Edward Monroe v. FTS USA, LLC

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 16a0054p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
EDWARD MONROE, FABIAN MOORE, and TIMOTHY ┐
WILLIAMS, on behalf of themselves and all others │
similarly situated, │
Plaintiffs-Appellees, │
│
> No. 14-6063
│
v.
│
│
FTS USA, LLC; UNITEK USA, LLC, │
Defendants-Appellants. │
┘
Appeal from the United States District Court
for the Western District of Tennessee at Memphis.
No. 2:08-cv-02100—John Thomas Fowlkes, Jr., District Judge.
Argued: October 6, 2015
Decided and Filed: March 2, 2016
Before: BOGGS, SUTTON, and STRANCH, Circuit Judges.
_________________
COUNSEL
ARGUED: Miguel A. Estrada, GIBSON, DUNN & CRUTCHER LLP, Washington, D.C., for
Appellants. Adam W. Hansen, NICHOLS KASTER, PLLP, Minneapolis, Minnesota, for
Appellees. ON BRIEF: Miguel A. Estrada, GIBSON, DUNN & CRUTCHER LLP,
Washington, D.C., Colin D. Dougherty, Jonathan D. Christman, FOX ROTHSCHILD LLP, Blue
Bell, Pennsylvania, for Appellants. Adam W. Hansen, Rachhana T. Srey, Anna P. Prakash,
NICHOLS KASTER, PLLP, Minneapolis, Minnesota, William B. Ryan, Bryce W. Ashby,
DONATI LAW FIRM, LLP, Memphis, Tennessee, for Appellees. William C. Jhaveri-Weeks,
GOLDSTEIN, BORGEN, DARDARIAN & HO, Oakland, California, for Amicus Curiae.
STRANCH, J., delivered the opinion of the court in which BOGGS, J., joined.
SUTTON, J. (pp. 31-42), delivered a separate opinion concurring in part and dissenting in part.
1
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_________________
OPINION
_________________
STRANCH, Circuit Judge. Edward Monroe, Fabian Moore, and Timothy Williams
brought this Fair Labor Standards Act (FLSA) claim, on behalf of themselves and others
similarly situated, against their employers, FTS USA, LLC and its parent company, UniTek
USA, LLC. FTS is a cable-television business for which the plaintiffs work or worked as cable
technicians. The district court certified the case as an FLSA collective action, allowing 293
other technicians (collectively, the FTS Technicians) to opt in. FTS Technicians allege that FTS
implemented a company-wide time-shaving policy that required its employees to systematically
underreport their overtime hours. A jury returned verdicts in favor of the class, which the district
court upheld before calculating and awarding damages. We AFFIRM the district court’s
certification of the case as a collective action and its finding that sufficient evidence supports the
jury’s verdicts. We REVERSE the district court’s calculation of damages and REMAND the
case for recalculation of damages consistent with this opinion.
I. BACKGROUND
A. Facts
FTS contracts with various cable companies, such as Comcast and Time Warner, to
provide cable installation and support, primarily in Tennessee, Alabama, Mississippi, Florida,
and Arkansas. To offer these services, FTS employs technicians at local field offices, called
“profit centers.” FTS’s company hierarchy includes a company CEO and president, regional
directors, project managers at each profit center, and a group of supervisors. FTS Technicians
report to the supervisors and project managers. FTS’s parent company, UniTek, is in the
business of wireless, telecommunication, cable, and satellite services, and provides human
resources and payroll functions to FTS.
All FTS Technicians share substantially similar job duties and are subject to the same
compensation plan and company-wide timekeeping system. FTS Technicians report to a profit
center at the beginning of each workday, where FTS provides job assignments to individual
14-6063 Monroe, et al. v. FTS USA, et al. Page 3
technicians and specifies two-hour blocks in which to complete certain jobs. Regardless of
location, “the great majority of techs do the same thing day in and day out which is install cable.”
Time is recorded by hand, and FTS project managers transmit technicians’ weekly timesheets to
UniTek’s director of payroll. FTS Technicians are paid pursuant to a piece-rate compensation
plan, meaning each assigned job is worth a set amount of pay, regardless of the amount of time it
takes to complete the job. The record shows that FTS Technicians are paid by applying a .5
multiplier to their regular rate for overtime hours.
FTS Technicians presented evidence that FTS implemented a company-wide time-
shaving policy that required technicians to systematically underreport their overtime hours.
Managers told or encouraged technicians to underreport time or even falsified timesheets
themselves. To underreport overtime hours in compliance with FTS policy, technicians either
began working before their recorded start times, recorded lunch breaks they did not take, or
continued working after their recorded end time.
FTS Technicians also presented documentary evidence and testimony from technicians,
managers, and an executive showing that FTS’s time-shaving policy originated with FTS’s
corporate office. Technicians testified that the time-shaving policy was company-wide, applying
generally to all technicians, though not in an identical manner. At meetings, managers instructed
groups of technicians to underreport their hours, and managers testified that corporate ordered
them to do so. One former manager, Anthony Louden, offered testimony regarding high-level
executive meetings. Louden identified overtime and fuel costs as the two leading items that an
FTS executive felt it “should be able to manage and cut in order to make a bigger profit.”
Louden also stated that FTS executives circulated and reviewed technicians’ timesheets, “go[ing]
into detail on which technician had overtime, and, you know, go[ing] over why this guy had too
much overtime and why he didn’t have overtime.” Technicians testified that they often
complained about being obligated to underreport, and FTS’s human resources director testified
that she received such complaints. No evidence was presented that managers or technicians were
disciplined for underreporting time.
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B. Procedural History
A magistrate judge recommended conditional certification as a FLSA collective action,
which the district court adopted. The district court also authorized notice of the collective action
to be sent to all potential opt-in plaintiffs. The notice defined eligible class members as any
person employed by FTS as a technician at any location across the country in the past three years
to the present who were paid by piece-rate and did not receive overtime compensation for all
hours worked over 40 per week during that period. A total of 293 technicians ultimately opted in
to the collective action.1
The parties originally agreed on a discovery and trial plan, which the trial court adopted
by order. Under the parties’ agreement, discovery would be limited “to a representative sample
of fifty (50) opt-in Plaintiffs,” with FTS Technicians choosing 40 and FTS and UniTek choosing
10. The parties also agreed to approach the district court after discovery regarding “a trial plan
based on representative proof” that “will propose a certain number of Plaintiffs from the pool of
fifty (50) representative sample Plaintiffs that may be called as trial witnesses.”
Following the completion of discovery, the district court denied FTS and UniTek’s
motions to decertify the class and for summary judgment, finding that the class members were
similarly situated at the second stage of certification. In light of the parties’ agreement and the
district court’s resulting order—under which the litigation proceeded—the court held that it
could not “accept Defendants’ contention that the parties’ stipulated agreement to limit discovery
to fifty representative plaintiffs did not also manifest Defendants’ acquiescence to a process by
which the remaining members of the class would not have to produce evidence as a prerequisite
to proceeding to trial on their claims.” (R. 238, PageID 5419.) The district court also denied
FTS and UniTek’s pretrial motion to preclude representative proof at trial because “the class
representatives identified by Plaintiff[s] sufficiently represent the class” and “[t]o deny the use of
representative proof in this case would undermine the purpose of class wide relief, and would
have the effect of decertifying the class.” (R. 308, PageID 6822.)
1
Named plaintiff Monroe was a technician during the class period. After the class period, he was promoted
to a managerial position.
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Accordingly, the collective action proceeded to trial on a representative basis. FTS
Technicians identified by name 38 potential witnesses and called 24 witnesses, 17 of whom were
class-member technicians. FTS and UniTek identified all 50 representative technicians as
potential witnesses, but called only four witnesses—all FTS executives and no technicians.
The district court explained the representative nature of the collective action to the jury,
both before the opening argument and during its instructions, noting that FTS Technicians seek
“to recover overtime wages that they claim [FTS and UniTek] owe them and the other cable
technicians who have joined the case.” (R. 450, PageID 10646–47; R. 463, PageID 12253.) The
jury instructions specified that the named plaintiffs brought their claim on behalf of and
collectively with “approximately three hundred plaintiffs who have worked in more than a dozen
different FTS field offices across the country.” (R. 463, PageID 12264.) The court also set out
how the case would be resolved, instructing that FLSA procedure “allows a small number of
representative employees to file a lawsuit on behalf of themselves and others in the collective
group”; that the technicians who “testified during this trial testified as representatives of the other
plaintiffs who did not testify”; and that “[n]ot all affected employees need testify to prove their
claims” because “non-testifying plaintiffs who performed substantially similar job duties are
deemed to have shown the same thing.” (Id. at 12264–65.) The district court then charged the
jury to determine whether all FTS Technicians “have proven their claims” by considering
whether “the evidence presented by the representative plaintiffs who testified establishes that
they worked unpaid overtime hours and are therefore entitled to overtime compensation.” (Id. at
12265.) If the jury answers in the affirmative, the court explained, “then those plaintiffs that you
did not hear from are also deemed by inference to be entitled to overtime compensation.” (Id. at
12265–66.)
The jury returned verdicts of liability in favor of the class, finding that FTS Technicians
worked in excess of 40 hours weekly without being paid overtime compensation and that FTS
and UniTek knew or should have known and willfully violated the law. The jury determined the
average number of unrecorded hours worked per week by each testifying technician—all of
whom were representative and were called on behalf of themselves and all similarly situated
employees, as authorized by 29 U.S.C. § 216(b) and instructed by the district court. As indicated
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to the parties and the jury, the court used the jury’s factual findings to calculate damages for all
testifying and nontestifying technicians in the opt-in collective action. The trial court ruled that
the formula for calculating uncompensated overtime should use a 1.5 multiplier, apparently
based on the assumption that FTS and UniTek normally used that multiplier.
The district court2 held a post-trial status conference and suggested that a second jury
could be convened to decide the issue of damages. FTS and UniTek opposed a second jury,
arguing that plaintiffs had failed to prove damages and judgment should be entered, “either for
the defense or liability for plaintiffs . . . with zero damages.” After the court rejected this
proposal, FTS and Unitek filed motions for judgment as a matter of law, a new trial, and
decertification, all of which were denied. Finding that FTS Technicians had met their burden on
damages, the court adopted their proposed order, using an “estimated-average” approach to
calculate damages and employing a multiplier of 1.5.
II. ANALYSIS
FTS and UniTek challenge the certification of the case as a collective action pursuant to
29 U.S.C. § 216(b), the sufficiency of the evidence as presented at trial, the jury instruction on
commuting time, and the district court’s calculation of damages. After a review of the legal
framework for collective actions in our circuit, we turn to each of these arguments.
A. Legal Framework
Under the FLSA, an employer generally must compensate an employee “at a rate not less
than one and one-half times the regular rate at which he is employed” for work exceeding forty
hours per week. 29 U.S.C. § 207(a)(1). Labor Department regulations clarify, however, that in a
piece-rate system only “additional half-time pay” is required for overtime hours. 29 C.F.R.
§ 778.111(a).
“Congress passed the FLSA with broad remedial intent” to address “unfair method[s] of
competition in commerce” that cause “labor conditions detrimental to the maintenance of the
2
The Honorable Bernice Donald presided over all pretrial and trial issues before assuming her position on
the Sixth Circuit. The Honorable Jon Phipps McCalla and John Fowlkes presided over all post-trial issues,
including the calculation of damages.
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minimum standard of living necessary for health, efficiency, and general well-being of workers.”
Keller v. Miri Microsystems LLC, 781 F.3d 799, 806 (6th Cir. 2015); 29 U.S.C. § 202(a). The
provisions of the statute are “remedial and humanitarian in purpose,” and “must not be
interpreted or applied in a narrow, grudging manner.” Herman v. Fabri-Centers of Am., Inc.,
308 F.3d 580, 585 (6th Cir. 2002) (quoting Tenn. Coal, Iron & R. Co. v. Muscoda Local No. 123,
321 U.S. 590, 597 (1944), superseded by statute on other grounds, Portal-to-Portal Act of 1947,
29 U.S.C. §§ 251–262).
To effectuate Congress’s remedial purpose, the FLSA authorizes collective actions “by
any one or more employees for and on behalf of himself or themselves and other employees
similarly situated.” 29 U.S.C. § 216(b). To participate in FLSA collective actions, “all plaintiffs
must signal in writing their affirmative consent to participate in the action.” Comer v. Wal-Mart
Stores, Inc., 454 F.3d 544, 546 (6th Cir. 2006). Only “similarly situated” persons may opt in to
such actions. Id. Courts typically bifurcate certification of FLSA collective action cases. At the
notice stage, conditional certification may be given along with judicial authorization to notify
similarly situated employees of the action. Id. Once discovery has concluded, the district
court—with more information on which to base its decision and thus under a more exacting
standard—looks more closely at whether the members of the class are similarly situated. Id. at
547.
In O’Brien v. Ed Donnelly Enterprises, Inc., we clarified the contours of the FLSA
standard for certification. There, employees alleged that their employer violated the FLSA by
requiring employees to work “off the clock,” doing so in several ways—requiring unreported
hours before or after work or by electronically altering their timesheets. 575 F.3d 567, 572–73
(6th Cir. 2009). The district court initially certified the O’Brien case as a collective action. Id. at
573. At the second stage of certification, the court determined that the claims required “an
extensive individualized analysis to determine whether a FLSA violation had occurred” and that
“the alleged violations were not based on a broadly applied, common scheme.” Id. at 583.
Applying a certification standard akin to that for class actions pursuant to Federal Rule of Civil
Procedure 23, the district court decertified the collective action on the basis that individualized
issues predominated. Id. at 584.
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On appeal, we determined that the district court engaged in an overly restrictive
application of the FLSA’s “similarly situated” standard. It “implicitly and improperly applied a
Rule 23-type analysis when it reasoned that the plaintiffs were not similarly situated because
individualized questions predominated,” which “is a more stringent standard than is statutorily
required.” Id. at 584–85. We explained that “[w]hile Congress could have imported the more
stringent criteria for class certification under Fed. R. Civ. P. 23, it has not done so in the FLSA,”
and applying a Rule 23-type predominance standard “undermines the remedial purpose of the
collective action device.” Id. at 584–86. Based on our precedent, then, the FLSA’s “similarly
situated” standard is less demanding than Rule 23’s standard.
O’Brien applied the three non-exhaustive factors that many courts have found relevant to
the FLSA’s similarly situated analysis: (1) the “factual and employment settings of the
individual[] plaintiffs”; (2) “the different defenses to which the plaintiffs may be subject on an
individual basis”; and (3) “the degree of fairness and procedural impact of certifying the action
as a collective action.” Id. at 584 (quoting 7B Wright, Miller & Kane, Federal Practice and
Procedure § 1807 at 487 n.65 (3d ed. 2005)); see Morgan v. Family Dollar Stores, Inc., 551 F.3d
1233, 1261–65 (11th Cir. 2008) (applying factors); Thiessen v. Gen. Elec. Capital Corp., 267
F.3d 1095, 1103 (10th Cir. 2001) (applying factors); Frye v. Baptist Mem’l Hosp., Inc., 495 F.
App’x 669, 672 (6th Cir. 2012) (concluding that district court properly exercised its discretion in
weighing the O’Brien factors and granting certification). Noting that “[s]howing a ‘unified
policy’ of violations is not required,” we held that employees who “suffer from a single, FLSA-
violating policy” or whose “claims [are] unified by common theories of defendants’ statutory
violations, even if the proofs of these theories are inevitably individualized and distinct,” are
similarly situated. O’Brien, 575 F.3d at 584–85; see 2 ABA Section of Labor & Employ’t Law,
The Fair Labor Standards Act 19-151, 19-156 (Ellen C. Kearns ed., 2d ed. 2010) (compiling
cases supporting use of the three factors and noting that “many courts consider whether plaintiffs
have established a common employer policy, practice, or plan allegedly in violation of the
FLSA,” which may “assuage concerns about the plaintiffs’ otherwise varied circumstances”).
Applying this standard, we found the O’Brien plaintiffs similarly situated. We
determined that the district court erred because plaintiffs’ claims were unified, as they
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“articulated two common means by which they were allegedly cheated: forcing employees to
work off the clock and improperly editing time-sheets.” O’Brien, 575 F.3d at 585. However,
due to O’Brien’s peculiar procedural posture (the only viable plaintiff remaining did not allege
that she experienced the unlawful practices), remand for recertification was not appropriate.
Id. at 586. In sum, O’Brien explained the FLSA standard for certification, distinguishing it from
a Rule 23-type predominance standard, and adopted the three-factor test employed by several of
our sister circuits. Id. at 585.
Just as O’Brien clarifies the procedure and requirements for certification of a collective
action, the Supreme Court’s opinion in Anderson v. Mt. Clemens Pottery Co.—originally a Sixth
Circuit case—explains the burden of proof at trial. Using a formula “applicable to all
employees,” the district court there awarded piece-rate employees recovery of some unpaid
overtime compensation under the FLSA. 328 U.S. 680, 685–86 (1946), superseded by statute on
other grounds, Portal-to-Portal Act of 1947. We reversed on appeal, determining that the district
court improperly awarded damages and holding that it was the employees’ burden “to prove by a
preponderance of the evidence that they did not receive the wages to which they were entitled
. . . and to show by evidence rather than conjecture the extent of overtime worked, it being
insufficient for them merely to offer an estimated average of overtime worked.” Id. at 686.
On certiorari, the Supreme Court held that we had imposed an improper standard of proof
that “has the practical effect of impairing many of the benefits” of the FLSA. Id. It reminded us
of the correct liability and damages standard, with a cautionary note: an employee bringing such
a suit has the “burden of proving that he performed work for which he was not properly
compensated. The remedial nature of this statute and the great public policy which it embodies
. . . militate against making that burden an impossible hurdle for the employee.” Id. at 686–87.
We have since acknowledged that instruction. See Moran v. Al Basit LLC, 788 F.3d 201, 205
(6th Cir. 2015). The Supreme Court also explained how an employee can satisfy his burden to
prove both uncompensated work and its amount: “where the employer’s records are inaccurate
or inadequate and the employee cannot offer convincing substitutes . . . an employee has carried
out his burden if he proves that he has in fact performed work for which he was improperly
compensated and if he produces sufficient evidence to show the amount and extent of that work
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as a matter of just and reasonable inference.” Mt. Clemens, 328 U.S. at 687. The employee’s
burden of proof on damages can be relaxed, the Supreme Court explained, because employees
rarely keep work records, which is the employer’s duty under the Act. Id.; see O’Brien, 575 F.3d
at 602; see also 29 U.S.C. § 211(c); 29 C.F.R. § 516.2(a)(7). Once the employees satisfy their
relaxed burden for establishing the extent of uncompensated work, “[t]he burden then shifts to
the employer to come forward with evidence of the precise amount of work performed or with
evidence to negative the reasonableness of the inference to be drawn from the employee’s
evidence.” Mt. Clemens, 328 U.S. at 687–88.
We quoted and applied this standard in Herman v. Palo Group Foster Home, Inc.,
concluding that the employees had met their burden on liability because “credible evidence” had
been presented that they had performed work for which they were improperly compensated. 183
F.3d 468, 473 (6th Cir. 1999). Also recognizing this shifting burden, we held that “Defendants
did not keep the records required by the FLSA, so the district court properly shifted the burden to
Defendants to show that they did not violate the Act.” Id. The end result of this standard is that
if an “employer fails to produce such evidence, the court may then award damages to the
employee, even though the result be only approximate.” Id. at 472 (quoting Mt. Clemens, 328
U.S. at 688). We now apply these standards to the case before us.
B. Certification as a Collective Action
FTS and UniTek appeal the denial of their motion to decertify the collective action. We
review a district court’s certification of a collective action under an “abuse of discretion”
standard. See O’Brien, 575 F.3d at 584. “A court abuses its discretion when it commits a clear
error of judgment, such as applying the incorrect legal standard, misapplying the correct legal
standard, or relying upon clearly erroneous findings of fact.” Auletta v. Ortino (In re Ferro
Corp. Derivative Litig.), 511 F.3d 611, 623 (6th Cir. 2008).
The district court made its final certification determination post-trial. With the benefit of
the entire trial record—including representative testimony from technicians covering the several
regions in which FTS operates—the court found that FTS Technicians were similarly situated
and a collective action was appropriate. FTS and UniTek challenge certification of the case as a
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collective action, arguing that differences among FTS Technicians (differences in location,
supervisors, reasons for submitting false timesheets, and types and amount of uncompensated
time) require an individualized analysis as to every plaintiff to determine whether a particular
violation of the FLSA took place for each.
Turning to review, we may not examine the certification issue using a Rule 23-type
analysis; we must apply the “similarly situated” standard governed by the three-factor test set out
in O’Brien. Two governing principles from our case law serve as guides: plaintiffs do not have
to be “identically situated” to be similarly situated, and the FLSA is a remedial statute that
should be broadly construed. 2 ABA Section of Labor & Employ’t Law, supra, at 19-150, 19-
166 (compiling cases).
1. Factual and Employment Settings
The first factor, the factual and employment settings of the individual FTS Technicians,
considers, “to the extent they are relevant to the case, the plaintiffs’ job duties, geographic
locations, employer supervision, and compensation.” Id. at 19-155. On FTS Technicians’ duties
and locations, the record reveals that all FTS Technicians work in the same position, have the
same job description, and perform the same job duties: regardless of location, “the great
majority of techs do the same thing day in and day out which is install cable.” FTS Technicians
also are subject to the same timekeeping system (recording of time by hand) and compensation
plan (piece rate).
Key here, the record contains ample evidence of a company-wide policy of requiring
technicians to underreport hours that originated with FTS executives. Managers told technicians
that they received instructions to shave time from corporate, that underreporting is “company
policy,” and that they were “chewed out by corporate” for allowing too much time to be
reported. Managers testified that FTS executives directed them to order technicians to
underreport time. FTS executives reinforced their policy during meetings with managers and
technicians at individual profit centers. FTS Technicians testified that they complained of being
required to underreport, often in front of or to corporate representatives, who did nothing.
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Evidence of market pressures suggests that FTS executives had a motive to institute a
company-wide time-shaving policy. According to one manager’s testimony, “[e]very profit
center has . . . a budget,” and to meet that budget “you couldn’t put all of your overtime.” Both
managers and technicians were under the impression that FTS’s profitability depended on
underreporting.
The underreporting policy applied to FTS Technicians regardless of profit center or
supervisor, as technicians employed at multiple profit centers and under multiple managers
reported consistent time-shaving practices across the centers and managers. Namely, FTS
executives told managers that technicians’ time before and after work or during lunch should be
underreported. One manager told his technicians that “an hour lunch break will be deducted
whether [they] take it or not,” while technicians who reported full hours were told to “change
that” and that “[t]his is not how we do it over here, . . . you are just supposed to record your 40
hours a week, take out for your lunch, sign it and turn it in.” If technicians failed to comply with
the policy, managers would directly alter time sheets submitted by employees—one manager
changed a seven to an eight and another used whiteout to change times. Regarding reporting
lunch hours not taken, one manager said “that’s the way it’s got to be, you put it on there or I’ll
put it on there.” Even technicians who never received direct orders from managers to
underreport time knew that FTS required underreporting in order to continue receiving work
assignments and to avoid reprimand or termination.
FTS Technicians identified the methods—the same methods found in O’Brien—by which
FTS and UniTek enforced their time-shaving policy: (1) “requiring plaintiffs to work ‘off the
clock’” before or after scheduled hours or during lunch breaks and (2) “alter[ing] the times that
had previously been entered.” O’Brien, 575 F.3d at 572–73. As in O’Brien, such plaintiffs will
be similarly situated where their claims are “unified by common theories of defendants’ statutory
violations, even if the proofs of these theories are inevitably individualized and distinct.” Id. at
585.
The dissent asserts that FTS Technicians allege “distinct” violations of the FLSA and
“define the company-wide ‘policy’ at such a high level of generality that it encompasses multiple
policies.” (Dis. at 34.) The definition of similarly situated does not descend to such a level of
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granularity. The Supreme Court has warned against such a “narrow, grudging” interpretation of
the FLSA and has instructed courts to remember its “remedial and humanitarian” purpose, as
have our own cases. See Tenn. Coal, Iron & R.R. Co., 321 U.S. at 597; Keller, 781 F.3d at 806;
Herman, 308 F.3d at 585. Many FLSA cases do focus on a single action, such as the donning
and doffing cases that the dissent’s reasoning would suggest is the only situation where
representative proof would work. But neither the statutory language nor the purposes of FLSA
collective actions require a violating policy to be implemented by a singular method. The dissent
cites no Sixth Circuit case that would compel employees to bring a separate collective action (or
worse, separate individual actions) for unreported work required by an employer before clocking
in, and another for work required after clocking out, and another for work required during lunch,
and yet another for the employer’s alteration of its employees’ timesheets. Such a narrow
interpretation snubs the purpose of FLSA collective actions.
The dissent concludes that FTS Technicians’ claims do “not do the trick” because a
“company-wide ‘time-shaving’ policy is lawyer talk for a company-wide policy of violating the
FLSA.” (Dis. at 35.) But FTS Technicians’ claims do not depend on “lawyer talk”; they are
based on abundant evidence in the record of employer mandated work off the clock. That an
employer uses more than one method to implement a company-wide work “off-the-clock” policy
does not prevent employees from being similarly situated for purposes of FLSA protection. This
is not a new concept to our court or to other courts. In accordance with O’Brien, we have
approved damages awards to FLSA classes alleging that employers used multiple means to
undercompensate for overtime. See, e.g., U.S. Dep’t of Labor v. Cole Enters., Inc., 62 F.3d 775,
778 (6th Cir. 1995) (approving damages award where employers required employees to work
uncompensated time both before and after their scheduled shifts and to report only the scheduled
shift hours on their timesheets). Other circuits and district courts have done so as well. See
McLaughlin v. Ho Fat Seto, 850 F.2d 586, 588 (9th Cir. 1988) (affirming damages award where
employees gave varied testimony on the means employer used to underpay overtime); Donovan
v. Simmons Petroleum Corp., 725 F.2d 83, 84 (10th Cir. 1983) (affirming damages award where
employer failed to compensate for overtime both before and after work, at different locations);
Wilks v. Pep Boys, No. 3:02-0837, 2006 WL 2821700, at *5 (M.D. Tenn. Sept. 26, 2006)
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(denying motion to decertify class that alleged employer deprived employees of overtime
compensation by requiring them to work off the clock and shaving hours from payroll records).
Like the plaintiffs in O’Brien, FTS Technicians’ claims are unified by common theories:
that FTS executives implemented a single, company-wide time-shaving policy to force all
technicians—either through direct orders or pressure and regardless of location or supervisor—to
underreport overtime hours worked on their timesheets. See O’Brien, 575 F.3d at 584–85; see
also Brennan v. Gen. Motors Acceptance Corp., 482 F.2d 825, 829 (5th Cir. 1973) (affirming
finding of uncompensated overtime where employees understated overtime because of pressure
brought to bear by immediate supervisors, putting upper management on constructive notice of
potential FLSA violations). Based on the record as to FTS Technicians’ factual and employment
settings, therefore, the district court did not abuse its discretion in finding FTS Technicians
similarly situated.
2. Individualized Defenses
We now turn to the second factor—the different defenses to which the plaintiffs may be
subject on an individual basis. FTS and UniTek argue that they must be allowed to raise separate
defenses by examining each individual plaintiff on the number of unrecorded hours they worked,
but that they were denied that right by the allowance of representative testimony and an
estimated-average approach. Several circuits, including our own, hold that individualized
defenses alone do not warrant decertification where sufficient common issues or job traits
otherwise permit collective litigation. O’Brien, 575 F.3d at 584–85 (holding that employees are
similarly situated if they have “claims . . . unified by common theories of defendants’ statutory
violations, even if the proofs of these theories are inevitably individualized and distinct”);
Morgan, 551 F.3d at 1263; see Thiessen, 267 F.3d at 1104–08.
As noted above, the record includes FTS Technicians’ credible testimonial and
documentary evidence that they performed work for which they were improperly compensated.
In the absence of accurate employer records, both Supreme Court and Sixth Circuit precedent
dictate that the burden then shifts to the employer to “negative the reasonableness of the
inference to be drawn from the employee’s evidence” and, if it fails to do so, the resulting
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damages award need not be perfectly exact or precise. Mt. Clemens, 328 U.S. at 687–88 (“The
employer cannot be heard to complain that the damages lack the exactness and precision of
measurement that would be possible had he kept records in accordance with the requirements of
[the FLSA].”); see Herman, 183 F.3d at 473.
Under this framework, and with the use of representative testimony and an estimated-
average approach, defenses successfully asserted against representative testifying technicians
were properly distributed across the claims of nontestifying technicians. For example, FTS and
UniTek argue that testifying technicians did not work all of the overtime they claimed and
underreported some of their overtime for reasons other than a company-wide policy requiring it.
FTS and UniTek had every opportunity to submit witnesses and evidence supporting this claim.
The jury’s partial acceptance of these defenses, as evidenced by its finding that testifying
technicians worked fewer hours than they claimed, resulted in a lower average for nontestifying
technicians. Thus, FTS Technicians’ representative evidence allowed appropriate consideration
of the individual defenses raised here. The district court, moreover, offered to convene a second
jury and submit the issue of damages to it, but FTS and UniTek declined. See Thiessen, 267 F.3d
at 1104–08 (concluding that district court abused its discretion in decertifying the class because
defendants’ “highly individualized” defenses could be dealt with at the damages stage of trial).
Under our precedent and the trial record, we cannot say that the district court committed a clear
error of judgment in refusing to decertify the collective action on the basis of FTS and UniTek’s
claimed right to examine and raise defenses separately against each of the opt-in plaintiffs.
3. Fairness and Procedural Impact
The third factor, the degree of fairness and the procedural impact of certifying the case,
also supports certification. This case satisfies the policy behind FLSA collective actions and
Congress’s remedial intent by consolidating many small, related claims of employees for which
proceeding individually would be too costly to be practical. See Hoffman-La Roche Inc. v.
Sperling, 493 U.S. 165, 170 (1989) (noting that FLSA collective actions give plaintiffs the
“advantage of lower individual costs to vindicate rights by the pooling of resources”);
Espenscheid v. DirectSat USA, LLC, 705 F.3d 770, 776 (7th Cir. 2013) (“[W]here it is class
treatment or nothing, the district court must carefully explore the possible ways of overcoming
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problems in calculating individual damages.”). Because all FTS Technicians allege a common,
FLSA-violating policy, “[t]he judicial system benefits by efficient resolution in one proceeding
of common issues of law and fact.” Hoffman-La Roche, Inc., 493 U.S. at 170. In view of the
entire record, neither this factor nor the other two suggest that the district court abused its
discretion in finding FTS Technicians similarly situated and maintaining certification.
4. The Seventh Circuit Decision in Espenscheid
Lastly, FTS and UniTek argue that Espenscheid—a Seventh Circuit case affirming the
decertification of a collective action seeking unpaid overtime—compels decertification here.
705 F.3d at 773. Espenscheid, however, is based on Seventh Circuit authority and specifically
acknowledges that it is at odds with Sixth Circuit precedent. Id. at 772 (citing O’Brien, 575 F.3d
at 584). Though recognizing the differences between Rule 23 class actions and FLSA collective
actions—and admitting that Rule 23 procedures are absent from the statutory provisions of the
FLSA—the Seventh Circuit determined that “there isn’t a good reason to have different
standards for the certification of the two different types of action.” Id. This conflicts with our
precedent. Explaining that Congress could have but did not import the Rule 23 predominance
requirement into the FLSA and that doing so would undermine the remedial purpose of FLSA
collective actions, we have refused to equate the FLSA certification standard for collective
actions to the more stringent certification standard for class actions under Rule 23. O’Brien, 575
F.3d at 584, 585–86.
The difference between the Seventh Circuit’s standard for collective actions and our own
is the controlling distinction for the issues before us.3 The facts and posture of Espenscheid,
however, also distinguish it from this case. There, the district court decertified the collective
action before trial, after which the parties settled their claims but appealed the decertification.
Reviewing for abuse of discretion, the Seventh Circuit affirmed the district court. The circuit
opinion noted that the plaintiffs had recognized the possible need for individualized findings of
3
The dissent suggests we must follow Espenscheid because it “involved the same defendant in this case.”
(Dis. at 33.) UniTek, the parent company that provided human resources and payroll functions, was involved in
both cases, but at issue in each case was what the direct employer—here FTS, there DirectSat USA—required
regarding the reporting of overtime.
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liability for a class of 2,341 members—nearly 10 times larger than the group here—but
“truculently” refused to accept a specific plan for litigation or propose an alternative and failed to
specify the other kinds of evidence that they intended to use to supplement the representative
testimony. Espenscheid, 705 F.3d at 775–76; see Thompson v. Bruister & Assocs., Inc., 967
F. Supp. 2d 1204, 1216 (M.D. Tenn. 2013) (holding that Espenscheid cannot “conceivably be
read as an overall indictment of utilizing a collective action as a vehicle to establish liability in
piece-rate cases . . . because the Seventh Circuit was presented with little choice but to hold as it
did, given the lack of cooperation by plaintiffs’ counsel in explaining how they intended to prove
up their case”). The opinion additionally references no evidence similar to that supporting the
time-shaving policy here. And the proposed, but not agreed-upon, representative sample in
Espenscheid constituted only 1.8% of the collective action, and the method of selecting the
sample was unexplained. Espenscheid, 705 F.3d at 774.
Conversely, FTS and UniTek ask us to overturn a case tried to completion. They seek a
determination that the district court abused its discretion in declining to decertify the 293-
member collective action after both parties preliminarily agreed to a representative trial plan,
completed discovery on that basis, and jointly selected the representative members. The jury
here, moreover, heard representative testimony from 5.7% of the class members at trial, FTS and
UniTek had abundant opportunity to provide contradictory testimony, and FTS Technicians also
submitted testimony from managers and supervisors along with documentary proof. Upon
completion of the case presentations by the parties, and following jury instructions regarding
collective actions, the jury returned verdicts in favor of FTS Technicians. In light of these legal,
factual, and procedural differences, Espenscheid is simply not controlling.
To conclude our similarly situated analysis, certification here is supported by our
standard. The factual and employment settings of individual FTS Technicians and the degree of
fairness and the procedural impact of certifying the case favor upholding certification. FTS and
UniTek’s alleged individual defenses do not require decertification because they can be, and
were, adequately presented in a collective forum. On the record before us, the district court was
within its wide discretion to try the claims as a collective action and formulated a trial plan that
appropriately did so. Based on the record evidence of a common theory of violation—namely,
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an FLSA-violating time-shaving policy implemented by corporate—we affirm the district court’s
certification of this case as a collective action.
C. Sufficiency of the Evidence
At the close of FTS Technicians’ case and after the jury verdicts, FTS and UniTek moved
for judgment as a matter of law, challenging the sufficiency of the evidence, particularly the
allowance of representative testimony at trial to prove liability and the use of an estimated-
average approach to calculate damages. The district court denied the motion, which FTS and
UniTek now appeal.
“Our review of the sufficiency of the evidence is by review of a trial judge’s rulings on
motions for directed verdict or [judgment as a matter of law].” Young v. Langley, 793 F.2d 792,
794 (6th Cir. 1986). We review de novo a post-trial decision on a motion for judgment as a
matter of law by applying the same standard used by the district court. Waldo v. Consumers
Energy Co., 726 F.3d 802, 818 (6th Cir. 2013). “Judgment as a matter of law may only be
granted if . . . there is no genuine issue of material fact for the jury, and reasonable minds could
come to but one conclusion in favor of the moving party.” Barnes v. City of Cincinnati, 401 F.3d
729, 736 (6th Cir. 2005). The court must decide whether there was sufficient evidence to
support the jury’s verdict, without weighing the evidence, questioning the credibility of the
witnesses, or substituting the court’s judgment for that of the jury. Waldo, 726 F.3d at 818. We
must view the evidence in the light most favorable to the party against whom the motion is made,
giving that party the benefit of all reasonable inferences. Id.
Pursuant to Mt. Clemens, the evidence as a whole must be sufficient to find that FTS
Technicians performed work for which they were improperly compensated (i.e., liability) and
sufficient to support a just and reasonable inference as to the amount and extent of that work
(i.e., damages). Mt. Clemens, 328 U.S. at 687. “[T]he only issue we must squarely decide is
whether there was legally sufficient evidence—representative, direct, circumstantial, in-person,
by deposition, or otherwise—to produce a reliable and just verdict.” Morgan, 551 F.3d at 1280.
Plaintiffs have the initial burden to make the liability and damages showing at trial; once made,
the burden shifts to defendants to prove the precise amount of work performed or otherwise rebut
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the reasonably inferred damages amount. Id. at 687–88. If defendants fail to carry this burden,
the court may award the reasonably inferred, though perhaps approximate, damages. Id. at 688.
1. Liability
FTS and UniTek challenge the district court’s allowance of representative testimony to
prove liability for nontestifying technicians. We have recognized that “representative testimony
from a subset of plaintiffs [can] be used to facilitate the presentation of proof of FLSA
violations, when such proof would normally be individualized.” O’Brien, 575 F.3d at 585.
Preceding O’Brien, we affirmed an award of back wages for unpaid off-the-clock hours based on
representative testimony in Cole Enterprises, Inc., 62 F.3d at 781. There, the defendant objected
to an award of back wages to nontestifying employees, which was based on representative
testimony at trial, interview statements, and the employment records. Id. We endorsed the
sufficiency of representative testimony, holding that “[t]he testimony of fairly representative
employees may be the basis for an award of back wages to nontestifying employees.” Id.In FLSA cases, the use of representative testimony to establish liability has long been
accepted. In the 1980s, the Tenth Circuit approved the use of representative testimony in a
situation comparable to this case. There, the employer did not pay overtime to employees
working cash-register stations before or after scheduled shift hours in six service stations in two
states. Simmons Petroleum Corp., 725 F.2d at 84. Though only twelve employees testified, the
Tenth Circuit held that representative testimony “was sufficient to establish a pattern of
violations,” explaining that the rule in favor of representative testimony is not limited “to
situations where the employees leave a central location together at the beginning of a work day,
work together during the day, and report back to the central location at the end of the day.” Id. at
86 & n.3.
In another comparable FLSA case, the Eleventh Circuit held that, “[i]f anything, the
Mt. Clemens line of cases affirms the general rule that not all employees have to testify to prove
overtime violations.” Morgan, 551 F.3d at 1279. Although Mt. Clemens’s burden shifting
framework did not apply because the employer kept “thorough payroll records,” representative
testimony could rebut on a collective basis the employer’s allegedly individualized defenses to
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liability. Id. at 1276. To do so, seven plaintiffs testified on behalf of 1,424 plaintiffs, less than
1% of the total number. Id. The Eleventh Circuit found that the employer could not validly
complain about the ratio of testifying plaintiffs where, as here, the trial record contained other
“good old-fashioned direct evidence,” id. at 1277, and the employer opposed the plaintiffs’
introduction of additional testimony while choosing not to present its own, id. at 1277–78. As
for the employer’s argument that its defenses were so individualized that the testifying plaintiffs
could not fairly represent those not testifying, the circuit court held that “[f]or the same reasons
that the court did not err in determining that the Plaintiffs were similarly situated enough to
maintain a collective action, it did not err in determining that the Plaintiffs were similarly
situated enough to testify as representatives of one another.” Id. at 1280. The same is true here.
Our sister circuits overwhelmingly recognize the propriety of using representative
testimony to establish a pattern of violations that include similarly situated employees who did
not testify. See, e.g., Garcia v. Tyson Foods, Inc., 770 F.3d 1300, 1307 (10th Cir. 2014) (quoting
the Ninth Circuit’s Henry v. Lehman Commercial Paper, Inc., 471 F.3d 977, 992 (9th Cir. 2006),
for the proposition that “[t]he class action mechanism would be impotent” without representative
proof and the ability to draw class-wide conclusions based on it); Reich v. S. New England
Telecomms. Corp., 121 F.3d 58, 67 (2d Cir. 1997) (“[I]t is well-established that the Secretary
may present the testimony of a representative sample of employees as part of his proof of the
prima facie case under the FLSA.”); Reich v. Gateway Press, Inc., 13 F.3d 685, 701 (3d Cir.
1994) (“Courts commonly allow representative employees to prove violations with respect to all
employees.”); Brock v. Tony & Susan Alamo Found., 842 F.2d 1018, 1019–20 (8th Cir. 1988)
(“[T]o compensate only those associates who chose or where chosen to testify is inadequate in
light of the finding that other employees were improperly compensated.”); Ho Fat Seto, 850 F.2d
at 589 (holding that, based on representative testimony, “[t]he twenty-three non-testifying
employees established a prima facie case that they had worked unreported hours”); Donovan v.
Bel-Loc Diner, Inc., 780 F.2d 1113, 1116 (4th Cir. 1985) (holding that requirement that
testimony establishing a pattern or practice must refer to all nontestifying employees “would
thwart the purposes of the sort of representational testimony clearly contemplated by Mt.
Clemens”); Donovan v. Burger King Corp., 672 F.2d 221, 224–25 (1st Cir. 1982) (limiting
testimony to six plaintiffs from six restaurant locations owned by defendant “in light of the basic
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similarities between the individual restaurants”); Gen. Motors Acceptance Corp., 482 F.2d at 829(holding that, based on testimony from sixteen representative employees and a report on six
employees that found “employees in this type of job consistently failed to report all the overtime
hours worked,” “the trial court might well have concluded that plaintiff had established a prima
facie case that all thirty-seven employees had worked unreported hours”). In the face of these
consistent precedents, many with fact patterns similar to this case, FTS and UniTek point to no
case categorically disapproving of representative testimony to prove employer liability to those
in the collective action who do not testify.
FTS and UniTek next assert that, even if representative testimony is allowed generally,
testifying technicians here were not representative of nontestifying technicians. The record
suggests otherwise, as we explained above when determining that FTS Technicians were
similarly situated. We found that testifying technicians were geographically spread among
various FTS profit centers and were subject to the same job duties, timekeeping system, and
compensation plan as nontestifying technicians. As Morgan highlights, the collective-action
framework presumes that similarly situated employees are representative of each other and have
the ability to proceed to trial collectively. See Morgan, 551 F.3d at 1280.
The dissent also challenges the representative nature of the technicians’ testimony,
arguing for a blanket requirement of direct correlation because a plaintiff alleging “the company
altered my timesheets” cannot testify on behalf of one alleging that “I underreported my time
because my supervisor directed me to.” (Dis. at 36.) Though the time-shaving policy may have
been enforced as to individual technicians by several methods, we do not define
“representativeness” so specifically—just as we do not take such a narrow view of “similarly
situated.” See O’Brien, 575 F.3d at 585; see also Cole Enters., Inc., 62 F.3d at 778. For the
testifying technicians to be representative of the class as a whole, it is enough that technicians
testified as to each means of enforcement of the common, FLSA-violating policy. See Simmons
Petroleum Corp., 725 F.2d at 86 (deeming testimony from at least one employee in each
category of plaintiffs sufficient to establish a pattern of violations and support an award of
damages to all); see also Sec’y of Labor v. DeSisto, 929 F.2d 789, 793 (1st Cir. 1991) (“Where
the employees fall into several job categories, it seems to us that, at a minimum, the testimony of
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a representative employee from, or a person with first-hand knowledge of, each of the categories
is essential to support a back pay award.”).
Here, the jury heard testimony that managers told technicians to underreport hours before
and after work and during lunch and that, in the absence of direct orders, FTS otherwise exerted
pressure to underreport under threat of reprimand, loss of work assignments, or termination. Or
managers just directly altered the timesheets. The dissent’s conclusion that the proof was not
“remotely representative” (Dis. at 36) neither acknowledges how representative testimony was
presented here nor does it follow from the record evidence. There was ample evidence of
managers implementing off-the-clock work requirements established and enforced through one
corporate policy and ample evidence that the collective group of plaintiffs experienced the same
policy enforced through three means. All FTS Technicians were properly represented by those
testifying.
The collective procedure adopted by the district court, moreover, was based on FTS and
UniTek’s agreement, which was memorialized by court order, to limit discovery “to a
representative sample of fifty (50) opt-in Plaintiffs” and to approach the district court after
discovery regarding “a trial plan based on representative proof” that “will propose a certain
number of Plaintiffs from the pool of fifty (50) representative sample Plaintiffs that may be
called as trial witnesses.” After discovery closed, FTS and UniTek did object to the use of
representative proof at trial. But as we have explained, the district court’s denial of that motion
is not grounds for reversal at this stage.
FTS and UniTek’s remaining arguments on liability are simply reiterations of the claims
that FTS Technicians are not similarly situated and that the testifying technicians are not
representative. FTS and UniTek first complain that the liability verdict form gave the jury an
“all or nothing” choice. But the jury’s choice was whether or not FTS applied a single,
company-wide time-shaving policy to all FTS Technicians that encompassed each means used to
enforce it. The jury found that it did. This accords with precedent recognizing that preventing
similarly situated employees from proceeding collectively based on representative evidence
would render impotent the collective-action framework. See, e.g., Garcia, 770 F.3d at 1307.
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Next FTS and UniTek cite Espenscheid a second time. As to representative testimony,
Espenscheid emphasized that the representative evidence before it could not be sufficient
because it consisted entirely of testimony regarding “the experience of a small, unrepresentative
sample of [workers]” (1.8% of the 2,341 members), which cannot “support an inference about
the work time of thousands of workers.” 705 F.3d at 775. These are not the facts before us.
Testifying technicians here are representative, and the ratio of testifying technicians to
nontestifying technicians—5.7%—is well above the range commonly accepted by courts as
sufficient evidence, especially where other documentary and testimonial evidence is presented.
See, e.g., Morgan, 551 F.3d at 1277 (affirming award to 1,424 employees based on testimony
from seven, or .49%, in addition to other evidence); S. New Eng., 121 F.3d at 67 (affirming
award to nearly 1,500 employees based on testimony from 39, or 2.5%); Burger King Corp., 672
F.2d at 225 (affirming award of back wages to 246 employees based on testimony from six, or
2.4%); see also DeSisto, 929 F.2d at 793 (holding “there is no ratio or formula for determining
the number of employee witnesses required” but testimony of a single employee is not enough).
FTS and UniTek, moreover, had the opportunity to call other technicians but chose not to. See
Morgan, 551 F.3d at 1278 (“Family Dollar cannot validly complain about the number of
testifying plaintiffs when . . . Family Dollar itself had the opportunity to present a great deal
more testimony from Plaintiff store managers, or its own district managers, [but] it chose not
to.”).
In light of the proper use of representative testimony to prove liability, we note the
sufficiency of the evidence presented here. FTS Technicians offered testimony from 17
representative technicians and six managers and supervisors, as well as documentary evidence
including timesheets and payroll records, to prove that FTS implemented a company-wide time-
shaving scheme that required employees to systematically underreport their hours. See id. at
1277 (“The jury’s verdict is well-supported not simply by ‘representative testimony,’ but rather
by a volume of good old-fashioned direct evidence.”); Gen. Motors Acceptance Corp., 482 F.2d
at 829 (holding that trial court could conclude violations as to nontestifying employees based on
evidence that “employees in this type of job consistently failed to report all the overtime hours
worked”). Witnesses attributed the time-shaving policy to corporate, and FTS executives told
managers and technicians to underreport overtime. Technicians complained, but FTS took no
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remedial actions. See Cole Enters., Inc., 62 F.3d at 779 (“[I]t is the responsibility of
management to see that work is not performed if it does not want it to be performed.”). In
response to this evidence and despite agreeing to and participating in the selection of 50
representative technicians and including all 50 on its witness list, FTS and UniTek called only
four corporate executives and no technicians.
Our standard of review dictates that we view the evidence in the light most favorable to
FTS Technicians and give them the benefit of all reasonable inferences. Based on the trial
record and governing precedent, we conclude that the evidence here is sufficient to support the
jury’s verdict that all FTS Technicians, both testifying and nontestifying, performed work for
which they were not compensated.
2. Damages
FTS and UniTek object to the use of an estimated-average approach to calculate damages
for nontestifying technicians. They argue that an estimated-average approach does not allow a
“just and reasonable inference”—the Mt. Clemens standard—on the number of hours worked by
nontestifying technicians because it results in an inaccurate calculation, giving some FTS
Technicians more than they are owed and some less.
We addressed a version of the estimated-average approach in Cole Enterprises, Inc.,
concluding that “[t]he information [pertaining to testifying witnesses] was also used to make
estimates and calculations for similarly situated employees who did not testify. The testimony
of fairly representative employees may be the basis for an award of back wages to nontestifying
employees.” 62 F.3d at 781 (emphasis added). Other circuits and district courts have explicitly
approved of an estimated average. See Donovan v. New Floridian Hotel, Inc., 676 F.2d 468,
472–73, 472 n.7 (11th Cir. 1982) (affirming district court’s determination that “waitresses
normally worked an eight and one-half hour day” based on “the testimony of the compliance
officer and computations based on the payroll records”); Donovan v. Hamm’s Drive Inn, 661
F.2d 316, 318 (5th Cir. 1981) (affirming as “accepted practice” and not “clearly erroneous”
district court’s finding that, “based on the testimony of employees, . . . certain groups of
employees averaged certain numbers of hours per week” and award of “back pay based on those
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admittedly approximate calculations” because reversing would penalize the employees for the
employer’s failure to keep adequate records); Baden-Winterwood v. Life Time Fitness Inc., 729
F. Supp. 2d 965, 997–1001 (S.D. Ohio 2010) (averaging hours per week worked by testifying
plaintiffs and applying it to nontestifying plaintiffs); Cowan v. Treetop Enters., 163 F. Supp. 2d
930, 938–39 (M.D. Tenn. 2001) (“From the testimony of the Plaintiffs’ and the Defendants’
employee records, the Court finds . . . that Plaintiffs worked an average of 89.04 hours per week
and applying Mt. Clemens, this finding is applied to the entire Plaintiff class to determine the
amount of overtime backpay owed for the number of weeks of work stipulated by the parties.”).
Mt. Clemens acknowledges the use of “an estimated average of overtime worked” to
calculate damages for nontestifying employees. 328 U.S. at 686. There, eight employees
brought suit on behalf of approximately 300 others. A special master concluded that productive
work did not regularly commence until the established starting time. Id. at 684. Declining to
adopt the special master’s recommendation, the district court found that the employees were
ready for work 5 to 7 minutes before starting time and presumed that they started immediately.
Id. at 685. To calculate damages, the district court fashioned a formula to derive an estimated
average of overtime worked by all employees, testifying and nontestifying. Id. On direct appeal
to the Sixth Circuit, we deemed the estimated average insufficient. Id. at 686. Though the
Supreme Court ultimately agreed with the special master, it reversed our disapproval of the
estimated average, explaining that we had “imposed upon the employees an improper standard of
proof, a standard that has the practical effect of impairing many of the benefits of the Fair Labor
Standards Act.” Id. at 686, 689.
Disapproving of an estimated-average approach simply due to lack of complete accuracy
would ignore the central tenant of Mt. Clemens—an inaccuracy in damages should not bar
recovery for violations of the FLSA or penalize employees for an employer’s failure to keep
adequate records. See id. at 688 (“The damage is therefore certain. The uncertainty lies only in
the amount of damages arising from the statutory violation by the employer. In such a case ‘it
would be a perversion of fundamental principles of justice to deny all relief to the injured person,
and thereby relieve the wrongdoer from making any amend for his acts.’” (quoting Story
Parchment Co. v. Paterson Parchment Co., 282 U.S. 555, 563 (1931)); see also Hamm’s Drive
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Inn, 661 F.2d at 318 (upholding an estimated-average approach and noting that “[e]vidence used
to calculate wages owed need not be perfectly accurate, since the employee should not be
penalized when the inaccuracy is due to a defendant’s failure to keep adequate records”). Mt.
Clemens effectuates its principles through a burden-shifting framework in which employees are
not punished but employers have the opportunity to make damages more exact and precise by
rebutting the evidence presented by employees. See Mt. Clemens, 328 U.S. at 687–88; see also
Herman, 183 F.3d at 473. FTS and UniTek had the opportunity at trial to present additional
evidence to rebut FTS Technicians’ evidence but failed to do so.
Mt. Clemens’s burden-shifting framework, in conjunction with the estimated-average
approach, functioned here as envisioned. Seventeen technicians working at various locations
testified and were cross-examined as to the number of unrecorded hours they worked, allowing
the jury to infer reasonably the average weekly unpaid hours worked by each. Testifying
technicians were similarly situated to and representative of nontestifying technicians, as specified
by the district court’s instructions to the jury, and thus the average of these weekly averages
applied to nontestifying technicians. The jury found fewer unrecorded hours than testifying
technicians claimed; FTS and UniTek thus partially refuted the inference sought by FTS
Technicians and their defenses were distributed to make the damages more exact and precise, as
the Mt. Clemens framework encourages.
Viewing the evidence in the light most favorable to FTS Technicians, we cannot
conclude that reasonable minds would come to but one conclusion in favor of FTS and UniTek.
Accordingly, the average number of unpaid hours worked by testifying and nontestifying
technicians, based on the jury’s findings and the estimated-average approach, resulted from a just
and reasonable inference supported by sufficient evidence.
D. Jury Instruction on Commuting Time
In another challenge to the jury’s determination of unrecorded hours worked, FTS and
UniTek argue that the district court erred by instructing the jury on commuting time. FTS and
UniTek do not dispute that the district court accurately instructed the jury on when commuting
time requires compensation; they instead argue that, as a matter of law, the instruction should not
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have been given because a reasonable juror could not conclude that compensation for commuting
time was required here.
“This [c]ourt reviews a district court’s choice of jury instructions for abuse of discretion.”
United States v. Ross, 502 F.3d 521, 527 (6th Cir. 2007). A district court does not abuse its
discretion in crafting jury instructions unless the instruction “fails accurately to reflect the law”
or “if the instructions, viewed as a whole, were confusing, misleading, or prejudicial.” Id. We
generally must assume that the jury followed the district court’s instructions. See United States
v. Olano, 507 U.S. 725, 740 (1993); see also United States v. Monus, 128 F.3d 376, 390–91
(6th Cir. 1997) (“[E]ven if there had been insufficient evidence to support a deliberate ignorance
instruction, we must assume that the jury followed the jury charge and did not convict on the
grounds of deliberate ignorance.”). Here, the verdict form does not specify whether the jury
included commuting time in the average numbers of unrecorded hours, and we assume that the
jury followed the district court’s instructions by not including commuting time that does not
require compensation.
E. Calculation of Damages
FTS and UniTek lastly challenge the district court’s calculation of damages. They argue
that the district court (1) took the calculation of damages away from the jury in violation of the
Seventh Amendment and (2) used an improper and inaccurate methodology by failing to
recalculate each technician’s hourly rate and by applying a 1.5 multiplier. These are questions of
law or mixed questions of law and fact that we review de novo. See Harries v. Bell, 417 F.3d
631, 635 (6th Cir. 2005).
We begin with the Seventh Amendment arguments. The dissent claims that the Seventh
Amendment was violated because the trial procedure resulted in “non-representative” proof (Dis.
at 39) and posits a standard requiring a jury in any collective action to “determine the ‘estimated
average’ that each plaintiff should receive” (Id. at 40 (emphasis added)). Such an individual
requirement for each member of a collective action does not comport with the principles of and
precedent on representative proof, and would contradict certification of the case as a collective
action in the first place.
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Here, moreover, the proof was representative and the jury rendered its findings for the
testifying and nontestifying plaintiffs in accordance with the district court’s charge. Finding that
“the evidence presented by the representative plaintiffs who testified establishe[d] that they
worked unpaid overtime hours,” and applying that finding in accordance with the instruction that
“those plaintiffs that you did not hear from [would] also [be] deemed by inference to be entitled
to overtime compensation,” the jury determined that all FTS Technicians had “proven their
claims.” The jury accordingly made the factual findings necessary for the court to complete the
remaining arithmetic of the estimated-average approach. The Seventh Amendment does not
require the jury, instead of the district court, to perform a formulaic or mathematical calculation
of damages. See Wallace v. FedEx Corp., 764 F.3d 571, 591 (6th Cir. 2014) (“[A] court may
render judgment as a matter of law as to some portion of a jury award [without implication of the
Seventh Amendment] if it is compelled by a legal rule or if there can be no genuine issue as to
the correct calculation of damages.”); see also Maliza v. 2011 MAR-OS Fashion, Inc., No. CV-
07-463, 2010 WL 502955, at *1 (E.D.N.Y. Feb 10, 2010) (completing arithmetic on shortfalls, if
any, in wages paid to plaintiff after jury calculated “month-by-month determinations of the hours
worked by, and wages paid to, the plaintiff”). On this record, the Seventh Amendment is not
implicated.
At any rate, FTS and UniTek rejected the district court’s offer to impanel a second jury to
make additional findings and perform the damages calculation. They had cited their
“constitutional rights to a jury” at the end of trial, but at the status conference on damages the
court asked if FTS and UniTek wished to have “a panel come in, select another panel, and
submit the issues of damages.” (R. 444, PageID 10171–72.) Their counsel responded, “No, your
honor. I don’t think that’s allowed . . . for these claims.” (Id. at 10172.) The court went on to
ask, “You would be upset if we did have a jury trial to finish up the damages question?” (Id. at
10173.) Counsel responded, “Well, your Honor, again, it’s our position that that’s not
appropriate.” (Id.) Banking instead on their arguments that the estimated-average approach is
inappropriate and that any calculation of damages would not be supported by sufficient evidence,
counsel maintained that “the only thing, quite frankly, that’s left and that is appropriate is an
entry of judgment . . . either for the defense or liability for plaintiffs and with zero damages.”
(Id.) After the court asked for a “more constructive approach from the defense,” counsel agreed
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to a briefing schedule on the calculation of damages. (Id. at 10181.) Counsel subsequently
qualified that FTS and UniTek were “not waiving . . . or changing their position,” but the
positions referenced were those relied upon at the status conference—the estimated-average-
approach disagreement and sufficiency-of-the-evidence argument. Based on this record, FTS
and UniTek abandoned and waived any right to a jury trial on damages that they may have had.
In regard to FTS and UniTek’s challenge to the district court’s methodology, FLSA
actions for overtime are meant to be compensatory. See, e.g., Nw. Yeast Co. v. Broutin, 133 F.2d
628, 630–31 (6th Cir. 1943) (finding that the FLSA “is premised upon the existence of an
employment contract” and that recovery authorized by 29 U.S.C. § 216(b) “does not constitute a
penalty, but is considered compensation”); 29 U.S.C. § 216(b) (“Any employer who violates [the
FLSA] shall be liable to the employee or employees affected in the amount of their . . . unpaid
overtime compensation . . . .”). To achieve its purpose, the FLSA directs an overtime wage
calculation to include (1) the regular rate, (2) a numerical multiplier of the regular rate, and (3)
the number of overtime hours. See 29 U.S.C. § 207; 29 C.F.R. § 778.107. In a piece-rate
system, “the regular hourly rate of pay is computed by adding together total earnings for the
workweek from piece rates and all other sources” and then dividing “by the number of hours
worked in the week for which such compensation was paid.” 29 C.F.R. § 778.111(a). The
numerical multiplier for overtime hours in a piece-rate system is .5 the regular rate of pay. Id. (A
piece-rate worker is entitled to be paid “a sum equivalent to one-half this regular rate of pay
multiplied by the number of hours worked in excess of 40 in the week. . . . Only additional half-
time pay is required in such cases where the employee has already received straight-time
compensation at piece rates or by supplementary payments for all hours worked.”).
As for the hourly rate, the amount of “straight time” paid in a piece rate system remains
the same regardless of the number of hours required to complete the number of jobs. The fixed
nature of piece rates shows that piece-rate compensation was paid for all hours worked by FTS
Technicians, regardless of whether that time was recorded. It also creates an inverse relationship
between the number of hours worked and the hourly rate: working more hours lowers a
technician’s hourly rate. By not recalculating hourly rates to reflect the actual increased number
of hours FTS Technicians worked each week, the district court used a higher hourly rate than
14-6063 Monroe, et al. v. FTS USA, et al. Page 30
would have been used if no violation had occurred. This approach overcompensated FTS
Technicians and required FTS and UniTek to pay more for unrecorded overtime hours than
recorded overtime hours. For the damages calculation to be compensatory, therefore, hourly
rates must be recalculated with the correct number of hours to ensure that FTS Technicians
receive the pay they would have received had there been no violation.
Regarding the correct multiplier, the FLSA entitles piece-rate workers to an overtime
multiplier of .5, and the record shows that FTS and UniTek used this multiplier to calculate FTS
Technicians’ overtime pay for recorded hours. In explaining the piece-rate system to their
technicians, FTS and UniTek provided an example where a technician receiving $1,000 in piece
rates for 50 hours of work would receive $100 in overtime compensation. Reverse engineering
this outcome gives us the following formula: regular rate of $20.00/hour multiplied by a .5
multiplier and 10 overtime hours. Plugging a multiplier of 1.5 into the formula would result in
$300 of overtime pay, overcompensating this hypothetical technician, as it did FTS Technicians.
We accordingly reverse the district court’s use of a 1.5 multiplier.
Reversal of the district court’s calculation of damages does not necessitate a new trial on
liability. We have “the authority to limit the issues upon remand to the [d]istrict [c]ourt for a
new trial” and such action does “not violate the Seventh Amendment.” Thompson v. Camp, 167
F.2d 733, 734 (6th Cir. 1948) (per curiam). We remand to the district court to recalculate
damages consistent with this opinion.
III. CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s certification of this case as a
collective action, allowance of representative testimony at trial, and use of an estimated-average
approach; REVERSE the district court’s calculation of damages; and REMAND to the district
court for recalculation of damages consistent with this opinion.
14-6063 Monroe, et al. v. FTS USA, et al. Page 31
__________________________________________________
CONCURRING IN PART AND DISSENTING IN PART
__________________________________________________
SUTTON, Circuit Judge, concurring in part and dissenting in part. Two questions loom
over every multi-plaintiff action: Who is representing whom? And can they fairly represent
them? Whether it be a class action under Civil Rule 23, a joined action under Civil Rule 20, or
as here a collective action under § 216 of the Fair Labor Standards Act, 29 U.S.C. § 216(b), the
only way in which representative proof of liability—evidence by some claimants to prove
liability for all—makes any sense is if the theory of liability of the testifying plaintiffs mirrors (or
is at least substantially similar to) the theory of liability of the non-testifying plaintiffs. The
same imperative exists at the damages stage, where the trial court must match any representative
evidence with a representative theory of liability and damages.
The three trial judges who handled this case (collectively as it were) did not heed these
requirements. Before trial, the district court mistakenly certified this case as one collective
action as opposed to a collective action with two or three sub-classes, as the various and
conflicting theories of liability required. At trial, the district court approved a method of
assessing damages that violated the Seventh Amendment. After trial, the district court
miscalculated damages by failing to adjust plaintiffs’ hourly wages and using an incorrect
multiplier. The majority goes part of the way to correcting these problems by reversing the
district court’s damages calculation. I would go all of the way and correct the first two errors as
well.
Collective-action certification. The Fair Labor Standards Act permits employees to bring
lawsuits on behalf of “themselves and other employees similarly situated.” 29 U.S.C. § 216(b).
To determine whether plaintiffs are “similarly situated,” we look to (1) “the factual and
employment settings of the individual[] plaintiffs,” (2) “the different defenses to which the
plaintiffs may be subject,” and (3) “the degree of fairness and procedural impact of certifying the
action as a collective action,” among other considerations. O’Brien v. Ed Donnelly Enters.,
575 F.3d 567, 584 (6th Cir. 2009) (quotation omitted), abrogated on other grounds by Campbell-
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Ewald Co. v. Gomez, 136 S. Ct. 663 (2016). Helpful as this checklist may be, it should not
obscure the core inquiry: Are plaintiffs similarly situated such that their claims of liability and
damages can be tried on a class-wide and representative basis? 7B Charles Alan Wright et al.,
Federal Practice and Procedure § 1807 (3d ed. 2005).
That is where the plaintiffs come up short. They claim that the defendants violated the
Fair Labor Standards Act in three distinct ways: (1) by falsifying employees’ timesheets; (2) by
instructing employees to underreport their hours; and (3) by creating incentives for employees to
underreport by rewarding “productiv[ity]” and scheduling fewer shifts for those who worked too
many hours. R. 200 at 8. The problem with the plaintiffs’ approach is that a jury could accept
some of their theories of liability while rejecting others, and yet the verdict form gave the jury
only an all-or-nothing-at-all option. Assume that, as plaintiffs allege, supervisors at a certain
subset of the defendants’ offices directed employees to underreport (which violates the FLSA),
while supervisors at a distinct subset of offices merely urged employees to be more efficient
(which normally will not violate the FLSA). See Davis v. Food Lion, 792 F.2d 1274, 1275–78
(4th Cir. 1986); Brumbelow v. Quality Mills, Inc., 462 F.2d 1324, 1327 (5th Cir. 1972). A jury
could decide that statutory violations occurred at the first group of offices but not the second
(perhaps because the calls for efficiency did not rise to the level of a statutory violation, perhaps
because the plaintiffs did not present enough evidence to conclude that supervisors pressured
their employees to underreport, or perhaps because the only pressure—to be efficient—was self-
induced and not a violation at all). What, then, is the jury tasked with delivering a class-wide
verdict to do? It must say either that the defendants are liable as to the entire class or that the
defendants are liable as to no one—when the truth lies somewhere in the middle. Just as it
would be unfair to impose class-wide liability for all 296 employees based on the
“representative” testimony that some supervisors directed employees not to report their hours, so
it would be unfair to deny class-wide liability based on the “representative” testimony that some
supervisors merely urged employees to be more efficient.
The evidence introduced at trial illustrates the problem. Start with Richard Hunt, who
said he was instructed “to dock an hour for lunch whether [he] took it or not.” R. 456 at 125.
Compare him to Paul Crossan, who testified that he underreported his time “because [he] wanted
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more jobs for more money for [him]self,” thinking he would not be scheduled for extra shifts if
he recorded too many hours. R. 448 at 77. Then compare them both to Stephen Fischer, who
said he was instructed to underreport his hours on some occasions, was told to overreport his
hours on other occasions, and in still other cases underreported because he wanted to “be routed
daily and not miss any work.” R. 456 at 78. With so many variables in play—different
employees offering different testimony about different types of violations—how could a jury
fairly assess liability on a class-wide, one-size-fits-all basis? I for one do not see how it could be
done.
The Seventh Circuit recently explained how all of this should work in its unanimous
opinion in Espenscheid v. DirectSat USA, LLC, 705 F.3d 770 (2013). The case not only arose in
the same industry and not only concerned the same worker-incentive plans, but it also involved
the same defendant in this case. Id. at 772–73. Now that is an apt use of the term similarly
situated. In denying certification, Judge Posner explained the “complication presented by a
worker who underreported his time, but did so . . . not under pressure by [the defendant] but
because he wanted to impress the company with his efficiency.” Id. at 774. The problem, as in
this case, was that some plaintiffs were instructed to underreport; others underreported to meet
the company’s efficiency goals; and still others alleged that, while they recorded their time
correctly, the company miscalculated their wages. Id. at 773–74; see Espenscheid v. DirectSat
USA, LLC, No. 09-cv-625-bbc, 2011 WL 2009967, at *2 (W.D. Wis. May 23, 2011), amended
by 2011 WL 2132975 (W.D. Wis. May 27, 2011). Because the plaintiffs offered no way to
“distinguish . . . benign underreporting from unlawful conduct by [the defendant]”—and no other
way to prove their multiple, conflicting theories of liability on an all-or-nothing class-wide
basis—the Seventh Circuit refused to let them proceed collectively. 705 F.3d at 774. The court
also worried that, because each employee did not perform the same tasks, they were not
sufficiently similar to permit a class-wide determination of liability or damages, id. at 773; that
assessing damages would require a “separate evidentiary hearing[]” for each member of the
class, id.; that the plaintiffs’ plan to use “representative” proof with their hand-picked employees
would not work because the various theories of liability made it impossible to have
representative employees in a single class, id. at 774; and that “the experience of a small,
unrepresentative sample” of testifying workers could not support “an inference about the work
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time of” the remaining plaintiffs, id. at 775. Although the district court had proposed to divide
the employees into three sub-classes, “corresponding to the three types of violation[s]” alleged,
plaintiffs’ counsel opposed the court’s plan and “refus[ed] to suggest a feasible alternative,
including a feasible method of determining damages.” Id. at 775–76. We could adopt the
Seventh Circuit’s opinion as our own in this case, since it highlights precisely the same problems
that afflicted the plaintiffs’ trial plan. Because the employees did not offer a “feasible method of
determining” liability and damages, the district court should have decertified their case. Id. at
776.
All of this does not mean that a collective action was not an option. It means only that
plaintiffs should have accounted for their distinct theories by dividing themselves into sub-
classes, one corresponding to each theory of liability under the statute—and indeed under their
own trial plan. That is a tried and true method of collective-action representation, and nothing
prevented plaintiffs from using it here.
The plaintiffs offer two reasons for concluding that their trial plan worked, even without
sub-classes. First, they argue that they were subject to a “unified” company-wide “time-shaving
policy” and that their trial plan enabled them to prove this policy’s existence on a class-wide
basis. Appellees’ Br. 41. But what was the relevant policy? Was it that supervisors should alter
employees’ timesheets? That they should instruct employees to underreport their hours? That
they should subtly encourage employees to underreport by urging them to be efficient? The
plaintiffs define the company-wide “policy” at such a high level of generality that it encompasses
multiple policies, each one corresponding to a different type of statutory violation and some to no
violation at all. The FLSA does not bar “benign underreporting” where workers try “to impress
the company with [their] efficiency in the hope of obtaining a promotion or maybe a better job
elsewhere—or just to avoid being laid off.” Espenscheid, 705 F.3d at 774. Nor does it violate
the FLSA to reduce an employee’s amount of work to avoid increasing overtime costs.
See 29 C.F.R. § 785.13; see also U.S. Dep’t of Labor v. Cole Enters., Inc., 62 F.3d 775, 779–80
(6th Cir. 1995); Kellar v. Summit Seating Inc., 664 F.3d 169, 177 (7th Cir. 2011). Yet what
purports to link the plaintiffs’ claims (cognizable and non-cognizable alike) is merely the
theory—at a dizzying level of generality—that the defendants violated the overtime provisions of
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the FLSA. A company-wide “time-shaving” policy is lawyer talk for a company-wide policy of
violating the FLSA. That does not do the trick. And most assuredly it does not do the trick
when one of the theories does not even violate the FLSA.
The majority worries that, by requiring sub-classes to litigate the relevant policies, my
approach would limit liability to donning and doffing cases. But those are not the only types of
cases in which a company-wide policy—in the singular—permits class-wide resolution of
liability and damages. Imagine that FTS and UniTek, rather than employing different practices
in different offices, told supervisors at every location to dock the pay of employees who worked
at least fifty hours; or declined to pay employees for compensable commuting time; or stated that
technicians in each office should not be paid for their lunch break, even if they worked through
it; or used punch-in clocks that systematically under-recorded employees’ time. The plaintiffs in
each of these cases could prove liability and damages on a class-wide basis, which means they
could use the collective-action device to litigate their claims. But if, as here, the company
employs multiple policies, as FTS and UniTek allegedly did, the plaintiffs must bring separate
actions or prove violations using sub-classes (or any other trial plan that permits class-wide
adjudication). The majority warns that my approach “would compel employees to bring a
separate collective action . . . for unreported work required by an employer before clocking in,
and another for work required after clocking out.” Supra at 13. But of course that “level of
granularity,” id. at 12–13, is not required, and crying wolf won’t make it so. All that’s required
is an approach that allows plaintiffs to litigate their claims collectively only when they can prove
their claims collectively.
Second, the plaintiffs argue that the jury could assess class-wide liability by relying on
“representative” proof. They note that, before trial, the parties agreed to take discovery on a
“sample” of fifty employees—forty chosen by the plaintiffs, ten by the defendants. R. 249-1
at 2. The plaintiffs called seventeen of those employees to testify at trial. This representative
testimony, say the plaintiffs, gave the jury enough information to reach a class-wide verdict,
which means the employees were sufficiently similar to permit collective-action certification and
collective-action resolution.
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That representative proof works in some cases does not mean it works in all cases. The
question—always—is who can fairly represent whom. If the proof shows systematic
underreporting by the employer of, say, the time it takes to don and doff the same protective
clothing—giving the same workers credit for three minutes when the proof shows it takes seven
minutes—representative proof works just fine. In that setting, there is evidence about how long
it takes workers to don and doff and proof that the same deficiency was applied to all plaintiffs.
But I am skeptical, indeed hard pressed to believe, that plaintiffs who allege one theory of
liability (e.g., the company altered my timesheets) can testify on behalf of those who allege
another (e.g., I underreported my time because my supervisor directed me to) or still another
(e.g., I altered my time because the company urged me to be efficient). Plaintiffs who were told
to underreport, for example, tell us very little about plaintiffs at different offices, working under
different supervisors, who underreported based on efforts to improve efficiency. That is why the
majority goes astray when it suggests that “it is enough that technicians testified as to each
means of enforcement of the common, FLSA-violating policy.” Supra at 21. The question is not
whether each “means of enforcement” was represented; it is whether each means of enforcement
was represented in proportion to its actual employment by FTS and UniTek across the entire
class—something that the plaintiffs did not even attempt to prove.
Does anyone doubt how this case would come out if the roles were reversed—if most of
the testifying plaintiffs were subtly pressured to underreport while only a few were told to do so?
We would hesitate, I suspect, to say that the testifying employees were “representative” of all
their non-testifying peers, especially if the jury returned a verdict for the defendants. What is
sauce for one, however, presumably should be sauce for the other, making the district court’s
certification order perilous for defendants and plaintiffs alike. No doubt, collective actions
permit plaintiffs to rely on representative proof. But that proof must be representative—and here
plaintiffs’ own evidence demonstrates that it was not remotely representative. See Espenscheid,
705 F.3d at 774; see also Sec’y of Labor v. DeSisto, 929 F.2d 789, 793–94 (1st Cir. 1991); Reich
v. S. Md. Hosp., Inc., 43 F.3d 949, 952 (4th Cir. 1995).
The plaintiffs claim that Anderson v. Mt. Clemens Pottery Co. permits this trial plan. 328
U.S. 680 (1946). But by its own terms, that is a case about damages, not liability. Mt. Clemens
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Pottery holds that, after an employee has shown that he “performed work and has not been paid
in accordance with the” FLSA, he may “show the amount and extent of that work as a matter of
just and reasonable inference.” Id. at 687–88. The “just and reasonable inference” rule, in other
words, comes into play only when the “fact of damages” is “certain” but the “amount of
damages” is unclear. Id. at 688. As O’Brien explains, “Mt. Clemens Pottery and its progeny do
not lessen the standard of proof for showing that a FLSA violation occurred.” 575 F.3d at 602;
see also Shultz v. Tarheel Coals, Inc., 417 F.2d 583, 584 (6th Cir. 1969) (per curiam); Porter v.
Leventhal, 160 F.2d 52, 58 (2d Cir. 1946); Kemmerer v. ICI Ams. Inc., 70 F.3d 281, 290 (3d Cir.
1995); Brown v. Family Dollar Stores of Ind., LP, 534 F.3d 593, 594–95 (7th Cir. 2008);
Carmody v. Kansas City Bd. of Police Comm’rs, 713 F.3d 401, 406 (8th Cir. 2013); Alvarez v.
IPB, Inc., 339 F.3d 894, 914–15 (9th Cir. 2003). The case thus provides no support for the
plaintiffs’ claim that they can show liability under a “relaxed” standard of proof. Appellees’ Br.
39.
The plaintiffs counter that the defendants agreed to representative discovery, claiming
that this means they necessarily agreed to representative proof at trial. The one does not follow
from the other. The only way to determine whether one group of plaintiffs is representative of
another is to gather information about both groups, typically by conducting discovery. When the
defendants, after taking depositions, learned that the selected employees were not representative
of their peers, they objected to the plaintiffs’ plan to use representative proof at trial. Then they
objected to it three more times. We have no right to penalize them for failing to raise this
objection before discovery when the targeted problem did not materialize until after discovery
was complete. Put another way, there is a difference between alleging a uniform policy of
underreporting and proving one. Once discovery showed there was no uniform policy, the
defendants properly objected to representative proof.
The plaintiffs lean on O’Brien v. Ed Donnelly Enterprises to try to sidestep these
problems but it cannot bear the weight. 575 F.3d 567 (6th Cir. 2009). O’Brien in dicta said that
plaintiffs are similarly situated when “their claims [are] unified by common theories of
defendants’ statutory violations, even if the proofs of these theories are inevitably individualized
and distinct.” Id. at 585. But O’Brien’s point was that, if plaintiffs offer a trial plan that enables
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them to prove their case on a class-wide basis, the court should permit the suit to proceed as a
collective action. Such a trial plan, in some cases, may involve “individualized” presentations of
proof; in other cases, representative proof may suffice. Id. But in all cases, plaintiffs must offer
some reasoned method for the jury to assess class-wide liability—and that is just what the
plaintiffs failed to do here. As for O’Brien’s holding, it was that the opt-in plaintiff was not
similarly situated to the other plaintiffs, “because she failed to allege that she suffered from” the
“unlawful practice[s]” endured by those employees. Id. at 586. Just so here, where the plaintiffs
failed to offer a means of proving that they suffered from “unlawful practice[s]” on a class-wide
basis.
Finally, the plaintiffs (and the majority) try to distinguish this case from the Seventh
Circuit’s decision in Espenscheid. It is true that the Seventh Circuit applies the Rule 23 class-
action standard to assess whether plaintiffs are “similarly situated” and that our circuit has
rejected Rule 23(b)(3)’s “predominance” inquiry as an element of the “similarly situated”
analysis. Compare Espenscheid, 705 F.3d at 772, with O’Brien, 575 F.3d at 584–85. But that
makes no difference here. Under both the Seventh Circuit’s approach and our own, one way for
plaintiffs to satisfy the “similarly situated” inquiry is to allege “common theories” of liability that
can be proved on a class-wide basis. See O’Brien, 575 F.3d at 585. That is exactly what the
Seventh Circuit found to be missing when it held that the Espenscheid plaintiffs failed to
distinguish “benign underreporting from unlawful conduct.” 705 F.3d at 774. And that is
exactly what is missing here. The majority also notes that Espenscheid involved a larger group
of plaintiffs than this case. But that had no bearing on the Seventh Circuit’s analysis. Nor could
it. Whether the collective action consisted of twenty employees or two thousand, the problem
was that those employees could not prove class-wide liability—and the same reasoning applies
to the class of two-hundred-plus plaintiffs today. An error does not become harmless because it
affects “just” 200 people or “just” two companies.
Seventh Amendment. It should come as no surprise that a skewed liability determination
leads to a skewed damages calculation. The majority to its credit corrects one problem with the
damages calculation. I would correct the other. The plaintiffs provided no evidence from which
the jury (or, alas, the court) could conclude that the testifying plaintiffs failed to record a
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comparable number of hours on their timesheets as their non-testifying peers. The district court
nonetheless adopted a trial procedure that assumed that each of the testifying and non-testifying
employees was similarly situated for purposes of calculating damages. That procedure not only
ignored the non-representative nature of the proof but it also violated the Seventh Amendment.
Here’s how the district court calculated damages: When the jury returned a verdict for
the plaintiffs, it identified the average number of weekly hours that each of the seventeen
testifying employees had worked but had not recorded on their timesheets. The court then
averaged together the number of unrecorded hours for each testifying employee, assumed that
this value was also the average number of unrecorded hours for each of the 279 non-testifying
employees, and awarded damages to the class as a whole.
The Seventh Amendment bars this judge-run, average-of-averages approach. “In Suits at
common law, where the value in controversy shall exceed twenty dollars,” the Amendment
reads, “the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise
re-examined in any Court of the United States, than according to the rules of the common law.”
U.S. Const. amend. VII. That means a court may not “substitut[e] its own estimate of the
amount of damages which the plaintiff ought to have recovered[] to enter an absolute judgment
for any other sum than that assessed by the jury.” Lulaj v. Wackenhut Corp., 512 F.3d 760, 766
(6th Cir. 2008) (quotation omitted). Yet that is just what the court did. The jury awarded
damages to the seventeen testifying plaintiffs, but the court—on its own and without any jury
findings—extrapolated that damages award to the remaining 279 plaintiffs.
The plaintiffs defend this procedure by noting that a court may “render judgment as a
matter of law as to some portion of a jury award if it is compelled by a legal rule or if there can
be no genuine issue as to the correct calculation of damages.” Id. But the district court did not
award damages based on a legal conclusion; it did so based on its finding that the non-testifying
plaintiffs failed to record the same number of hours, on average, as their testifying peers. That is
a factual finding about the number of hours worked by each plaintiff. And the Seventh
Amendment means that a jury, not a judge, must make that finding.
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The majority portrays the district court’s damages determination as a matter of
“arithmetic,” a “formulaic or mathematical calculation.” Supra at 28. How could that be?
There was no finding by the jury about the overtime hours worked by the non-testifying
employees and thus no basis for the judge to do the math or apply a formula. Imagine that ten
plaintiffs bring a lawsuit. The court gives the jury a verdict form, listing the names of five
plaintiffs and asking the jury to write down the amount of damages those plaintiffs should
receive. After the jury does so, the judge decides that the remaining five plaintiffs are similar to
their peers and decides they should receive damages too, all in the absence of any finding by the
jury about the similarity of the two classes of plaintiffs. It then doubles the jury’s award and
gives damages to all ten plaintiffs. I have little doubt we would find a Seventh Amendment
violation, and the majority says nothing to suggest otherwise. See Chauffeurs, Teamsters &
Helpers, Local No. 391 v. Terry, 494 U.S. 558, 570 (1990); Wallace v. FedEx Corp., 764 F.3d
571, 591–94 (6th Cir. 2014). That conclusion should not change simply because this case arises
in the collective-action context, where the “estimated average approach” is the accepted practice.
The missing ingredient is that the jury, not the judge, must still determine the “estimated
average” that each plaintiff should receive. And no court to my knowledge—either in the
collective-action context or outside of it—has endorsed a procedure by which the jury awards
damages to testifying plaintiffs while the judge awards damages to their non-testifying
counterparts with no finding from the jury as to the latter group.
Nor did the district court cure the problem when it instructed the jury that non-testifying
plaintiffs would be “deemed by inference to be entitled to overtime compensation.” R. 463
at 28. This instruction told the jury only that, if it found liability with respect to the testifying
plaintiffs, it also was finding liability with respect to the non-testifying plaintiffs. The court did
not inform the jury that its damages calculations would be averaged together to make a class-
wide finding. Nor did the court charge the jury with determining the estimated average that each
plaintiff should receive. All the instructions did, in effect, was tell the jury that the judge would
calculate damages. But it should go without saying that a court cannot correct a Seventh
Amendment violation by informing the jury that a Seventh Amendment violation is about to
occur.
14-6063 Monroe, et al. v. FTS USA, et al. Page 41
For the same reason, Mt. Clemens Pottery has nothing to do with this case. It is not a
Seventh Amendment case. It did not permit a judge, rather than a jury, to decide whether the
damages of the testifying and non-testifying employees were similar and thus could be assessed
on an “estimated average approach.” And it involved compensation for employees’ preliminary
work activities, which took roughly the same amount of time for each employee to perform. 328
U.S. at 690–93. The jury in today’s case, however, found that the number of unrecorded hours
varied widely among the testifying technicians—from a low of eight hours per week to a high of
twenty-four, with considerable variation in between. This range of evidence increased the risk of
under-compensation for employees who worked the most hours (and over-compensation for
those who worked the fewest) in a way that Mt. Clemens Pottery never needed to confront. And
that risk of course heightens the importance of keeping the damages determination where it
belongs—with the jury, which is best equipped to undertake the intricate fact-finding required
when the employees’ unrecorded hours span so broadly.
Herman v. Palo Group Foster Home, Inc., is of a piece. 183 F.3d 468 (6th Cir. 1999). It
stated that the Mt. Clemens Pottery framework enables juries to find damages “as a matter of just
and reasonable inference” when employers do not keep adequate records of their employees’
time. Id. at 472. Nowhere does Herman endorse the procedure used in this case, which
permitted the court to assume (not even infer) that all employees failed to record the same
number of hours on their timesheets.
The majority claims in the alternative that the defendants forfeited their claim to a jury
trial on damages. Not true. The defendants opposed the district court’s ruling that the court
could calculate damages, and they reiterated their objections at a post-trial status conference.
Consistent with these objections, the district judge did not decide that defendants forfeited the
point. He instead explained he was “at a little bit of a loss” because he had not tried the case and
only “now” “realize[d]” that a “residual issue” remained. R. 444 at 6. In response, the district
court offered to call a second jury to calculate damages, and asked the defendants what steps
would be “appropriate[.]” Id. at 6–7. Counsel responded, “[W]e think the only thing . . . that’s
left and that is appropriate is an entry of judgment . . . either for the defense or liability for
plaintiffs . . . with zero damages.” Id. at 7. “[P]art of our position,” counsel concluded, “is to be
14-6063 Monroe, et al. v. FTS USA, et al. Page 42
clear for any type of post-trial appellate record” that the defendants were “not waiving . . . or
changing their position.” Id. at 19–20. Nowhere in this exchange do the defendants forfeit their
Seventh Amendment argument; at times they indeed reaffirm it. Of course, even if the
defendants had forfeited or for that matter waived their right to a jury trial (which they did not),
the appropriate response would have been to conduct a bench trial on damages, not to impose
damages as a matter of law with no finding by anyone—judge or jury—about the right amount.
Cf. Singer v. United States, 380 U.S. 24, 26 (1965).
* * *
It is not difficult to imagine how this case could have gone differently. The plaintiffs
could have organized themselves into sub-classes, one corresponding to each type of alleged
statutory violation. See, e.g., Fravel v. County of Lake, No. 2:07 cv 253, 2008 WL 2704744, at
*3–4 (N.D. Ind. July 7, 2008). Or they could have complained to the Department of Labor,
which may seek damages on the employees’ behalf. See 29 U.S.C. § 216(c); Espenscheid,
705 F.3d at 776. But the plaintiffs did not take either route. Because they did not do so—
because they proposed a trial plan that violated both statutory and constitutional requirements—
we should remand this case and allow them to propose a new procedure that permits reasoned
and fair adjudication of their claims.
The majority seeing things differently, I respectfully dissent.