Sanchez v. Clipper Realty, Inc.

Background

Rodney Sanchez sued Clipper Realty, Inc., doing business as Clipper Realty; Clipper Realty OP L.P.; Clipper Realty Construction LLC; Clipper 107 CH LLC, doing business as Clover House; and Clipper Equity LLC, doing business as Clipper Equity. He brought claims under the Fair Labor Standards Act (FLSA) and the New York Labor Law, alleging that the defendants used a practice called “time shaving” to avoid paying employees for all hours worked.

Sanchez alleged that employees performed unpaid work during training, meal breaks, before clocking in, during meetings, and after clocking out. He sought conditional certification of an FLSA collective action, which would allow similarly situated employees to receive notice and choose whether to join the case. He also requested approval of a proposed notice, employee contact information, and equitable tolling of the FLSA limitations period.

Conditional Certification

The court held that Sanchez met the modest evidentiary burden required at this preliminary stage. His declaration, declarations from other employees, earnings statements, and analysis of time records supported his allegation that employees were subject to a common policy requiring unpaid work. The court explained that it was not deciding the ultimate merits of the FLSA claims.

The court conditionally certified a collective consisting of:

- porters, handymen, concierges, and repairmen; - who worked at Clover House, 50 Murray Street, or 53 Park Place; and - who worked within the three years before the complaint was filed.

The court rejected the broader proposed group of all non-exempt employees at all of the defendants’ New York locations because Sanchez did not provide enough evidence connecting other job types or locations to the alleged common policy. The court limited the collective by location rather than by supervisor because the evidence did not show that Marc Gordon was personally responsible for the policy across the proposed group.

The court also excluded employees bound by the 2022 addendum to the collective bargaining agreement or by the 2023 collective bargaining agreement, because the court found that those employees were clearly required to arbitrate their FLSA claims. The court did not determine whether particular declarants were covered by those agreements because their employment histories were incomplete.

Notice and Discovery

The court granted in part and denied in part Sanchez’s motion for conditional certification and court-facilitated notice. It approved the proposed notice subject to modifications stating the limited job categories, locations, three-year period, and arbitration-related exclusions. The notice must also explain that potential participants may have to provide information, appear for a deposition, testify in court, and have defense counsel’s contact information.

The court approved a 60-day period for potential members to opt in and allowed notice by mail, email, and text message. It denied, without prejudice to renewal, Sanchez’s request to require production of potential opt-in plaintiffs’ Social Security numbers. It ordered the defendants to provide, within 14 days, the names, titles, compensation rates, last known mailing addresses, email addresses, known telephone numbers, and dates of employment for employees within the putative collective.

Equitable Tolling and Disposition

The court denied Sanchez’s request for equitable tolling of the FLSA limitations period at this time, stating that individual tolling requests could be considered later based on individualized circumstances. The court also denied Sanchez’s letter motion to compel discovery as moot.

Judge Katherine Polk Failla directed Sanchez to submit a revised proposed notice within 14 days for the court’s approval. The court’s order did not decide whether the alleged wage violations occurred or whether the defendants were ultimately liable.