Hunton Employment & Labor Perspectives

Andrea Mickles filed a complaint against her employer Country Club Inc., alleging it had violated the Fair Labor Standards Act (FLSA) by improperly classifying her and other employees as independent contractors and failing to pay them minimum wage and overtime.  She filed her case as a collective action, and others opted into the case before any ruling on conditional certification.  Those opt-ins eventually provided the Eleventh Circuit with an opportunity to address an issue of first impression in any Circuit: What is the status of individuals who opt into a case that is never conditionally certified?The FLSA 29 U.S.C. §216(b) allows a plaintiff to file a complaint on behalf of herself and all other similarly situated employees in a collective action suit. Unlike a class action, in which similarly situated individuals are bound by the judgment unless they opt-out, a collective action only binds individuals who affirmatively opt-in. Typically, collective actions follow a two-step process. First, the plaintiff moves for conditional certification, which is not subject to a very high standard and is usually granted.  At that point, notice goes out to other potential class members, who have the opportunity to opt-in. Then, after discovery, the defendant files a motion to decertify the class. At the decertification phase, the court decides whether the original plaintiff and opt-in plaintiffs are similarly situated. If they are not, the opt-ins’ claims are dismissed without prejudice, so that they may later file individual claims.

In the Mickles case, other employees opted in before conditional certification, and the motion to certify the class was ultimately denied for untimeliness. The court was then faced with the question of the opt-ins’ status. Were they parties to the litigation even though there had been no ruling on whether they were similarly situated? If so, any decisions the court made with respect to Mickles would also apply to them. If not, they would have to bring their own individual cases, an option that may have been foreclosed by the statute of limitations.

The Eleventh Circuit addressed this question of first impression and ultimately held—in a published (precedential) opinion—that the opt-in plaintiffs were, in fact, parties to the litigation. This meant they could appeal any of the district court’s decisions with respect to Mickles, including approval of her settlement. The Court found that the purpose of the conditional certification step was merely to disseminate notice of the action and not a necessary step to obtain party plaintiff status. Consequently, opt-in plaintiffs remain party plaintiffs unless the district court determines they are not similarly situated.

Following Mickles, defeating conditional certification will not result in automatic dismissal without prejudice of early opt-ins.  Employers will have to continue to defend against opt-in plaintiffs (or move to sever their claims), even if the opt-ins are not similarly situated to the named plaintiff.