Accessibility of Retailer Websites Under the Americans with Disabilities Act (ADA)

By Thomas J. Barton

Title III of the ADA provides that “no individual shall be discriminated against on the basis of disabilities in the full and equal enjoyment of the goods, services, facilities, privileges, advantages or any accommodations of any place of public accommodation….” 42 U.S.C. §12812(a). When the ADA was enacted in 1991, Congress contemplated physical access to places of public accommodation, such as hospitals, schools, housing, restaurants, and retail stores. At that time, Congress did not foresee the rise of the internet or the proliferation of sales of goods and services through retail websites, and therefore did not provide any guidance as to whether or the extent to which retail websites were governed by the ADA’s accessibility requirements.

Originally initiated by the National Federation for the Blind and other advocacy groups, a cottage industry has sprung up challenging accessibility to retail websites by the blind and visually impaired. Every major retailer has been or will soon be subject to these claims. The plaintiffs’ law firms that regularly bring these cases use a handful of blind or visual impaired individuals on a repeating basis.

These lawsuits, which have been filed against retailers such as Sears, Footlocker, Target, and Toys R Us, allege that experts working on behalf of their blind and visually impaired clients have investigated the company websites and have identified limitations and obstacles in the ability of a blind or visually impaired individual to navigate the websites effectively with screen readers or other assistive devices. The failures include the failure of the website to provide alternative explanations of “non-text content,” such as illustrations, and alternatives to non-text prompts or navigational features. The plaintiffs allege that websites are in fact places of public accommodation under the ADA and seek attorneys’ fees and broad remedial relief that requires significant changes to the website’s format, program and content that permit access by the blind and visually impaired.

But the “fix” is easier said than done. First, the courts have not definitely ruled that websites are places of public accommodation covered by Title III, and even presuming they are, there are no current regulations defining the level of accessibility. The plaintiffs’ bar has assumed that the Web Content Accessibility Guidelines (WCAG) AA 2.0, published by the World Wide Web Consortium, are the appropriate compliance standard under the ADA because the United States Department of Justice has adopted the WCAG standards for federal agencies and federal contractors. Also, the Department of Justice has indicated that it intends to issue proposed rules for the private sector, but this proposed rulemaking, now scheduled for July 2016, has been postponed several times in recent years, and many believe that it will be delayed again.

Second, the WCAG’s are themselves vague, subject to broad interpretation and, in many cases difficult to implement. This problem is further compounded when one attempts to apply these standards under the ADA’s language that speaks to “reasonable access,” “alternative means of compliance,” and “under burden.” The truth is that the vast majority of websites are not 100 percent compliant, and none will be because the websites are constantly changing and adding additional content. For example, retailers are increasingly using third-party content, which is often not accessible to the visually impaired.

To illustrate this point, the websites of the National Federation for the Blind (NFB) and the law firms that bring these cases are themselves far from 100 percent compliant. Software programs that are used to conduct preliminary evaluations of websites typically give the website a score or grade. NFB’s website scored a “C+” at one time but has since improved. No website of which this author knows has scored an “A.” Given that 100 percent compliance is not practical, what level of compliance is sufficient? The courts have yet to address this question because very few cases have been litigated on the merits.

When litigating these lawsuits, retailers should consider the appropriate level of achievable compliance and the timeframe involved. Engaging with knowledgeable internal IT personnel or with external IT consultants is important to do at the outset. The cases are as much or more about the technical aspects of website compliance and implementation as they are about the law.
In these lawsuits, the plaintiffs typically propose broad remedial relief that includes development of compliance policies, training, on-going monitoring, and appointment of outside consultants. Each of these individual components has to be considered carefully.

These lawsuits are often brought as individual actions, presumably to permit a quick settlement and to avoid the challenges posed by Rule 23 class certification standards and court approval. Nonetheless, as individual actions, there is no legal bar to additional lawsuits by other individuals. However, the settlements can be confidential.

These lawsuits are not just about remedial relief; they are also about legal fees. In some cases, plaintiffs’ counsel proposes an attorneys’ fee award that is based on the number of URLs or websites, rather than on the reasonable amount of attorney time that would be involved in bringing the case to settlement, which is the appropriate legal standard. Their theory is that the plaintiffs’ attorneys have to pay for future monitoring of the website(s) to ensure compliance with the settlement terms.

Given the nuances of such claims, retailers are well-advised to use experienced counsel that is familiar with these lawsuits to handle the defense.

Takeaways

  • Seemingly, the courts will likely eventually find that private retail websites are places of public accommodation under the ADA, even though such a result was never considered by Congress when the ADA was enacted.
  • Although the plaintiffs’ bar has “assumed” that the courts will require compliance with the WCAG 2.0 AA, it is far from clear what will constitute compliance in a particular case.
  • Retailers that have not faced this issue should conduct evaluations of their websites to determine their levels of compliance, the costs, and the realistic time frames for any remediations. Retailers should use the appropriate legal and IT expertise.
  • Latent privacy claims may surround notice and acceptance of the websites’ terms and conditions of use.

Although some retailers are currently being assailed, the claims will no doubt expand to the education, finance, professional services, and healthcare industries, all of which should conduct a similar analysis of their websites.

Paid Parental Leave: San Francisco Will Require Employers to Provide Paid Leave and California Will Increase Benefits Available Under State Law

By Kate S. Gold, Mark E. Terman, Ramon A. Miyar, and Vik C. Jaitly

On Tuesday, April 5, 2016, the San Francisco Board of Supervisors unanimously approved legislation that would require private employers in the city to provide partial compensation to employees taking leave to bond with a newborn child under the California Paid Family Leave (“PFL”) program. In practice, when combined with existing partial wage replacement from the PFL program, employees who earn up to a maximum of $106,000 annually will receive complete wage replacement during a covered parental leave as a result of the legislation. If the ordinance is signed into law, San Francisco will become the first municipality in the United States to enact such a program.

Before becoming law, the proposed legislation will need to be approved in a second vote by the Board of Supervisors and signed by Mayor Edwin Lee. At this point, these procedures are considered formalities, and the proposed ordinance is widely expected to take effect in its present form.

Under existing state law, employees in California who contribute to the California SDI fund are entitled to six weeks of partial pay (55%) each year while taking leave to care for a seriously ill family member or new child under the state’s PFL program.  When such leave is taken to care for a newborn child, newly adopted child, or new foster child, the new San Francisco ordinance would require employers to make up the difference by providing employees with the remaining 45% of the employee’s normal gross weekly wage for up to six weeks. Once the wage replacement rate paid under the California PFL program increases, as it is expected to do in 2018, the San Francisco ordinance would require employers to pay the remainder of an employee’s gross weekly wage based on the new state rate.

When Will the Legislation Take Effect, and Who Will It Cover?

If signed into law in its present form, the legislation will take effect in three phases. Starting on January 1, 2017, San Francisco employers with 50 or more employees will be required to pay employees at least 45% of their regular gross weekly wage during the six-week leave period. On July 1, 2017, the legislation will expand to include San Francisco employers with 35 or more employees. Finally, on January 1, 2018, it will apply to employers with 20 or more employees.Employers will only be required to provide the 45% wage replacement to employees who (1) have worked for the employer for at least 180 days; (2) work at least eight hours per week; (3) spend at least 40% of their total weekly hours within the city limits of San Francisco; and (4) are otherwise eligible to receive paid family leave under the PFL program for the purpose of bonding with a new child. In addition, the legislation establishes a maximum cap on wage replacement. The maximum weekly benefit is defined by reference the maximum benefit available under the state PFL law. Thus, under existing regulations, San Francisco employers would be required to pay a maximum of $924 per week (which equals 45 percent of an annual salary of $106,740).

Employers will only be required to provide the 45% wage replacement to employees who (1) have worked for the employer for at least 180 days; (2) work at least eight hours per week; (3) spend at least 40% of their total weekly hours within the city limits of San Francisco; and (4) are otherwise eligible to receive paid family leave under the PFL program for the purpose of bonding with a new child. In addition, the legislation establishes a maximum cap on wage replacement. The maximum weekly benefit is defined by reference the maximum benefit available under the state PFL law. Thus, under existing regulations, San Francisco employers would be required to pay a maximum of $924 per week (which equals 45 percent of an annual salary of $106,740).

San Francisco Employers Will Be Required to Cover a Smaller Portion of Employees’ Wages When Benefits Paid Under the California PFL Law Increase in 2018.

Based on state legislation signed by Governor Jerry Brown this week (A.B. 908), starting on January 1, 2018, the wage replacement rate paid under the California PFL program will increase from 55% to 60% for employees who earn more than 33% of the California average weekly wage. The rate will increase to 70% for employees who make up to 33% of the average weekly wage in California. Once the higher PFL rates take effect, the net payment obligation of San Francisco employers will fall by a corresponding amount. Thus, starting January 1, 2018, San Francisco employers’ wage replacement obligation will decline from 45% to either 30% or 40% of each covered employee’s weekly wages, depending on the size of the relevant employee’s weekly earnings relative to the state average.

Employees Who Quit Within 90 Days of Returning from Leave Are Required to Reimburse the Employer for the Supplemental Income They Received During Their Leave.

As a precondition to receiving supplemental wage replacement during their leave, covered employees under the San Francisco legislation will be required to sign a form agreeing to reimburse the full amount of supplemental compensation paid by their employer if (1) they voluntarily quit within 90 days of the end of their leave period; and (2) the employer requests the reimbursement in writing.

Employers May Require Employees to Exhaust Some Paid Vacation to Satisfy Their Wage-Replacement Obligations.

If the San Francisco legislation takes effect in its current form, employers, if they wish, may require the employee to exhaust up to a maximum of two weeks of unused, accrued vacation time to help satisfy the employer’s obligation to provide supplemental wage replacement during the leave.

Penalties for Non-Compliance.

An employee alleging non-compliance with the ordinance may file a complaint with the San Francisco Office of Labor Standards Enforcement (“OLSE”). In addition, in its current form, the ordinance authorizes “the City” or “any person or entity acting on behalf of the public as provided for under applicable State law” to bring a civil action in a court of competent jurisdiction for the non-payment of replacement wages and corresponding civil penalties.

Three Steps to Prepare for the Labor Department’s Proposed Rule on Paid Sick Leave

By Lynne Anderson

The U.S. Department of Labor (DOL) released a proposed rule that requires federal contractors and subcontractors to provide workers with seven days of paid sick leave on an annual basis. The proposed rule, released on Feb. 25, was created in response to President Barack Obama’s Executive Order 13706, which directed the DOL to issue and finalize regulations this year.

The proposed rule is projected to extend paid sick leave to more than 800,000 employees, 400,000 of which don’t currently receive any paid sick leave, within a five-year period, according to DOL estimates.

Although the DOL has extended the comments period on the proposed rule through April 12, employers and human resources professionals should start preparing for implementation. Here are three things companies can do to prepare:

1. Review and revise policies

HR professionals should compare their employer’s existing policies with the proposed rule to see where revisions are needed. Employers may find that the changes are not as drastic as expected, and they can plan for changes in existing policies to comply with the proposed rule.

For example, the proposed federal rule explains that existing sick leave policies can be used to satisfy the new requirements if they provide at least as much paid time off (i.e., 56 hours a year), and allow the employee to use the existing time off for the reasons covered by the new rule. Many employers likely already have similar policies in place, especially if they have employees in states and municipalities that currently require paid time off for attending to family illnesses, or if the employee has been a victim of domestic violence, including California, Connecticut, Philadelphia, New York City and Seattle, among others.

2. Track and evaluate employee reasons

Employers should also confirm that they are tracking the reasons why employees are taking time off from work. This is already important in terms of compliance with the Family and Medical Leave Act (FMLA) and corresponding state laws, and will make it easier to comply with the record keeping obligations under the new law. We often find that records may inaccurately report that the employee took vacation when the time was actually taken due to an employee’s illness or to care for a sick family member.

3. Document and verify

The proposed rule allows employers to require certification from an employee’s health care provider attesting to the need for leave if the employee is/was absent for three or more consecutive full work days, as is done in the context of FMLA leave or when providing time off as a reasonable accommodation under disability laws. That will help to prevent any possible misuse of the benefit.

Existing leave laws and the proposed rule also require employees to give as much advance notice as practicable regarding the need for paid time off. Employers should require compliance with reasonable “call-out” policies to minimize the disruption caused by absences covered by applicable leave laws.

The future of paid sick leave

While it is possible that this proposed rule may not come to fruition following the presidential election in November, it is indicative of a larger national push for paid sick leave. We are seeing a trend towards allowing employees to use sick time for reasons covered by this proposed new rule, such as care of family members. We are also seeing a trend in employers adopting general ‘PTO’ or paid time off policies that combine days off for personal time, such as attending a child’s school function or a routine doctor appointment, with vacation time and sick time.

With many state and local governments already leaning towards adding paid sick leave benefits, it would be wise for federal contractors and subcontractors to review their policies and make sure they are in compliance with this proposed rule.

Have a Seat: The California Supreme Court Clarifies the Wage Orders’ Suitable Seating Rules

By Philippe A. Lebel and Thomas J. Barton

On April 4, 2016, the California Supreme Court issued an opinion concerning the Industrial Welfare Commission’s (IWC) Wage Orders’ suitable seating rules. According to the California Supreme Court, whether an employer must provide seating while employees are actively engaged in duties depends on employees’ tasks performed at given work locations. The Court determined that if the tasks being performed at any given location reasonably permit sitting, and provision of a seat would not interfere with performance of any other tasks that may require standing, an employer must provide a seat. The Court held that the determination of whether work “reasonably permits” sitting is a question to be resolved objectively, based on the totality of the circumstances. While an employer’s business judgment and the physical layout of the workplace are relevant factors, they are not dispositive. However, an employer’s preference that employees stand and/or individual employees’ physical characteristics are not to be considered. Finally, the Court held that the burden of establishing that no suitable seating is available falls on the employer.

The Wage Orders’ Seating Provisions

Over a century ago, the California Legislature established the IWC to investigate various industries and to promulgate Wage Orders establishing minimum wages, maximum work hours, and conditions of labor. The majority of Wage Orders currently in effect contain a section devoted to the provision of seating to employees—Section 14. Section 14(A) of the Wage Orders in question provides that “employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats.” Section 14(B) provides that “when employees are not engaged in the active duties of their employment and the nature of the work requires standing, an adequate number of suitable seats shall be placed in reasonable proximity to the work area, and employees shall be permitted to use such seats when it does not interfere with the performance of their duties.”

The Issues from Kilby and Henderson

The certified questions before the California Supreme Court arose from two related federal appeals, Kilby v. CVS Pharmacy, Inc. and Henderson v. JPMorgan Chase Bank NA. The cases involved application of identical seating provisions contained in Wage Orders 7 (Mercantile Industry) and 4 (Professional, Technical, Clerical, Mechanical and Similar Occupations), respectively.

In Kilby, the plaintiff, a CVS Pharmacy, Inc. (CVS), customer service representative, sought to represent other CVS retail employees who, like her, were denied seats while performing their jobs. The plaintiff’s duties in Kilby included operating a cash register, straightening and stocking shelves, organizing products in front of and behind the sales counter, cleaning the register, vacuuming, gathering shopping baskets, and removing trash. The district court concluded that Sections 14(A) and 14(B) of the applicable Wage Order were mutually exclusive. It reasoned that section 14(A) applied when an employee was actually engaged in work, while section 14(B) applied when an employee was not actively working. In evaluating the “nature of the work” under Section 14(A), the district court held that an employee’s entire range of assigned duties had to be considered together. Because it was undisputed that some of the performed duties required the employee to stand, the district court ruled that the plaintiff was not entitled to seating during her work time and granted summary judgment for CVS. The plaintiff appealed.

Henderson was a putative class action brought by three bank tellers at JPMorgan Chase Bank NA (Chase). Chase tellers had duties associated with their teller stations, including accepting deposits, cashing checks, and handling withdrawals. They also had duties away from their stations, such as escorting customers to safety deposit boxes, working at the drive-up teller window, and making sure that automatic teller machines were working properly.  These duties varied, depending on the shift or branch location and on whether the employee was a lead or regular teller. On the basis of these differences, the district court denied class certification, and the plaintiffs appealed.

Faced with Kilby and Henderson, the Ninth Circuit certified three questions for the California Supreme Court to answer:

  • Does the phrase “nature of the work” (used in Section 14 of most Wage Orders) refer to individual tasks that are performed throughout the workday, or to the entire range of an employee’s duties that are performed during a given day or shift?
  • When determining whether the nature of the work “reasonably permits” use of a seat, what factors should courts consider? Specifically, are an employer’s business judgment, the physical layout of the workplace, and the characteristics of a specific employee relevant factors?
  • If an employer has not provided any seat, must a plaintiff prove that a suitable seat is available in order to show that the employer has violated the seating provision?

A Location-Driven “Nature of the Work” Standard

As to the first certified question, the defendants argued that examining when the “nature of the work reasonably permits the use of seats” requires consideration of an employee’s job as a whole, i.e., a “holistic” consideration of all of an employee’s tasks and duties throughout a shift. In the defendants’ eyes, if the majority of an employee’s duties favored standing, no seat would be required. By contrast, the plaintiffs argued that whether the “nature of the work reasonably permits the use of seats” turns on a task-by-task evaluation of whether any single task may feasibly be performed seated. In their eyes, if any individual task could be done sitting down, a seat had to be provided.

The California Supreme Court, however, took a middle-of-the-road approach instead. The Court held that, when evaluating whether the “nature of the work reasonably permits the use of seats,” courts must examine subsets of an employee’s total tasks and duties by location, such as those performed at a cash register or a teller window, and must consider whether it is feasible for an employee to perform each set of location-specific tasks while seated. According to the Court, the focus should be on the actual tasks performed by employees (or those reasonably expected to be performed), as opposed to abstract characterizations, job titles, or job descriptions. In the Court’s view, tasks that are performed with more frequency or for a longer duration are more germane to the seating inquiry than tasks performed briefly or infrequently.

The Court also clarified that Section 14(A) and 14(B) of the Wage Orders are not mutually exclusive, although they do not apply at the same time. If an employee’s actual tasks at a discrete location make seated work feasible, he or she is entitled to a seat under Section 14(A) while working there. However, if other job duties take the employee to a different location where he or she must perform tasks while standing, the employee would be entitled to a seat under Section 14(B) during “lulls in operation.”

The Multifactor “Reasonably Permits” Analysis

According to the California Supreme Court, whether an employee is entitled to a seat under Section 14(A) depends on the totality of the circumstances. The analysis starts with an examination of the relevant tasks, grouped by location, and whether the tasks can be performed while seated or require standing. In undertaking this analysis, consideration must be given to the feasibility of providing seats. Feasibility considerations may include, for example, an assessment of whether providing a seat would unduly interfere with other standing tasks, whether the frequency of transition from sitting to standing may interfere with the work, or whether seated work would impact the quality and effectiveness of overall job performance. The analysis is to be qualitative in nature—not a rigid counting of tasks or amount of time spent performing them.

The Court held that an employer’s business judgment about the nature of work could be considered. However, the Court rejected the notion that an employer’s mere preference for standing—as opposed to sitting—could be part of the analysis.

As to work location, the Court held that the physical characteristics of the area where the work is performed should be part of the assessment. On the other hand, just as an employer’s preference for standing could not constitute a relevant “business judgment,” the Court held that employers are not permitted to deliberately design workspaces to further a preference for standing or to deny a seat that might otherwise be reasonably suited for the contemplated tasks.

Finally, the Court held that the analysis should focus on the nature of the tasks at issue and should take into account the location where they are to be performed, as opposed to specific employees’ experiences and abilities in performing tasks. Thus, whether a seat is required depends on the work, as opposed to the physical characteristics of any employees.

Showing That Seating Is Not Feasible Is an Employer’s Burden

The California Supreme Court also held that an employer that seeks to be excused from Section 14(A) bears the burden of showing that compliance is infeasible because no suitable seating exists. There is no obligation on plaintiffs to demonstrate that they requested a seat or that it would be feasible to provide seating for any position.

Takeaways

While the California Supreme Court’s opinion clarifies the Wage Orders’ seating requirements, it may require many California employers to dramatically alter their work environments by providing employees with seats. The decision has particularly significant implications for employers in customer-facing environments where seating may be less common and more difficult to implement, including in the retail and hospitality industries.

In light of this new guidance, employers who do not currently provide seats at all times should examine the nature of their employees’ job duties and work environments to determine whether certain types of work (and work locations) are amenable to seated employees. In addition, employers should ensure that they have suitable seats for employees when they are not actively engaged in their duties. For assistance with ensuring compliance, employers should seek advice from qualified California employment counsel.

Tyson Foods Ruling Opens the Door for Use of Statistical Averaging in Wage and Hour Class Actions

By Thomas J. Barton and Ramon Miyar

Last week, in Tyson Foods, Inc. v. Bouaphakeo et al., No. 14-1146, the United States Supreme Court ruled that class certification was appropriate in a wage and hour class and collective action, despite the lack of individualized evidence for the amount of uncompensated time worked by each class member. The Court instead allowed the employees to use a statistical expert who conducted representative time studies to determine the average number of minutes that the employees spent on pre-shift and post-shift activities. The Court rejected Tyson’s arguments against the use of representative sample averaging, including Tyson’s reliance on Wal-Mart Stores. Inc. v. Dukes, 564 U.S. 338 (2011), which denied certification in a nationwide Title VII class because liability and damages would require individualized proof.

Plaintiff employees in Tyson worked at Tyson Foods, Inc.’s (“Tyson”) pork-processing facility in Storm Lake, Iowa, in the “kill,” “cut,” and “retrim” departments. In the course of their duties, they were required to wear protective gear, the composition of which varied with the tasks that each worker performed on any given day. During the applicable class period, Tyson paid some employees for donning and doffing activities, but did not compensate others at all. Tyson did not record the amount of time that each employee spent donning and doffing.

Arguing that the time that they spent donning and doffing protective gear was an integral part of their hazardous work, Tyson employees filed a lawsuit in the United States District Court for the Northern District of Iowa (“District Court”). In their complaint, plaintiffs alleged that Tyson’s failure to compensate them for donning and doffing resulted in the denial of overtime compensation under the Fair Labor Standards Act (FLSA), 29 U.S.C. § 207(a), and the Iowa Wage Payment Collection Law, Iowa Code § 91A.3. Plaintiffs sought certification of their Iowa wage claims as a class action under Rule 23 of the Federal Rules of Civil Procedure (“Rule 23”), and of their FLSA claim as a “collective action” under 29 U.S.C. § 216.

To certify a class action under FRCP Rule 23, the trial court must find that “questions of law or fact common to class members predominate over questions affecting individual members.” The most significant issue in Tyson was whether the time spent donning and doffing protective gear was compensable work under the FLSA; a question common to the entire class. However, in order to recover damages, a second important question was whether each employee could prove the amount of time spent donning and doffing their equipment and whether that time constituted overtime work in any work week.

In opposition to plaintiffs’ class certification motion, Tyson contended that, because of the variance in protective gear that each employee wore, the employees’ claims were not sufficiently similar to be resolved on a class-wide basis. The District Court rejected that position and concluded that there were common questions susceptible to class-wide resolution, including (1) whether the donning and doffing of protective gear could be considered work under the FLSA; (2) whether such work was integral and indispensable to the plaintiff employees’ work; and (3) if compensable, whether such work was de minimis. The District Court accordingly certified a Rule 23 class of 3,344 employees with respect to plaintiffs’ claims under Iowa law, and a class of 444 opt-ins under the FLSA.

At trial, to establish Tyson’s liability for overtime, each employee was required to show that he or she worked more than 40 hours each week, inclusive of time spent donning and doffing. Because no records of time spent donning and doffing existed, however, plaintiffs relied on a study performed by an industrial relations expert, who conducted 744 videotaped observations, recorded the amount of time that various donning and doffing activities took, and calculated an average for each department. The data from this statistical sampling yielded an average of 18 minutes a day for the cut and retrim departments and 21.25 minutes for the kill department.

Relying on this data, plaintiffs furnished another expert who estimated the amount of uncompensated time worked by each employee by adding the average donning and doffing time to the compensable/recorded time reflected in plaintiffs’ existing time records. Using this methodology, plaintiffs’ expert estimated that 212 employees did not meet the 40-hour threshold and could not recover damages for unpaid overtime; the remaining class members, however, had potentially been uncompensated to some degree.

Crucially, Tyson failed to challenge the validity of the statistical sampling and analyses prepared by plaintiffs’ experts in a hearing under Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), and made no effort to rebut the evidence with an expert of its own. Instead, echoing its arguments in opposition to class certification, Tyson argued to the jury that the variable amount of time that it took employees to don and doff different varieties of protective equipment made the lawsuit “too speculative for class-wide recovery.” Ultimately, although the calculations of plaintiffs’ experts supported an aggregate award of $6.7 million dollars, the jury returned a verdict of only $2.9 million in damages for unpaid wages. A subsequent ruling on liquidated damages upped the total award to $5.8 million.

Relying on Wal-Mart v. Dukes and other authority, on appeal, Tyson strenuously argued that the amount of time spent donning and doffing protective gear varied from person to person and required individualized inquiries, thus rendering class treatment improper. Rejecting this argument, the Court ruled that Wal-Mart did not stand for the broad proposition that a representative sample is an impermissible means of establishing class-wide liability. Wal-Mart involved, in part, a claim that supervisors misused their discretion in hiring and promoting female employees. The employees could not point to a common policy and instead proposed using a “sample set of selected class members” to determine both liability and damages for the entire class. The Court rejected the Wal-Mart plaintiffs’ proposed methodology as “trial by formula.”

By contrast, the Tyson Court noted there was a common policy with respect to liability, and the time study could be introduced in each individual claim to determine that employee’s overall hours for the week. The Court further noted that, unlike Wal-Mart, the Tyson employees all worked in the same facility, did similar work, and were paid under the same policy. The Court also was influenced by the principle that Tyson’s failure to keep records should not be used against the employees. In this respect, the Court relied heavily on its opinion in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 686-688 (1946), to hold that so long as “each class member could have relied on the sample to establish liability if he or she had brought an individual class action, . . . that sample [could serve] as a permissible means of establishing the employees’ hours” on a class-wide basis. Tyson, slip op. at 11.

Takeaways

Tyson does not necessarily erode the holding of Wal-Mart because, as the Court was careful to note, the two cases are so factually and legally different. However, in Title VII employment discrimination class actions, the courts may be open to smaller class actions involving employees who work in the same facility, perform similar tasks, or are supervised by common management.

Tyson’s ramifications for wage and hour class actions are far greater. The Tyson method of proving damages could be applied to other “off the clock” wage and hour class actions, such as pre-shift and post-shift administrative or maintenance work, missed lunch and meal breaks, security checks, or travel between job sites.

Finally, the Court assumed, without deciding, that the standards for certifying an FLSA collective action and a Rule 23 class action are the same. This may be significant because the relative sizes of the classes are different, with the FLSA collective action usually being much smaller. Several federal circuit courts of appeal have held that the standards for certifying an FLSA collective action and a Rule 23 class action are not the same. The Court may be forecasting that it will have to decide this issue in the future.

For further information about this alert, please contact the authors above or any member of our Labor and Employment Practice Group.