United States District Court, S.D. New York
Eric
Robert Stern Sack & Sack, LLP New York, New York Counsel
for Plaintiff
Nirav
Sanjay Shah Cantor Fitzgerald New York, New York Counsel for
Defendants
OPINION & ORDER
VERNON
S. BRODERICK, UNITED STATES DISTRICT JUDGE.
Plaintiff
Karen Aflalo brings this suit pursuant to the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. §
215(a)(3), and New York Labor Law (“NYLL”), N.Y.
Lab. Law § 215, against Defendants Cantor Fitzgerald,
L.P., Cantor Fitzgerald Securities, Inc. (collectively,
“Cantor Fitzgerald”), BGC Partners, Inc.
(“BGC”), GFInet, Inc., and GFI Group, Inc.
(“GFI, ” and together with BGC and Cantor
Fitzgerald, “Defendants”), alleging that
Defendants terminated her employment in retaliation for her
internal complaints with respect to Cantor Fitzgerald's
misclassification of employees as exempt from overtime.
Before
me is Defendants' motion to dismiss Plaintiff's
complaint under Federal Rule of Civil Procedure 12(b)(6).
Because I find that Plaintiff has failed to establish that
she was engaged in “protected activity” for the
purpose of establishing a prima facie claim under the FLSA,
Defendants' motion to dismiss is GRANTED with respect to
Plaintiff's FLSA claim, and this claim is dismissed.
Because I have dismissed Plaintiff's FLSA claim, I
decline to exercise supplemental jurisdiction over
Plaintiff's NYLL claim, and Defendants' motion to
dismiss is also GRANTED with respect to this claim and it is
dismissed without prejudice to filing that claim in state
court.
I.
Background[1]
A.
Plaintiffs Employment at GFI, BGC, and Cantor
Fitzgerald
Plaintiff
started working at GFI in approximately March 2002, and
remained employed there until February 2015 when BGC, an
affiliate of Cantor Fitzgerald, L.P., acquired GFI, and
Plaintiff became either a BGC or Cantor Fitzgerald employee.
(Compl. ¶¶ 22, 26.)[2] At GFI, Plaintiff was a
“well respected, senior human resources employee
responsible for managing, developing, and administering
strategies for employee relations, talent acquisition,
performance management, HR compliance, payroll, compensation,
and benefits supporting all back and front staff in the
Americas region.” (Id. ¶ 27.)
When
Plaintiff started working at either BGC or Cantor Fitzgerald
after the acquisition announcement, she met with senior
personnel in the human resources group, including: (1) Lori
Pennay, Cantor Fitzgerald's Global Head of Human
Resources; (2) Stephen Merkel, Cantor Fitzgerald's
General Counsel; (3) Dan Aiken, a Cantor Fitzgerald
“Vice President, Human Resources Generalist” and
“Human Resources Business Partner who supported
Accounting, Finance, and Operations;” and (4) Patricia
Dreste, another senior-level Cantor Fitzgerald executive.
(See Id. ¶¶ 28-35, 74.) Plaintiff worked
closely with Pennay, who “relied heavily on [Plaintiff]
to serve in a global capacity working with other GFI Human
Resources Directors in the [Europe, Middle East, and Africa
regions] and Asia Regions in order to streamline . . .
countless global headcount reports, global payroll reports,
and information on GFI's global benefits and
policies.” (Id. ¶ 31.) Beginning in March
2015, Plaintiff also began working closely with Aiken to help
“integrate the GFI Accounts Payable, Accounts
Receivable, Accounting, and Middle/Back Office Operations
staff into Cantor's teams and business.”
(Id. ¶ 36.)
B.
Puente Action
On or
about July 6, 2015, Steven Puente, a former Cantor Fitzgerald
employee who worked at the company's helpdesk, filed a
class action suit in the Southern District of New York
against Cantor Fitzgerald, alleging violations of the FLSA
and the NYLL (“Puente Action”). (Id.
¶ 37.) The Puente Action alleged that Cantor Fitzgerald
was systematically misclassifying certain categories of
employees as exempt from overtime and failing to pay these
employees their overtime wages. (See Id.
¶¶ 37-38.) It also alleged that Cantor Fitzgerald
was (1) systematically trying to force misclassified
employees into signing a contract that would give away their
rights to overtime, (2) failing to notify employees of the
FLSA and NYLL overtime provisions, and (3) failing to keep
adequate records. (Id. ¶ 41.)
C.
Plaintiff's Discovery of
Misclassifications
In
connection with Plaintiff's work with Pennay and Aiken,
Plaintiff looked into how GFI and Cantor Fitzgerald
classified employees for the purpose of overtime-i.e., exempt
or non-exempt. (Id. ¶ 39-40, 46-57.) For
example, during a telephone call Pennay asked Plaintiff how
GFI had classified employees working at its helpdesk, and
Plaintiff told her that when she started working at GFI
employees had been “misclassified as exempt employees;
but that, following an FLSA audit that was completed in
conjunction with the guidance of the law firm Epstein, Becker
& Green, ‘Helpdesk' employees were properly
re-classified as non-exempt.” (Id.
¶¶ 39-40.) Separately, in connection with the work
she was doing with Aiken, Plaintiff began
“investigating the manner in which Cantor was
classifying different employees in the Operation/Accounting
department” for Aiken. (Id. ¶ 47.)
After
the Puente Action commenced, Plaintiff helped with reviewing
classes of employees at Cantor Fitzgerald to determine
whether they were being misclassified. (Id. ¶
46.) She found that Cantor Fitzgerald was misclassifying
employees in the Accounts Payable, Accounts Receivable, and
Junior Accountant departments, and as she identified the
erroneous classifications, Plaintiff brought them to the
attention of both Aiken and Pennay. (Id.
¶¶ 48-49.) When she described the
misclassifications to Aiken he was “repeatedly
dismissive, ” and “deflected” telling
Plaintiff that he would raise the issue with Dreste but that
he “did not think that anything would change, as
that's the way they have always been paid.”
(Id. ¶¶ 49-50.)
Plaintiff
also offered solutions to these issues based on her
“vast experience reviewing the employment duties of all
staff at GFI.” (Id. ¶¶ 51-52.) She
told Pennay of her experience “investigat[ing]
GFI's classification of other employee classes” and
informed Pennay that “in order to remediate GFI's
unlawful classification, [she] had worked with GFI's
legal department to hire outside FLSA experts from [a] law
firm . . . to assist with her investigation.”
(Id. ¶ 53.) Plaintiff told Pennay that in
addition to overseeing this audit, she managed an internal
FLSA audit. (Id. ¶ 54.)
Pennay
responded by displaying “her apparent relief that
[Plaintiff] clearly had extensive experience with FLSA legal
and compliance matters.” (Id. ¶ 55.)
Pennay also stated that she would rely on Plaintiff to
conduct investigations to “help determine . . . which
classifications of employees would be exempt and which would
be non-exempt from mandatory overtime.” (Id.
¶ 56.) Pennay told Plaintiff that she “had been
mandated” by Cantor Fitzgerald's CEO to
“clean up the mess right away” and was counting
on Plaintiff to help her do so. (Id. ¶¶
55-56.) Pennay also informed Plaintiff that she was
interviewing law firms to help with the process.
(Id. ¶ 57.)
D.
Cantor ...