Stewart v. Summit Health Management, LLC

Background

Deshanee Stewart and Sevaria Wills brought a proposed class action against Summit Health Management, LLC, doing business as CityMD, and City Practice Group of New York LLC, also doing business as CityMD. They alleged violations of the Fair Labor Standards Act (FLSA), the New York Labor Law (NYLL), the New York State Human Rights Law (NYSHRL), and the New York City Human Rights Law (NYCHRL).

The complaint alleged that patient-care and service representatives were not paid for work before computers finished rebooting, work after clocking out, or short breaks of less than 20 minutes. Wills also alleged that, before May 2019, Summit used one-directional rounding: employees who clocked in early were paid only from their scheduled start time, while employees who clocked in late were paid from their actual clock-in time. The plaintiffs also alleged that Summit failed to provide required wage notices and wage statements.

Stewart separately alleged that Manager Sueda repeatedly changed the schedules of Stewart and another Black employee on short notice, while not making similar changes to non-Black employees. Stewart also alleged that Sueda called them “passive-aggressive” and “uncooperative,” and that Summit terminated Stewart’s employment.

Rule 12(b)(6) standard

Summit moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint alleges enough facts to state a plausible claim. The court had to accept well-pleaded factual allegations as true and draw reasonable inferences for the plaintiffs, but it did not have to accept conclusory statements. The court emphasized that this stage does not decide the evidence or whether the plaintiffs will ultimately prevail.

Wage-and-hour claims

The court denied the motion to dismiss the claims based on pre- and post-shift work. Stewart alleged that, from approximately March 2022 until the end of her employment, she was scheduled to work 42 hours per week and continued assisting patients after clocking out about twice a week for 10 to 15 minutes each time. Wills alleged that she was scheduled to work 48 hours per week and was subject to the same post-shift work. The court held that these allegations plausibly showed work beyond 40 hours in a week, including unpaid time that could support overtime claims under the FLSA.

The court denied the motion as to Stewart’s short-break claim because she identified a specific week—October 9, 2021—during which she allegedly worked more than 42 hours and was not paid for a short break of less than 20 minutes. The court granted the motion as to Wills’s short-break claim because Wills did not allege that she personally took any such breaks or that she regularly took uncompensated short breaks during relevant weeks.

The court denied the motion to dismiss Wills’s one-directional-rounding claim. It held that Wills’s allegations about her personal experience and Summit’s 2017 handbook policy sufficiently alleged a rounding policy that favored the employer and systematically underpaid employees. The court rejected Summit’s argument that other portions of its timekeeping policy undermined the claim at the motion-to-dismiss stage.

Leave to amend

The court rejected Summit’s argument that the short-break and rounding theories should be dismissed because the plaintiffs had not raised them during the pre-motion conference. The court concluded that both theories fell within the permission previously given to amend allegations concerning unpaid wages and uncompensated off-the-clock work.

Wage notices and statements

The court granted Summit’s motion to dismiss the claim under the New York Wage Theft Prevention Act (WTPA), which requires certain wage information at hiring and with wage payments. The court held that the plaintiffs had not alleged a sufficiently concrete injury connected to the missing notices and statements. Their allegations that the missing information delayed payment and caused difficulty paying bills did not adequately connect those injuries to the notice violations, rather than to the alleged wage violations themselves.

Race-discrimination claims

The court denied the motion to dismiss Stewart’s claims under the NYSHRL and NYCHRL. It held that repeated last-minute schedule changes could qualify as a materially adverse change in working conditions because they allegedly interfered with Stewart’s ability to plan and maintain consistency in her life. Stewart also alleged that the manager made these changes to her and the only other Black employee at the location, but not to non-Black employees. The court found those allegations sufficient to support a plausible inference that race was a motivating factor.

The court found that Stewart’s termination could qualify as an adverse employment action but held that the complaint did not adequately connect the termination to her race. It also found that the “passive-aggressive” and “uncooperative” descriptions, standing alone, were facially neutral and did not themselves establish discrimination. The schedule-change allegations nevertheless were sufficient for the discrimination claims to proceed. The opinion’s final discussion refers to “Wills” when describing these discrimination claims, but the surrounding analysis concerns Stewart; this appears to be a clerical error in the opinion.

Disposition

The court granted in part and denied in part Summit’s motion to dismiss. Specifically, it denied dismissal of both plaintiffs’ pre- and post-shift work claims, Stewart’s short-break claim, Wills’s rounding claim, and Stewart’s NYSHRL and NYCHRL discrimination claims. It granted dismissal of Wills’s short-break claim and the WTPA wage-notice claim. The court directed the parties to appear for a conference on August 9, 2024, and directed the clerk to terminate the motion.