The opinion of the court was delivered by: David G. Larimer United States District Judge
Plaintiffs Tammy Brickey, Becky Norman, Rose Rochow, Sandra Cogswell, Melinda Sappington, and Jennifer Anderson ("plaintiffs") bring this action against defendant Dolgencorp, Inc., ("defendant" or "Dolgencorp") pursuant to the Fair Labor Standards Act, 29 U.S.C. §216(b) ("FLSA"), New York Labor Law §§190 et seq., 652, Ohio Rev. Code Ann. §§4111.01 et seq., 4113.15, Maryland Wage and Hour Laws, Md. Code Ann., Labor & Empl. §§3-401 et seq., 3-501 et seq., and North Carolina Wage and Hour Act, N.C. Gen. Stat. §95-25.1 et seq., for defendant's alleged failure to pay overtime pay to plaintiffs and other Dolgencorp employees who are similarly situated. Plaintiffs claim that during their employment with various Dollar General Stores, Dolgencorp maintained a practice of allocating payroll hours to each store, which resulted in managers' "shaving" off time from time records, and/or requiring employees to perform tasks "offthe-clock."
Pending before the Court are motions by plaintiffs for the conditional certification of an FLSA collective action (Dkt. #104), as well as certification of state law claims classes pursuant to Fed. R. Civ. Proc. 23 (Dkt. #128). Dolgencorp has moved to dismiss the claims of some of the plaintiffs, who failed to appear for depositions (Dkt. #146), strike portions of the evidence submitted by plaintiffs in support of the motion for certification (Dkt. #147), and file a surreply in further opposition to plaintiffs' motion to strike certain declarations (Dkt. #179). Plaintiffs have further moved to file certain exhibits under seal (Dkt. #122), file supplemental declarations in support of the motion to collective action certification (Dkt. #127), and strike declarations filed by Dolgencorp (Dkt. #162). For the reasons that follow, plaintiffs' motions for FLSA collective action certification and certification of state law claims classes under Fed. R. Civ. Proc. 23 are both denied. Dolgencorp's motion to dismiss the claims of plaintiffs who did not appear for depositions (Dkt. #146) is denied, and the remainder of the parties' motions (Dkt. #122, #127, #147, #162, and #179) are denied as moot.
Plaintiffs claim that Dolgencorp maintains a practice of allocating payroll hours to each of its more than 8,000 stores nationwide, limiting the number of hours per week that each store is permitted to have its employees work and record. Plaintiffs allege that each store is required or encouraged to stay within its payroll hours allocation, without employees working overtime, and that if a store manager exceeds her allocated payroll hours or permits her employees to work overtime, she could be subject to reprimand or termination by Dolgencorp. Conversely, managers are purportedly rewarded with increased bonuses where the number of payroll hours worked and recorded by their employees is "under budget." Plaintiffs also allege that managers engage in the practice of "carrying over" overtime hours, recording them as regular work hours for a subsequent week in order to avoid paying compensation at the overtime rate during the week in which they were actually worked, as well as in "shaving off" overtime hours (falsely reducing or omitting them) from employees' time records. Plaintiffs also state that Dolgencorp recently implemented a nationwide scheduling program, which has resulted in employees performing certain tasks "off the clock," and/or working through lunch periods.
I. Plaintiffs' Motion for Conditional Certification of an FLSA Collective Action
Plaintiffs seek conditional certification of an FLSA collective action, to include: All employees who held the job title of 3rd keys, lead store clerks, and assistant store managers while employed by Dolgencorp, Inc., and Dollar General Corporation from February 9, 2003 to [the date the Court grants a motion for notice to class members]. Section 216(b) of Title 29 provides that: an action to recover [unpaid wages] may be maintained against any employer . . . in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought.
The Second Circuit has recognized a district court's authority to order that notice be given to potential members of a plaintiff class in actions under this section (generally referred to as "collective actions"), pursuant to the opt-in provisions of the FLSA. See e.g., Braunstein v. Eastern Photographic Labs, Inc., 600 F.2d 335 (2d Cir. 1978), cert. den., 441 U.S. 944 (1979).
Courts utilize a two-step process when analyzing motions to certify a collective action under the FLSA. First, the court determines whether the proposed class members are "similarly situated." See Mooney v. Aramco Services Co., 54 F.3d 1207, 1213-1213 (5th Cir. 1995). If so, the court conditionally certifies the class and orders putative notice to class members, who are then afforded the opportunity to "opt in." Because a collective action requires written consent from the opt-in plaintiffs, "it lies within the discretion of a district court to begin its involvement early, at the point of the initial notice," in order to ensure that the drafting and distribution of the notice is "timely, accurate and informative." Hoffman-LaRoche Inc. v. Sperling, 493 U.S. 165, 171-172 (1989).
At this early stage,*fn1 the evidentiary standard is lenient, and "courts appear to require nothing more than substantial allegations that the putative class members were together the victims of a single decision, policy or plan . . ." Scholtisek v. The Eldre Corp., 229 F.R.D. 381, 387 (W.D.N.Y. 2005), quoting Mooney, 54 F.3d 1207 at 1213. In so doing, plaintiff must make a "modest factual showing sufficient to demonstrate that [they] and potential plaintiffs together were victims of a common policy or plan that violated the law." Scholtisek, 229 F.R.D. 381 at 387, quoting Hofmann v. Sbarro, Inc., 982 F. Supp. 249, 261 (S.D.N.Y. 1997).
Plaintiffs allege that defendant has a policy and practice of violating the FLSA by maintaining an internal payroll hours allocation policy which gives each store a certain number of work hours, or "labor budget," in which typical functions are expected to be performed, and rewarding managers who are able to stay within their recommended allocation. Plaintiffs contend that although the policy is benign on its face, it has the direct and foreseeable effect of motivating managers to falsely reduce reported work hours for their employees, and/or to assign employees tasks to be performed "off the clock," which results in undercompensation of employees for overtime. Plaintiffs contend that Dolgencorp maintains over 8,000 store locations, all of which are subject to the same policies and procedures and similarly affected by them.
In contrast, Dolgencorp characterizes the plaintiffs' claims as "dissimilar, independent and anecdotal" allegations of time-shaving and working off-the-clock, and argue that plaintiffs have failed to demonstrate a factual nexus between Dollar General's payroll hours allocation policy, and the actions that individual, rogue managers might have taken -- wholly on their own -- in response to the policy. Indeed, plaintiffs do not allege that it was impossible or even difficult for managers to comply with the policy without engaging in illegal activities. A number of the affidavits submitted in support of plaintiffs' motions for certification are by named plaintiffs and putative class members who eventually became managers, all of whom contend that they fulfilled their managerial duties without resorting to FLSA violations. Dolgencorp also offers individual store data which demonstrates that there is no correlation between stores' hours budgets, and the amount of hours ...