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Ines Briceno, Esmeralda Leon, and Francisco Vargas Aguirre v. Usi Services Group

September 28, 2012

INES BRICENO, ESMERALDA LEON, AND FRANCISCO VARGAS AGUIRRE, INDIVIDUALLY AND ON BEHALF OF ALL OTHER PERSON SIMILARLY SITUATED WHO WERE EMPLOYED BY USI SERVICES GROUP, INC., ULTIMATE SERVICES INC., AND FRED GOLDRING AND/OR ANY OTHER ENTITIES AFFILIATED WITH OR CONTROLLED BY USI SERVICES GROUP, INC., ULTIMATE SERVICES INC., AND FRED GOLDRING,
PLAINTIFFS,
v.
USI SERVICES GROUP, INC., ULTIMATE SERVICES INC., AND FRED GOLDRING, AND/OR ANY OTHER ENTITIES AFFILIATED WITH OR CONTROLLED BY USI SERVICES GROUP, INC., ULTIMATE SERVICES INC., AND FRED GOLDRING, DEFENDANTS.



The opinion of the court was delivered by: Seybert, District Judge:

MEMORANDUM &

ORDER

Presently pending before the Court is Ines Briceno, Esmeralda Leon,*fn1 and Francisco Vargas Aguirre's (collectively the "Named Plaintiffs") motion for class certification pursuant to Rule 23 of the Federal Rules of Civil Procedure. For the following reasons, the Named Plaintiffs' motion is DENIED.

BACKGROUND

The Named Plaintiffs commenced this action on October 2, 2009 against USI Services Group, Inc. ("USI"), Ultimate Services Inc. ("Ultimate Services"), and Fred Goldring (collectively, "Defendants"), asserting claims under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 207, for unpaid overtime, under New York Labor Law ("NYLL") § 190 and N.Y. COMP. CODES R. & REGS. tit. 12 §§ 142-2.2, 2.4 for unpaid wages, unpaid overtime, and spread of hours premiums, and under New Jersey Wage and Hour Law ("NJWHL") §§ 34:11-4.2, 34:11-56a4 for unpaid wages and unpaid overtime.

I. Factual Background

A. The Parties

Defendant USI is the parent company of Defendant

Ultimate Services. (Ray Decl. Ex. A, Baranker Dep. Tr. 13.) Ultimate Services is engaged in the business of providing janitorial services to approximately 150 different department and retail stores throughout New York and New Jersey. (Compl. ¶ 20; Baranker Decl. ¶ 2.) Both Ultimate Services and USI are located in New Jersey. (Compl. ¶¶ 10-11.) Defendant Goldring is the owner and Chief Operating Officer of USI. (Ambinder Decl. Ex. A, Baranker Dep. Tr. 17.)

The Named Plaintiffs were all employed by Defendants as janitors in the J.C. Penney store in Massapequa, New York. (Ray Decl. Ex. D, Briceno Dep. Tr. 25; Ambinder Decl. Ex. E, Vargas Aff. ¶ 3; Ambinder Decl. Ex. F, Leon Aff. ¶ 3.) Ms. Briceno worked there from approximately 2002 through 2003 and again from approximately 2006 through 2009. (Ambinder Decl. Ex. D, Briceno Aff. ¶ 3.) Mr. Vargas worked there from approximately 2001 through 2003. (Ambinder Decl. Ex. E, Vargas Aff. ¶ 3.) And Ms. Leon worked there from approximately 2004 through 2006 and again from 2007 through 2009. (Ambinder Decl. Ex. F, Leon Aff. ¶ 3.)

B. Defendants' Timekeeping Policies Each of USI's approximately 150 worksites is run by a store supervisor who is responsible for hiring and training new employees, ordering supplies, and preparing weekly work schedules. (Ray Decl. Ex. A, Baranker Dep. Tr. 22, 91.) Prior to 2006, the store supervisors were also responsible for generating weekly timesheets. (Ray Decl. Ex. B, Golub Dep. Tr. 14.) Each day, employees would manually enter their time on these timesheets,*fn2 which were faxed to USI's headquarters by the store supervisor at the end of the week. (Ray Decl. Ex. B, Golub Dep. Tr. 14.) Employees' time would then be manually entered into Defendants' payroll system. (Ray Decl. Ex. B, Golub Dep. Tr. 14.)

In 2006, Defendants switched to a telephonic timekeeping system using a software program called MITC. (Ray Decl. Ex. B, Golub Dep. Tr. 10.) Under this new system, each employee was assigned a pin number and given a 1-800 number to call at the beginning and end of his or her shift each day. (Ray Decl. Ex. B, Golub Dep. Tr. 41-42.) Upon calling the 1-800 number, employees were directed by an automated recording to enter their pin number, their department number, and the code for their job title. (Ray Decl. Ex. B, Golub Dep. Tr. 42.)

MITC would note the time of the call and transfer that information to Defendants' payroll records. (Ray Decl. Ex. B, Golub Dep. Tr. 10.) Employees were required to call from designated phones at their worksites or their time would not be recorded. (Ray Decl. Ex. B, Golub Dep. Tr. 44-45.) This new system was phased in over a three-to-six month period so that all employees could be properly trained on how to use the MITC software. (Ray Decl. Ex. B, Golub Dep. Tr. 40-41.)

Any errors in an employee's time could be corrected either informally by the employee or his or her supervisor calling headquarters or formally by the employee submitting a "MITC/JCI Phone Problem Call Log" form. (Ray Decl. Ex. B., Golub Dep. Tr. 70-71.) The store supervisors continued using paper timesheets as a backup. (Baranker Decl. ¶ 4.) The MITC software also ran periodic reports to ensure that all employees were logging in and out properly. (Ray Decl. Ex. B, Golub Dep. Tr. 47-49, 56-57.)

The Named Plaintiffs assert, however, that the MITC software was unreliable and often out-of-order, thus making it impossible for employees to log in and out at the times they actually arrived at and left work. (See, e.g., Ambinder Decl. Ex. D., Briceno Aff. ¶¶ 7-8; Ambinder Decl. Ex. F, Leon Aff. ¶¶ 8-9.) They contend that they attempted to report the timekeeping errors to Defendants either directly or through their store supervisor, but that they were rarely, if ever, compensated for that lost time. (See, e.g., Ambinder Decl. Ex. D., Briceno Aff. ¶¶ 9, 12, 14; Ambinder Decl. Ex. E, Vargas Aff. ¶¶ 10, 13, 15; Ambinder Decl. Ex. F, Leon Aff. ¶¶ 9, 12, 14.)

At the same time this new timekeeping policy was implemented, Defendants began automatically deducting meal breaks from employees' scheduled shifts. (Ray Decl. Ex. B., Golub Dep. Tr. 31.) Defendants informed all employees of this new policy before implementing it and eventually began printing the policy on their paychecks. (Ray Decl. Ex. B., Golub Dep. Tr. 46, 80.) The Named Plaintiffs assert, however, that they rarely took their scheduled meal breaks, yet Defendants deducted the time anyway. (See, e.g., Ambinder Decl. Ex. D., Briceno Aff. ¶ 5; Ambinder Decl. Ex. E, Vargas Aff. ¶ 5; Ambinder Decl. Ex. F, Leon Aff. ¶ 5.)

C. "Ghost Employees" in the Massapequa J.C. Penney In or around April 2009, Defendants were notified by J.C. Penney personnel that the store supervisors in the Massapequa store were falsifying time records. (Ray Decl. Ex. A, Baranker Dep. Tr. 49-52; Ray Decl. Ex. G.) The supervisors would not inform Defendants when an employee quit or was fired. Instead, he would hire new employees and/or allow existing employees to work extra shifts using the departed employee's (the "ghost employee") pin number. The supervisors would receive the ghost employee's check and pay his employees in cash. (See Ray Decl. Ex. A, Baranker Dep. Tr. 51-52.)

This affected all three of the Named Plaintiffs. Ms. Briceno worked for Defendants from 2002 through 2003 and again from 2006 through 2009. (Ambinder Decl. Ex. D, Briceno Aff. ¶ 3.) Yet Defendants' records only show that she was employed from 2002 through 2003 (see Baranker Decl. ¶ 6) because from 2006 through 2009 she was told to log in and out using her daughter's pin (Ray Decl. Ex. D, Briceno Dep. Tr. 23-26). Ms. Leon regularly worked two shifts each day: in the morning she would log in and out as herself, but in the afternoon (at her supervisor's direction) she logged in and out using Ms. Briceno's son's pin.*fn3 (Ray Decl. Ex. C, Leon Dep. Tr. 7.) And Defendants have payroll records for Mr. Vargas through 2008 (Ambinder Supp. Decl. Ex. B2) even though he stopped working for Defendants in 2003 (Ambinder Decl. Ex. E, Vargas Aff. ¶ 3; Ambinder Decl. Ex. S, Vargas Dep. Tr. 78-79) because other employees continued to log in and out using his pin number (see Ambinder Decl. Ex. R, Hernandez Vargas Dep. Tr. 74-77, 89 (Mr. Vargas' son testifying that he would log in and out using his father's pin and would receive checks payable to his father); Ambinder Decl. Ex. M, Chicas Aff. ¶¶ 11-12 (employee stating that he was paid in cash by Mr. Vargas)). There is no evidence in the record that this occurred at any of Defendants' other locations.

II. Procedural Background

The Named Plaintiffs commenced this action on behalf

of themselves and all other similarly situated employees of Defendants. They seek damages under the FLSA for unpaid overtime wages, under NYLL for unpaid wages, overtime, and spread of hours premiums, and under NJWHL for unpaid wages and overtime.

In June 2010, the Court certified a collective action under the FLSA consisting of "all of Defendants' service employees who worked at the J.C. Penney in Massapequa, New York, between June 7, 2008 and the present." (Docket Entry 27, at 8.) After additional briefing, in August 2010, the Court expanded the collective action to include "all of Defendants' service employees, regardless of the location where they worked," who were employed from June 6, 2008 through ...


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