Son v. HAND Hospitality LLC

Background

The plaintiffs, former employees of the Cho Dang Gol restaurant, alleged violations of the Fair Labor Standards Act (FLSA) and New York Labor Law. They alleged that the defendants failed to pay employees for all hours worked, failed to pay required overtime, retained some employee tips, deducted break time even when employees worked through breaks, manipulated time records, and failed to provide accurate wage statements and notices.

The plaintiffs sought conditional certification of an FLSA collective action under 29 U.S.C. § 216(b). An FLSA collective action allows similarly situated employees to join a wage case by affirmatively filing written consent. The proposed collective covered current and former employees who worked at Cho Dang Gol in various front-of-house and back-of-house positions. The plaintiffs also asked the court to approve proposed notices and to pause the statute of limitations for potential participants from the filing of the certification motion through the notice period.

Conditional Certification

The court applied the first step of the two-step FLSA collective-action process. At this stage, plaintiffs must make a modest factual showing that they and potential participants are similarly situated regarding an issue of law or fact important to their FLSA claims. The court does not decide the ultimate merits, resolve factual disputes, or determine whether the alleged violations actually occurred.

The court held that the plaintiffs met this low preliminary standard. All three named plaintiffs alleged that they were subject to at least some common practices, including not being paid for all hours worked, manipulation of recorded hours, and failure to pay overtime for work exceeding 40 hours per week. The court also found supporting evidence concerning tip retention for front-of-house employees and cash-conversion deductions affecting certain kitchen workers. The fact that two plaintiffs worked as servers and one worked in the kitchen did not defeat certification because the alleged unpaid-hours and overtime practices could apply across job categories.

The court treated declarations from former employees involved in other lawsuits against the defendants as providing some corroboration. It found that declarations from a former server and a former kitchen worker largely supported the alleged common practices, while a former employee's declaration concerning conduct ending in June 2020 had little relevance to the proposed period beginning in 2021. The court also noted that claims concerning New York spread-of-hours pay and wage notices or statements were not considered in deciding whether employees were similarly situated for the FLSA collective.

The court therefore conditionally certified the FLSA collective at the preliminary stage. It warned that the collective could later be narrowed or decertified after discovery if the participating employees were not actually similarly situated.

Notice and Contact Information

The court authorized the plaintiffs to distribute notices by mail, email, and text, and to post a notice at the restaurant, subject to specified wording and typographical changes. The notice period was set at 90 days from issuance. The defendants were ordered to provide names, last-known home addresses, cell phone numbers, and email addresses for members of the conditionally certified collective within 10 days. Plaintiffs' counsel was ordered to revise and distribute the notices, and the workplace notice was to be posted within seven days and remain through the notice period.

Equitable Tolling

The court denied the request to equitably toll the statute of limitations for all potential participants at this time. Equitable tolling is a court-created extension of a filing deadline used in unusual circumstances. The court found that the plaintiffs had not shown extraordinary circumstances, concealment by the defendants, or specific potential participants whose claims were at risk of expiring. The court also found that the delay in ruling was not substantial.

The denial was without prejudice to considering tolling for individual participants later, if the facts show that tolling is justified. The court separately found no undue delay by the plaintiffs in filing their certification motion.

Disposition

Judge Robert W. Lehrburger ordered that the plaintiffs' motion to conditionally certify an FLSA collective action was granted in part and denied in part. Conditional certification, contact-information production, notice distribution, and workplace posting were authorized subject to the stated conditions. The request for equitable tolling was denied at this time without prejudice to further consideration of individual circumstances.