Hernandez v. Uzzal Express Pizzeria Inc.

Background

Eduardo Hernandez and the defendants, Uzzal Pizzeria, Inc. and Mohammed Uzzal, submitted a proposed settlement in an action asserting claims under the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL). The parties first submitted an agreement on February 25, 2022, and refiled it on March 23, 2022, after correcting a filing error.

On April 6, 2022, the court rejected that earlier agreement because its general release extended beyond the wage claims at issue. The court directed the parties to submit a revised agreement, which they filed on April 29, 2022.

Court’s Analysis

The court explained that private settlement of FLSA claims with prejudice requires approval by either the district court or the Department of Labor. The court therefore had to determine whether the revised agreement was fair and reasonable. It also separately reviewed the reasonableness of the plaintiff’s attorney-fee allocation.

The court found permissible the revised agreement’s attorney-fee allocation, its exception allowing truthful statements within the non-disparagement provision, and its lack of a confidentiality provision. The court also found the revised general release permissible because it covered only known and unknown claims arising under the FLSA or NYLL that were brought in this action. The release excluded claims for unpaid commissions, bonuses, tips, fringe benefits, accrued deductions, and improper deductions.

Disposition

Judge Engelmayer concluded that the revised agreement was reached through procedurally fair means and was fair and reasonable under the governing standard. The court approved the Revised Agreement and directed the Clerk of Court to close the case.