Chen v. Hunan Manor Enterprise, Inc.

Background

Nine plaintiffs sued the defendants under the Fair Labor Standards Act and the New York Labor Law. They alleged that, during their employment at the defendants’ restaurants, they were not paid the required minimum wages, overtime wages, spread-of-hours pay, wage statements, wage notices, or pay stubs. After a bench trial held between February 13 and March 13, 2023, the court found the defendants liable on some claims and issued findings of fact and conclusions of law.

The earlier decision dismissed Yong Kang Liu’s and Jixian[g] Wang’s claims with prejudice because they failed to appear at trial. It also found that the defendants’ restaurants operated as one integrated enterprise, making the defendants jointly and severally liable for the applicable wage claims. The court found liability for certain minimum-wage and overtime violations, rejected spread-of-hours liability in the original decision, found that the plaintiffs lacked standing to recover damages for certain wage-notice and wage-statement violations, and awarded damages to several plaintiffs.

The parties then filed three motions asking the court to reconsider parts of that decision: the plaintiffs’ motion; a motion by Hunan Manor Enterprise, Inc., Hunan Manor LLC, Hunan House Manor Inc., Hunan House Restaurant, Inc., Hunan House Restaurant NY LLC, Hunan House, Inc., Zhida Li, and Jingchao Li; and a motion by A Taste of Mao, Inc. and Zhenqi Xiao. Reconsideration is an extraordinary remedy generally limited to overlooked controlling law or evidence, an intervening change in law, new evidence, clear error, or preventing manifest injustice. It is not a chance to reargue issues already decided.

Rulings on the plaintiffs’ motion

The court granted the plaintiffs’ motion. It reconsidered the prior ruling that Shi Ming Chen, Lianhe Zhou, Wei Min Zhu, and Pingjin Fan could not recover spread-of-hours pay because they earned more than the minimum wage.

The court held that the New York Hospitality Industry Wage Order entitled restaurant workers to spread-of-hours pay regardless of their regular rate of pay. Spread of hours means the time between the beginning and end of a workday, including breaks. An employee receives an additional hour of minimum-wage pay for each day when that period exceeds 10 hours.

Relying on trial testimony that it found credible, the court awarded spread-of-hours pay and an equal amount in liquidated damages to the four plaintiffs. The spread-of-hours amounts were $13,308.60 for Shi Ming Chen, $1,343.22 for Lianhe Zhou, $3,938.21 for Wei Min Zhu, and $6,117.35 for Pingjin Fan, plus applicable interest.

Rulings on the Hunan Manor defendants’ motion

The court granted the Hunan Manor defendants’ motion in part as to their request to amend the damages calculation and denied their other requests.

The court denied their request to reconsider the joint-and-several liability of Hunan Manor Enterprise, Inc., Zhida Li, and Jingchao Li. The court had previously found, based on trial testimony and evidence concerning the restaurants’ operations, that the restaurants functioned as one integrated enterprise. The defendants did not present new arguments, evidence, or case law; they relied on material the court had already considered.

The court partly amended the damages calculations based on two agreed corrections. First, it used the required method of converting monthly salaries to weekly equivalents: multiplying the monthly salary by 12 and dividing by 52, rather than dividing the monthly salary by four. Second, it removed damages for Shi Ming Chen’s agreed break in employment between March 31, 2014, and May 29, 2014.

The court rejected the defendants’ other proposed damages changes because they did not identify overlooked controlling law or data. The court concluded that the trial evidence did not support the defendants’ proposed changes concerning Shi Ming Chen’s salary or workdays, and that the original calculations already accounted for Qifang Chen’s work breaks and Xinlong Liu’s work schedule.

The revised calculations included, among other amounts, overtime pay of $171,646.80 for Shi Ming Chen, $15,510.00 for Lianhe Zhou, $30,782.00 for Wei Min Zhu, and $44,001.18 for Pingjin Fan, with equal liquidated damages and applicable interest. The table also listed amended damages for Baojun Tian, Xinlong Liu, and Qifang Chen.

Rulings on the Taste of Mao defendants’ motion

The court denied the motion filed by A Taste of Mao, Inc. and Zhenqi Xiao. The defendants asked for the collective action to be decertified, but they raised that request for the first time on reconsideration, making it untimely. The court also found the issue moot because every plaintiff recovering in the action was named in the First Amended Complaint.

The defendants also asked the court to reconsider its assessment of the plaintiffs’ testimony, arguing that plaintiffs’ counsel had improperly influenced the testimony through lengthy speaking objections. The court found that the defendants cited no controlling authority supporting reconsideration, and it had already assessed witness credibility based on the entire trial record. It therefore denied that request as well.

Disposition

The court’s final disposition was: the plaintiffs’ motion was granted; the Hunan Manor defendants’ motion was granted in part as to amending the damages calculation and denied as to its other requests; and the Taste of Mao defendants’ motion was denied. Judge George B. Daniels directed the Clerk to enter an amended judgment, with prejudgment interest calculated under the original decision.