Wang v. Jessy Corporation

Background

Yan Ming Wang sued Jessy Corp., doing business as China Buffet, and Chang Qin Lin, Ngai Fat Mei, and Joyce Zheng. He alleged violations of the Fair Labor Standards Act (FLSA) and the Minnesota Fair Labor Standards Act (MFLSA) based on unpaid overtime. Wang said he worked as a fry cook for about 13 months, worked six days per week, and worked approximately 75 hours per week. He stated that he was paid a flat amount in cash each month rather than overtime pay.

The defendants moved for summary judgment under Rule 56. Summary judgment is appropriate when the evidence shows no genuine dispute about an important fact and the moving party is entitled to judgment as a matter of law. The parties disputed whether Mei Rong Sun remained an opt-in plaintiff, whether the claims were timely, whether Wang was an employee, whether the individual defendants were joint employers, and whether Wang had enough evidence of his overtime hours.

Opt-in Plaintiff

The court held that Sun properly opted into the FLSA action and remained a plaintiff. The court explained that denying conditional certification of a collective action did not remove Sun from the case because conditional certification primarily concerns sending court-approved notice to potential plaintiffs. The court denied the defendants’ motion to the extent it argued that Sun was no longer a proper opt-in plaintiff.

Statute of Limitations

The FLSA and MFLSA generally provide a two-year limitations period, but a three-year period may apply to willful violations. Because Wang filed his claims more than two years but within three years after his employment ended, the limitations issue depended on whether Lin acted willfully.

The court found a genuine dispute of material fact about willfulness. The evidence included Lin’s testimony that he knew about the applicable hour limits, set schedules, supervised workers, knew China Buffet had no overtime policy, and believed the business could not afford overtime. The court therefore denied summary judgment to the extent the defendants relied on the statute of limitations. The court also rejected the argument that Wang gave up his statutory overtime rights by agreeing to a flat monthly payment.

Employment Relationship

The court applied the economic-realities test, which examines whether the practical relationship between the worker and the business is an employment relationship rather than an independent-contractor relationship. The six factors were whether the work was integral to the business, the skill required, the worker’s investment in tools or materials, the business’s control over the work, the worker’s opportunity for profit or loss, and the relationship’s permanence.

The court found that all six factors supported employee status as to China Buffet. Wang’s work as the only fry cook was integral to the restaurant. The job did not require specialized skills, and China Buffet trained him. Wang provided no tools or investment; China Buffet supplied what he needed. China Buffet controlled his transportation, schedule, and supervision. Wang was paid a flat monthly amount and had no meaningful opportunity to increase profits through independent judgment. Although the permanence factor was the closest, the court found that Wang’s work was not limited to a fixed period.

The court therefore held as a matter of law that Wang was an employee of China Buffet and denied summary judgment as to China Buffet.

The court reached a different conclusion for Lin, Zheng, and Mei in their individual capacities. Wang did not allege independent actions by Lin or Zheng outside their responsibilities at China Buffet that would make them joint employers, and he did not allege that Mei was a joint employer. The court granted summary judgment to the individual defendants, finding that they were not Wang’s joint employers and could not be held personally liable for his FLSA or MFLSA claims.

Hours Worked

The court found that Wang met his evidentiary burden at the summary-judgment stage. The defendants had not kept employment records. Lin testified that China Buffet workers, including Wang, worked at least 48 hours per week. Wang also testified that he arrived before lunch service and stayed after closing for cleanup. The court held that this evidence could support a reasonable inference that Wang worked more than 40 hours per week under the FLSA and more than 48 hours per week under the MFLSA.

Because a genuine dispute remained about the exact number of hours Wang worked, the court denied summary judgment on the hours issue.

Disposition

Judge John R. Tunheim granted in part and denied in part the defendants’ motion for summary judgment. The motion was denied as to the statute-of-limitations defense, the sufficiency of Wang’s evidence about hours worked, and China Buffet’s employment relationship with Wang. The motion was granted as to Chang Qin Lin, Joyce Zheng, and Ngai Fat Mei because the court found they were not Wang’s joint employers and could not be held personally liable.