Supreme Court Rules on FLSA Collective Action Case

April 25, 2013

pic-supreme-courtThe  U.S. Supreme Court recently weighed in on a case regarding the ability of employees to sue under the Fair Labor Standards Act (FLSA) and how a lawsuit may either be from one sole plaintiff or a group of plaintiffs. FLSA provides that an employee may bring an action to recover damages for specified FLSA violations on behalf of himself and other “similarly situated” employees. A suit brought on behalf of other employees is known as a “collective action.”

In Genesis Healthcare Corp. v. Symczyk, Symczyk alleged that the employer had violated FLSA by automatically deducting 30 minutes of time worked per shift for meal breaks for certain employees, even when the employees performed compensable work during those breaks.

When Genesis answered the complaint, it simul­taneously served upon Symczyk an offer of judgment under Federal Rule of Civil Procedure 68. The offer in­cluded $7,500 for alleged unpaid wages, in addition to “such reasonable attorneys’ fees, costs, and expenses . . . as the Court may determine.” The District Court found that it was undisputed that no other individuals had joined respondent’s suit and that the Rule 68 offer of judgment fully satisfied her individual claim even though she had rejected the offer. It therefore dismissed the case. Symczyk objected, arguing that petitioners were inappropriately attempting to “pick off ” the named plain­tiff before the collective action process could unfold.

On April 16, 2013 the Supreme Court held that if a sole plaintiff’s FLSA collective action claim is mooted, the entire case must be dismissed. The court accepted lower court determinations that the named plaintiff’s claim was moot, and declined to decide whether employers can end a lawsuit by making full offers of judgment to lead plaintiffs in FLSA collective action suits.  This key issue, therefore, remains unclear.

To read the opinion, click here.