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SDNY won’t certify bankers’ class action with only vague claims about “typically” being denied pay for off-the-clock, meal-period work

By Lisa Milam-Perez, J.D.

Personal bankers seeking to bring a class-action wage suit against Wells Fargo and Wachovia Bank (acquired by Wells Fargo in 2008) were unable to show that they were subjected to a common policy of denying overtime pay or that class-wide issues predominated, a federal district court in New York held, rejecting their bid for Rule 23 certification of their New York Labor Law (NYLL) claims (Fernandez v Wells Fargo Bank, NA, August 28, 2013, Castel, P. K). Nor could they make the modest factual showing necessary to conditionally certify an FLSA collective action.

Bankers’ hours. Wells Fargo personal bankers (or “financial specialists,” as they were once called at Wachovia) performed customer service and generated business. In this role, they often had to open and close bank branches on business days. Opening or closing required approximately 30 minutes of work for which they “typically” were not paid. For example, one plaintiff asserted that he arrived 30-45 minutes before opening time on days he had to open the branch; on nights that he had to close, he clocked out at precisely 6 p.m., but remained at least an additional 30 minutes. According to the employees, all the bank’s branches throughout New York and the Northeast used the same unofficial procedure for security protocols at branch closings and openings. Also, the employees had to work “call nights” at least two hours each month, both within the bank and off-site, pursuant to their role in marketing ventures and business generations. These hours, which were spent visiting clients and conducting educational seminars, were generally uncompensated.

The employees also contended that due to the high volume of customer traffic, they had to work during lunch periods, yet the company’s timekeeping software would automatically deduct 30 minutes for meal breaks, meaning they were not paid for the work they performed through the break. Moreover, according to the employees, the bank imposed a so-called “dual edge” policy of limiting overtime while delegating onerous assignments that could not be completed within a 40-hour workweek. Their bonuses and performance evaluations were linked to these “unattainable goals.” They were instructed not to record their overtime hours because management would not approve them.

Contending they were entitled to overtime pay for these off-the-clock hours, the personal bankers filed suit under the NYLL and FLSA. Counsel for the plaintiffs had previously asserted similar claims in a federal district court in Texas but failed in their effort to certify a national collective action. That court concluded that the employees had not come forward with sufficient evidence of a common nationwide policy and that individualized determinations were required to determine the circumstances of each plaintiff’s injuries and damages. Much of the evidence submitted by the parties here was obtained in that unsuccessful action. That evidence fared no better here.

Commonality. According to the employees, Wells Fargo delegated broad discretion to local supervisors, thereby adopting a policy that facilitated acts of discrimination. But, as the Supreme Court has noted, “demonstrating the invalidity of one manager’s use of discretion will do nothing to demonstrate the invalidity of another’s,” the court observed. Had they pointed to a biased procedure or “general policy,” they may have satisfied the commonality requirements of Rule 23(a)(2). But nowhere did they cite a specific, concrete, management directive concerning off-the-c1ock work or any purported requirement not to record hours worked.

And their anecdotal evidence concerning a de facto compensation policy wouldn’t suffice. For example, they provided an email from a branch manager stating, “Please note that when working a Saturday you will flex your time during the week as OT is no longer permissible.” But this directive is not equivalent to requiring the bankers to work without overtime pay or to work off the clock. “Evidence that defendants endeavored to arrange employees’ work schedules to reduce overtime when possible is not, without more, evidence of a policy to require uncompensated overtime,” the court wrote. Even if it were, there was no indication that this document reflected a common New York-wide policy, as opposed to a single branch’s policy concerning Saturday work and flex time in a single month. Thus, the employees could not establish that the personal bankers were subject to a common, New York-wide policy to limit their recorded hours or require off-the-clock work—particularly given the evidence Wells Fargo provided to the contrary in the form of handbook provisions directing that employees must take meal breaks and must record their overtime, among other items. Further undermining their claims, the plaintiffs relied on evidence that predated the proposed class period and had no apparent connection to the New York plaintiffs, such as deposition testimony from a district manager in Texas, or training materials dating back to 2001.

Also problematic: The plaintiffs sought to certify two proposed classes—one class of Wells Fargo bankers and another class of Wachovia bankers—but instead of submitting evidence to support Rule 23(a)(2) commonality for each of the putative classes, they lumped together evidence of Wells Fargo policies with evidence concerning Wachovia. “Plaintiffs have not met their burden by citing to evidence concerning one defendant, and then, generally and in a sweeping manner, attributing the identical practice to a second.” In fact, the employees’ submissions reflected that their pay policies varied in material respects. And their class definitions were inartful, at best.

Qualifying words like “commonly,” “typically,” and “generally” permeated the plaintiffs’ assertions that they were denied pay for off-the-clock hours. “Typically we were not compensated for the time spent performing these duties,” one employee noted, for example, but he made no statement that management issued instructions to that effect. In the court’s view, such phrasing supported a finding that payment varied on a case-by-case, incident-by-incident basis, and was not determined by a single, common New York-wide policy. And, again, Wells Fargo refuted these generalized contentions with records reflecting employees’ early morning clock-ins and late clock-outs consistent with having been paid for the pre-shift work.

Similarly, the evidence presented by employees to support their claims that they worked through meal breaks amounted to time records demonstrating the employer’s auto-deduct practice in action. But those records offered no proof that they worked during lunch breaks, let alone that employees throughout New York and the Northeast region were subjected to a common policy of being denied pay for working through lunch. At most, it may constitute some evidence that individual plaintiffs may not have received full pay for work performed on some lunch breaks, and that they were unable to personally override time entries. As such, it would require individualized analysis of each employee’s circumstances.

Likewise, evidence that the employees worked unpaid “call nights,” including a “store manager pre-season planner” and internet job postings noting that bankers were expected to “reach out to the community,” as well as internal job descriptions, reflected only the employers’ expectations pursuant to the bankers’ business generation role. “It does not automatically follow that policies that required personal bankers to market products and generate new business also deprived them of appropriate compensation.”

All told, the plaintiffs’ could not establish commonality requirements for certification. For similar reasons, they fell short of satisfying Rule 23 typicality requirement as well, the court held.

Predominance. Even if the bankers had come forward with evidence concerning a common policy to deny pay for work done during meal breaks or for time spent opening and closing branches, they would still be required to offer some meaningful approach to ascertaining damages on a class-wide basis in order to satisfy the predominance requirement. But they were unable to do so, particularly in light of “such qualified and vague statements concerning when they were denied overtime pay and when they were not,” the court said. Essentially, the bankers asserted that they sometimes were fully paid and sometimes were not. They offered no theory as to why these variations in compensation arose, though, and no concrete representations as to how often they occurred. Because they proposed no class-wide metric for assessing damages, the employees failed to establish predominance under Rule 23(b)(3).

Collective action unwarranted. The bankers also fell short on making the modest factual showing required, even at this lenient stage, that potential opt-in plaintiffs were victims of a common policy or plan that violated the FLSA. As such, their motion for conditional certification of their collective action under Sec. 216(b) also was denied.