Lucero v. Shaker Contractors, Corp.

Background

Luis Lucero, Joaquin Colin, and Jose Argueta sued Shaker Contractors, Corp., and its principal, Sher Gul, alleging violations of the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL). The defendants failed to appear or respond, so the court entered a default judgment for the plaintiffs. The case was referred to Magistrate Judge Jennifer E. Willis to determine damages. Her report recommended $863,489.32 in damages, plus prejudgment and post-judgment interest and $22,913.20 in attorney fees and costs. The plaintiffs objected to four parts of the report.

Rulings on the objections

The court sustained the plaintiffs’ objection to the overtime-damages method. Because the plaintiffs had already received their regular hourly pay for overtime hours, their damages were limited to the additional amount required to bring those hours to one-and-one-half times their regular hourly rate. The revised overtime awards were $17,592.00 for Lucero, $43,670.59 for Colin, and $76,694.23 for Argueta.

The court also changed Argueta’s spread-of-hours damages. New York law requires an extra hour of pay at the basic minimum wage when an employee’s workday exceeds ten hours. Based on the complaint’s allegations that the defendants employed more than eleven people in 2019, the court used a $15.00 minimum hourly wage rather than the $13.50 rate used in the report. Argueta’s total spread-of-hours damages were set at $6,300.00.

The court awarded damages for bounced checks that represented unpaid wages: $4,000.00 for Lucero, $5,900.00 for Colin, and $4,300.00 for Argueta. The court also rejected the proposed reduction in counsel’s billing rates, finding that the calculation errors were not serious enough to justify reducing the hourly rates. It approved hourly rates of $450.00 for Kenneth Katz, $375.00 for Adam Sackowitz, and $325.00 each for Eliseo Cabrera and Nicola Ciliotta.

Wage-record claims

The report had recommended $10,000.00 for each plaintiff based on alleged violations of NYLL provisions requiring wage notices and wage statements. The court applied the rule that a plaintiff may sue in federal court for a statutory violation only after suffering a concrete injury. Because the plaintiffs alleged no concrete harm caused by the failure to provide wage records, the court dismissed those claims and awarded no damages on them.

Final award and disposition

After reviewing the unchallenged portions of the report for clear error, the court adopted the report with modifications. It ordered a total recovery of $341,509.34, consisting of $137,956.82 in unpaid overtime wages, $6,300.00 in unpaid spread-of-hours wages, $14,200.00 in unpaid wages represented by bounced checks, and $158,456.82 in liquidated damages. The plaintiffs were also awarded prejudgment interest at 9%, accruing from the midpoint dates of their respective employment periods to the date of judgment. If the judgment remained unpaid after 90 days, the plaintiffs would receive an additional 15% penalty. Counsel was awarded $24,595.70 in fees and costs. Judge Lorna G. Schofield directed the Clerk to enter judgment, strike the specified prior order, and terminate the case.