Michele Metcalf v. Transperfect Global Inc.

Background

Michele Metcalf and Hannah Lawson brought a proposed class action alleging that TransPerfect violated New York labor law by failing to pay overtime and provide accurate wage statements. The proposed class covered salaried employees who worked in TransPerfect’s New York City office, were paid $1,125 or less per week, and worked overtime between December 31, 2018 and September 2019.

Under the New York rules discussed in the opinion, employees earning at least $1,125 per week could be exempt from overtime requirements. Metcalf and Lawson alleged that a change in the law effective January 1, 2019 made them non-exempt because their salaries remained below that threshold. They alleged that TransPerfect did not notify them of the change, provide the required wage information, or pay them overtime.

TransPerfect later issued retroactive salary increases to some employees and asked them to sign forms acknowledging that they had received all wages due. About 120 employees signed those forms, but the named plaintiffs did not. TransPerfect also introduced a 2019 arbitration agreement, which about 101 proposed class members signed. In 2023, it reissued a nearly identical agreement that disclosed this lawsuit; eleven additional proposed class members signed that version. Neither named plaintiff signed either arbitration agreement.

Class-Certification Recommendation

Magistrate Judge Katherine H. Parker recommended certifying this narrower class: all TransPerfect salaried employees in New York City who were paid $1,125 or less per week during the relevant period and did not sign arbitration agreements. The recommendation also called for the parties to meet and confer about a proposed notice to the class.

Both sides objected. The plaintiffs argued that the class should include employees who signed the 2019 arbitration agreement. TransPerfect argued that class certification was improper because employees worked in different departments and schedules, determining overtime eligibility could require individualized analysis under the Fair Labor Standards Act, some class members signed acknowledgment forms, and individual proof was needed to establish standing for wage-statement claims.

Court’s Analysis

The court declined to consider the plaintiffs’ relation-back argument because they had not presented it to Judge Parker even though they could have done so earlier. The relation-back doctrine can treat an amended complaint as filed when the original complaint was filed if specified notice and mistake requirements are met. The court therefore did not decide that argument.

The court also rejected the plaintiffs’ argument that it could use its authority under Federal Rule of Civil Procedure 23 to invalidate the 2019 arbitration agreements. The agreements expressly gave the arbitrator, rather than a court, exclusive authority to decide disputes about enforceability and arbitrability. The court agreed with Judge Parker that this language removed the power to decide those issues from the court.

The court rejected TransPerfect’s objections. It agreed that common questions supported certification, including whether TransPerfect provided accurate wage statements, whether employees were eligible for overtime under New York law, and what legal significance should be given to the retroactive wage payments. Differences in schedules, departments, job duties, and hours did not defeat certification because individualized damages calculations generally do not prevent common issues from predominating.

The court also held that the Fair Labor Standards Act exemption issue concerned the calculation of damages rather than liability for the New York-law claims. It found that the acknowledgment forms did not create a unique defense against Metcalf or Lawson because neither plaintiff signed one. Finally, it rejected TransPerfect’s argument that individualized proof of standing defeated certification, noting that the plaintiffs had previously alleged a concrete injury connected to the wage-statement violations.

Disposition

Judge Ramos adopted Judge Parker’s Report and Recommendation in its entirety. The court certified the narrower class excluding employees who signed arbitration agreements. The parties were directed to meet and confer about the proposed class notice and submit it for the court’s approval within fourteen days. The Clerk of Court was directed to terminate the class-certification motion, docket entry 215.