Wang v. Shun Lee Palace Restaurant, Inc.
- Vernon Broderick
- 1:17-cv-00840
- U.S. District Court · Southern District of New York
- 13
In Wang v. Shun Lee Palace Restaurant, Judge Broderick denied defendants’ motion to dismiss twelve unionized plaintiffs’ wage claims as preempted.
The ruling affects the twelve unionized plaintiffs—Steven Cheung, Quekyeow Yap, Shude Zhang, Keeyew Foo, Tsun Ming Fong, Terry Wong, Ming Sung Chan, Leung Tack Choi, Fong Yue, Billy Qin, Weijun Zhen, and Monaliza Wong—and the restaurant and individual defendants who sought dismissal.
What happened
Wang v. Shun Lee Palace Restaurant involves twelve unionized plaintiffs’ claims that the restaurant defendants violated the Fair Labor Standards Act and New York Labor Law by failing to pay required minimum wages and overtime. The defendants argued that a union agreement controlled the claims.
The court explained that the federal wage claims would be displaced by the Labor Management Relations Act only if deciding them required interpreting the union agreement. The agreement’s payment terms might be used to calculate the plaintiffs’ regular pay rate, but the court found that merely referring to those terms did not require interpreting them. The court also found that the New York claims were related closely enough to the federal claims to remain in the case.
Judge Vernon S. Broderick denied the defendants’ motion to dismiss the twelve unionized plaintiffs’ claims and directed the clerk to close the motion.
The detailed version
- Wang v. Shun Lee Palace Restaurant, Inc. · No. 1:17-cv-00840
- Vernon Broderick
- July 7, 2023
Background
The twelve unionized plaintiffs are Steven Cheung, Quekyeow Yap, Shude Zhang, Keeyew Foo, Tsun Ming Fong, Terry Wong, Ming Sung Chan, Leung Tack Choi, Fong Yue, Billy Qin, Weijun Zhen, and Monaliza Wong. They asserted claims under the Fair Labor Standards Act (FLSA) for unpaid minimum wages and overtime, as well as related claims under the New York Labor Law.
The defendants were Shun Lee Palace Restaurant, Inc., doing business as Shun Lee Palace; T&W Restaurant, Inc., doing business as Shun Lee West; and John Hwang, Michael Tong, Bin Hu, and William Hwang. They moved under Federal Rule of Civil Procedure 12(b)(6) to dismiss the twelve unionized plaintiffs’ claims, arguing that the claims were preempted by Section 301 of the Labor Management Relations Act (LMRA).
Legal Standard
A Rule 12(b)(6) motion tests whether the complaint states a legally sufficient claim. At this stage, the court accepts well-pleaded factual allegations as true and draws reasonable inferences for the plaintiffs, but it does not accept legal conclusions as facts.
The FLSA and New York Labor Law require employers to pay minimum wages and overtime. The plaintiffs’ statutory wage rights are separate from contractual rights under a collective bargaining agreement (CBA). LMRA preemption applies when deciding a claim requires interpreting the CBA. It does not apply merely because the court must refer to the CBA for information, such as an employee’s rate of pay.
Analysis
The defendants pointed to CBA provisions concerning weekly overtime, daily overtime, holiday premiums, and guaranteed weekly payments. They argued that the court had to interpret those provisions to determine whether the twelve plaintiffs received the correct minimum wages and overtime.
The court rejected that argument. It explained that determining overtime pay may require calculating the plaintiffs’ regular rate of pay and considering payments made under the CBA. But the CBA provisions identified by the defendants appeared straightforward, unambiguous, and undisputed. Referring to those provisions to calculate pay did not require interpreting the agreement.
The court distinguished cases in which a plaintiff disputed whether the CBA entitled the employee to particular compensation. Here, the plaintiffs alleged that they were not paid amounts they were entitled to receive, rather than disputing the CBA’s payment terms. The court therefore concluded that the FLSA minimum-wage and overtime claims were not preempted by the LMRA. It also concluded that the same reasoning applied to the minimum-wage claims because the relevant calculations were governed by the FLSA and its regulations, not by an interpretation of the CBA.
The court noted that if a dispute about the CBA’s meaning arose later, the defendants could file a later dispositive motion based on LMRA preemption. The court also exercised supplemental jurisdiction over the twelve plaintiffs’ New York Labor Law claims because those claims were sufficiently related to the federal wage claims.
Disposition
The court denied the defendants’ motion to dismiss. It directed the clerk to close the open motion at docket entry 224.
Read the full 13-page opinion on CourtListener, the free public archive maintained by the Free Law Project.