law, in the form of the NJ MFWA. “In this way federal law supplem ents the hourly em ploym ent arrangem ent with features that m ay not be guaranteed by state laws, without creating a federal rem edy for all wage disputes—of which the garden variety would be for paym ent of 8 hours worked in a 40 – hour work week.” Lundy, 711 F.3d at 116. The question of whether “Plaintiffs are entitled to be paid for all tim e worked including the tim e within the tolerance setting, plus the undocum ented prelim inary activity tim e and the postlim inary activity tim e[,]” see Com p., at ¶ 161, is a question best answered by application of state law. See, e.g., Lundy, 711 F.3d at 116, n.8 (citing Koelker v. Mayor & City Council of Cum berland, 599 F.Supp.2d 624, 635 n. 11 (D.Md. 20 0 9) (criticizing Monahan and noting the state courts are better “positioned” to handle “the contractual interpretation and determination of straight tim e com pensation[.]”)). Here, Plaintiffs agree that the claim s for straight tim e pay are cognizable under the NJ MFWA. The NJ MFWA is the appropriate lens to consider the m erits of Plaintiffs’ straight tim e claim s. Although the Com plaint is plead carefully in an attem pt to fit within the confines of the applicable law governing FLSA claim s, Count I does not allege that Defendants failed to pay m inim um wage or com pensate overtim e hours. Com pensation for overtim e hours worked is plead in Count II. The Court finds that Plaintiffs’ claim for straight tim e (overtim e gap tim e) under the FLSA as plead in Count I is not cognizable. Defendants’ m otion to dism iss Count I is granted. IV. Co n clu s io n For the reasons stated herein, and those set forth on the record on March 9, 20 16, Defendants’ m otion to dism iss Count I is granted. An appropriate Order shall issue. Dated: March 31, 20 16 s/ J oseph H. Rodriguez HON. J OSEPH H. RODRIGUEZ, United States District J udge 9
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