Ramos v. Guaba Deli Grocery Corp.

Background

Edwin Omar Ramos, Rayniel Vargas, and Anthony Cruz sued Guaba Deli Grocery Corp. doing business as Guaba Deli, Jose Castillo, Luis Rivera, and Daisy Guaba under the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL). They alleged minimum-wage, overtime, spread-of-hours, and Wage Theft Prevention Act violations, and sought liquidated damages, prejudgment interest, attorneys’ fees, and costs.

The workers moved for summary judgment, which is a request for judgment without a trial because the relevant facts are not genuinely disputed. Defendants opposed the motion by submitting an attorney’s affirmation and Rivera’s affidavit, but did not submit the statement of facts required by the court’s local rules or a memorandum of law. The court declined to grant the motion automatically based on those filing failures, but reviewed the evidence supporting the workers’ factual statements. It gave no weight to the attorney’s affirmation and gave limited consideration to unsupported or conclusory portions of Rivera’s affidavit.

The opinion states that Ramos worked six days per week from 5:00 p.m. to 4:00 a.m., totaling 66 hours per week, and was paid $650 per week. Vargas worked six days per week from 7:00 a.m. to 5:00 p.m., totaling 60 hours per week, and was paid $550 per week. Cruz worked six days per week on the same schedule as Vargas, totaling 60 hours per week, and was paid $550 per week. Defendants paid the workers in cash on a salary basis, did not keep adequate records of their hours, did not provide paystubs or wage statements, did not provide wage notices at hiring, and did not pay overtime premiums.

Coverage and Employer Status

The court found that Guaba Deli was an enterprise engaged in interstate commerce under the FLSA because it engaged in interstate commerce and had annual revenues exceeding $500,000 in 2018 and 2019. The court also found that the workers were covered employees under the NYLL.

Applying the FLSA’s “economic reality” test, the court held that Luis Rivera and Daisy Guaba were the workers’ employers under both the FLSA and NYLL. Rivera hired and supervised the workers, controlled their schedules, determined how they were paid, and had the power to maintain employment records. Guaba had the power to hire and fire employees, supervise employees, set wages and schedules, and maintain employment records; she also supervised Ramos one day per week.

The court reached the opposite conclusion for Jose Castillo. Although Castillo was the company’s president and co-owner and had authority to hire and fire employees, set schedules, and maintain records, the court found that he did not exercise those powers during the workers’ employment and did not supervise them. His control over the store’s lease and liquor license was not sufficiently connected to the workers’ employment. The court therefore found that Castillo was not an employer under the FLSA or NYLL.

Liability and Damages

The court found that the workers’ claims were timely. It applied the FLSA’s three-year limitations period because defendants’ wage violations were willful, meaning defendants knew or recklessly disregarded whether their conduct violated the law. The NYLL claims were also timely under its six-year limitations period.

For overtime, the court found that defendants admitted the workers worked more than 40 hours per week and were not paid time-and-a-half for those hours. The court rejected the argument that the fixed weekly salaries included overtime because there was no explicit agreement establishing regular and overtime rates. Because defendants did not keep adequate records, the court relied on the workers’ testimony about their work dates, hours, and pay to calculate damages.

The court used the NYLL calculation method for overtime because it produced a higher rate than the FLSA method in this case. It awarded unpaid overtime of $38,658.75 to Ramos, $23,100 to Vargas, and $25,050 to Cruz.

The court also found that Cruz was paid below New York City’s applicable minimum wage during eight weeks in 2020, when the required minimum wage was $15 per hour. It awarded Cruz $400 for that shortfall. Ramos was entitled to spread-of-hours pay because his workday exceeded 10 hours, and the court awarded him $4,824 for that violation.

Defendants also failed to provide the required wage notice at hiring or wage statements with each wage payment. The court awarded each worker $5,000 for the wage-notice violation and $5,000 for the wage-statement violation, for $10,000 per worker.

The court awarded liquidated damages under the NYLL because defendants did not show that they acted in good faith to comply with wage requirements. The liquidated-damages awards were $43,482.75 for Ramos, $23,100 for Vargas, and $25,450 for Cruz. The court did not award duplicative liquidated damages under both the FLSA and NYLL.

The court awarded prejudgment interest at 9 percent per year on the compensatory wage damages, beginning from midpoint dates during each worker’s employment and continuing until judgment. It also awarded post-judgment interest on all money awards, including attorneys’ fees and costs, from entry of judgment until payment.

Disposition

Judge Cott granted the plaintiffs’ motion for summary judgment. The court directed the Clerk to enter judgment against Guaba Deli Grocery Corp. doing business as Guaba Deli, Luis Rivera, and Daisy Guaba, jointly and severally, but not against Jose Castillo, in the following amounts: $96,965.50 for Ramos, $56,200 for Vargas, and $60,900 for Cruz, plus the prejudgment and post-judgment interest described in the opinion.

The court also held that the workers could recover reasonable attorneys’ fees and costs, but did not set a final fee amount in this opinion. It directed the workers to file a separate motion supported by documentation.