The Fair Labor Standards Act governs claims for unpaid overtime.  The FLSA also allows for the certification of a collective action, which is a form of class action in which multiple employees can join as plaintiffs.  As part of the collective action process, the court authorizes a notice that is sent to prospective class members.  The notice gives the prospective plaintiffs the opportunity to "opt in" to the collective action.  The means of notice and the form of the notice are often hotly contested.

Judge Gray Miller of the Southern District of Texas recently issued a series of rulings on the form of notice in a number of collective actions against Wells Fargo that have been consolidated in his court for pretrial purposes.  The case is In re Wells Fargo Wage and Hours Employment Practices Litigation (MDL Case No. H-11-2266 (May 17, 2013).

The plaintiffs submitted a proposed class notice, and Wells Fargo raised a number of objections to the form of the notice.  The defendants also objected to the means of notice.  The notable rulings by Judge Miller include the following:

Means of Service

Collective action notices are normally served by regular U.S. mail.  The plaintiffs sought (1) to obtain the prospective class members' e-mail addresses so that they could be notified in that manner, (2) to provide notice through Wells Fargo's internal e-mail system, (3) to post the notice on a website, (4) to send a reminder notice to the prospective class members, and (5) to contact the prospective class members through a recorded telephone message.  Judge Miller rejected the requests for e-mail notifications on the ground that it would not facilitate notice.  Judge Miller also rejected the requests for reminder notices and recorded telephone messages as unnecessary and inappropriate.  However, Judge Miller permitted the plaintiffs to post the notice on a website.

The plaintiffs also sought to require Wells Fargo to provide social security numbers for any former employees whose notices were returned as undeliverable.  Judge Miller granted this request, but stressed that the social security numbers must be kept strictly confidential.

Form of the Notice

Judge Miller made a number of rulings with respect to the form of the notice:

  1. Judge Miller rejected language in the proposed notice referring to a previous $20 million settlement by Wells Fargo in a separate case.  Judge Miller permitted a reference to the settlement because the prospective class members needed to be informed that they could join the current collective action even if they had participated in the prior action, but he ordered that the reference to the amount of the settlement be stricken.
  2. Judge Miller permitted language indicating that the notice had been approved by the court.  The plaintiffs had agreed to remove that language from the boldfaced title of the notice, but it remained in the body of the notice.
  3. Judge Miller modified language addressing the effect of the statute of limitations on prospective class members who did not join.  Judge Miller found that "the proposed notice should inform the potential plaintiffs about what rights they do and do not have," but should not be phrased in a way that would coerce them into joining the collective action.
  4. Judge Miller approved language addressing the prohibition on retaliation by Wells Fargo against employees who joined the collective action.  Judge Miller rejected the argument that the notice should inform the prospective class members that that are protected from retaliation by other employees, because the FLSA contains no such protection.
  5. Judge Miller rejected Well Fargo's request for language informing the prospective class members that they could be liable for court costs if they lost.  Judge Miller stated: "There are no counterclaims asserted, and there is no reason to believe any costs assessed should Defendants prevail would be more than minimus with respect to each plaintiff. Thus, the court does not believe requiring a warning about potential liability for Defendants' costs is appropriate."

David C. Holmes is a Houston employment lawyer with The Law Offices of David C. Holmes