Tanseer Kazi v. PNC, Bank, N.A.

Background

The court had previously certified a class of current or former PNC mortgage loan officers represented by Linda Scheid. The certified claims concerned PNC’s alleged failure to compensate loan officers for rest breaks and claims derived from that theory. The previous order did not certify claims concerning other nonproductive time, such as meetings and training sessions, because the plaintiffs had not shown a classwide way to prove how much time loan officers spent in those activities or whether they were also selling loans during them.

Tanseer Kazi was also a named plaintiff, but the court had determined that he could not serve as a class representative because of his bankruptcy. The opinion states that neither Kazi nor his bankruptcy trustee had participated in the case since that determination.

PNC’s compensation system used incentive pay based largely on loan sales. Scheid argued that, by effectively paying incentive compensation instead of separately paying for nonproductive time, PNC recaptured pay for time spent on rest breaks and training. The asserted claims included alleged violations of California rest-break and wage-payment laws, wage-statement laws, California’s Unfair Competition Law, and a representative claim under the Private Attorneys General Act.

PNC’s Motion to Modify the Class

PNC asked the court to replace the class end date of “through the resolution of this action” with June 30, 2019, and to exclude people required to arbitrate. PNC said it changed its compensation plan beginning July 1, 2019, and began requiring loan officers hired after that date to sign arbitration agreements.

The parties agreed that the class should end on June 30, 2019. The court found that the post-June 30 compensation plan was materially different and that claims challenging it would present different issues. The court also found that Scheid, who did not sign an arbitration agreement and no longer worked for PNC at that time, would not be a typical representative of loan officers hired after June 30, 2019.

The court expressly did not decide whether PNC’s compensation policies complied with California law or whether the arbitration agreements were enforceable. It also declined to decide on these motions whether the class notice must explain why the class period ends on June 30, 2019.

The court concluded that the existing language covering “claims based on alleged failure to pay for rest breaks, and claims derivative of such a theory” also covered Scheid’s theory that PNC’s alleged recapture of rest-break pay supported statutory damages. PNC’s motion to establish a June 30, 2019 end date was GRANTED.

Scheid’s Motion to Expand the Class

Scheid asked the court to add claims based on unpaid training sessions, limited to the period after January 5, 2017, because of a prior class settlement. She argued that PNC had records showing which training modules each employee completed and had listed durations for most training programs. She also argued that the listed durations, the training materials, and testimony could provide reasonable estimates of training time.

PNC responded that Scheid had not provided evidence showing how long loan officers other than Scheid spent in training. PNC also argued that the listed durations were maximum planning times rather than typical or actual completion times, that employees could multitask while training, and that the records did not always distinguish between completing training and testing or waiving out of it.

The court applied the class-action requirement that common issues must predominate over individual issues. It explained that employees may sometimes use reliable representative or statistical evidence when an employer failed to keep required time records. But the evidence must still support a reasonable inference that class members spent roughly similar amounts of time on the relevant work.

PNC’s records showed which training modules loan officers completed and the dates of completion, but PNC did not keep records of the actual time each loan officer spent on a course. PNC’s representative testified that the listed durations were estimated maximum times, and the evidence indicated that actual completion times varied considerably. Scheid offered her own testimony, but no expert report and no testimony from another loan officer about training time. The court found that her evidence did not show that loan officers spent roughly equal amounts of time in training. Scheid’s motion to expand class certification was therefore DENIED.

Sealing Motions and Final Disposition

Scheid filed two administrative motions to file documents under seal. The only stated basis was PNC’s designation of the documents as confidential, and PNC did not file the declaration required by the applicable local rule. Both sealing motions were DENIED. The court ordered Scheid to file the documents in the public record between June 26 and July 2, 2020.

Judge Joseph C. Spero’s order granted PNC’s motion, denied Scheid’s motion, modified the certified class to cover claims through June 30, 2019 based on alleged failure to pay for rest breaks and claims derivative of that theory, and denied the sealing motions. The order did not decide the underlying question whether PNC’s compensation practices violated California law.