By Brandi O. Brown, J.D.
In an Equal Pay Act suit against a clothing designer and store that gave only male sales associates $12,000 clothing allowances, a federal district court in New York conditionally approved collective action. The plaintiff easily made the required “modest factual showing” that the proposed plaintiffs were similarly situated. However, the court declined to make a “categorical ruling” regarding tolling of the statute of limitations for all potential plaintiffs and it ruled that notice should be limited to those employed within the three-year limitations period (Knox v. John Varvatos Enterprises Inc., October 17, 2017, Gorenstein, G.).
After a brief period of employment with the defendant, the named plaintiff, who had worked as a sales associate for the clothing retailer, filed suit alleging it violated the EPA by offering male associates a significant clothing allowance while denying that allowance to female associates. The employer operates 22 stores in the United States, including the New York location where the plaintiff worked. According to the employee, from at least as early as 2014, the employer offered a clothing allowance to male sales associates, up to $12,000 per year.
Dress code. The employer’s written dress code states that “all male retail employees receive a clothing allowance” and the employee was told by HR that the employer did not provide such an allowance to female employees. In fact, the employer did not dispute the existence of the policy. According to its opposition memorandum, the policy is “giving a credit to male sales professionals who, unlike female sales professionals, are required to wear expensive [JV] menswear while working.” The employee filed a motion with the court seeking an order to allow the case to proceed as a collective action and to allow notice to be sent to all current and former female sales associates employed since February 1, 2014.
Modest showing made. As to EPA claims, said the court, the focus of the inquiry at the conditional certification stage is not on whether an actual violation of the law occurred but instead on whether the proposed plaintiffs were “similarly situated” with regard to their allegations. In this case the employee argued that she was similarly situated to all female sales associates who were employed by the defendant because they were all subjected to the same policy that was alleged to violate the EPA. Only a “modest factual showing” was required, and the employee “easily” made it based on her observations and the employer’s “numerous statements” regarding the policy. The evidence presented at this stage was “more than sufficient” to satisfy the low burden.
The court also made short shrift of the employer’s argument that the employee had not filed a “written consent to become a party plaintiff” by noting that she had since done so. Likewise, it explained that she was not required, at this stage, to demonstrate that her duties as a sales associate were identical to those of all female employees. Finally, the court declined to consider, as prematurely made, the employer’s argument regarding whether the employee had demonstrated that any of the potential plaintiffs had worked in the same “establishment” as a male comparator or that they performed “equal work” to their male counterparts.
Equitable tolling. More difficult for the court was the question of whether equitable tolling should be applied across-the-board for potential opt-in plaintiffs. The employee argued that courts in the Second Circuit frequently applied tolling after a plaintiff files a conditional approval motion, but she provided no facts or even arguments regarding existing or potential opt-in plaintiffs showing that employees had been diligently pursuing their rights. That showing, the court explained, is the necessary first step in demonstrating that the doctrine should be applied and the diligence of the named plaintiff could not suffice to demonstrate the diligence of those opt-in plaintiffs who might seek to have the doctrine applied. Thus, the employee’s “application for a categorical ruling tolling the statute of limitations for all opt-in plaintiffs” was denied.
The court also declined the employee’s invitation to have notice sent to employees whose employment ended before the start of the three-year period. Although some courts have allowed such an expansion, the court here disagreed with those cases to the extent that they did not include an analysis of the potential for equitable tolling based on the facts of the case. This was particularly of concern since in the Second Circuit such tolling should occur only in “rare” situations and should be applied on a “case-by-case basis.” Instead, the court considered but failed to find more than conclusory allegations in support of, “at least a ‘realistic possibility’” that those outside-of-the-lines employees might be able to show that tolling should be applied.
Notice. The remainder of the court’s opinion focused on the details of how recipients of notice would be identified, what it would include, and how it would be delivered (by first class mail and email). The court rejected the employee’s request that the employer produce the birth dates and work locations of potential opt-in plaintiffs, but granted her request for their names, mailing addresses, telephone numbers, email addresses, and dates of employment. It also agreed that a statement should be included in the introduction that it “has not yet made any decision about whether this lawsuit has merit.” It rejected as argumentative the inclusion of a statement that the employer believed the lawsuit was “meritless” finding it sufficient that it accurately recited that the employer maintained the policy did not violate the law. The court agreed that the notice should inform employees that they might be deposed and that they may be required to produce documents.
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