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Deslandes v. Bam-B Enterprises of Central Florida, Inc.

United States District Court, M.D. Florida, Orlando Division

June 28, 2018




         Pending before the Court is the parties' Joint Motion to Approve FLSA Settlement and Dismiss the Action with Prejudice (Doc 43). Upon due consideration, I respectfully recommend that the motion be GRANTED.

         I. Background

         Plaintiff filed this putative collective action in state court alleging claims under the Fair Labor Standards Act (“FLSA”) 29 U.S.C. § 201 et seq., and state law claims of quantum meruit and unjust enrichment, all arising out of an alleged failure to pay overtime compensation (Doc. 2). Plaintiff alleges that the corporate Defendant and the individual Management Defendants failed to pay her overtime wages in connection with work she performed as a manager at Defendants' McDonald's restaurant (Doc. 2). On July 28, 2017, Defendant removed the action to this Court (Doc. 1). Defendants filed an answer disputing Plaintiff's claims, and raised numerous affirmative defenses (Doc. 18).

         In her answers to the Court's interrogatories, Plaintiff said she was unable to provide an accurate accounting of her claim, but referred to the payroll records (Doc. 21).

         In Plaintiff's Amended Answers to Court Interrogatories (Doc. 23), she said she worked approximately ten hours of overtime each week at an overtime rate of $18.00 per hour (i.e., $180/week). The parties agree that, based on Plaintiff's December 2015 termination date and the date this action was initiated, the most Plaintiff could seek under the FLSA's statute of limitations was a total of 82 weeks of pay, or $14, 760 in alleged unpaid overtime, plus the same amount in liquidated damages (Doc. 43 at pp. 2-3).

         The parties exchanged information and, on April 26, 2018, participated in a settlement conference before the Honorable Gregory J. Kelly (Doc. 35). The parties represent that they reached an agreement to settle Plaintiff's claim for alleged wages for a specific amount to be paid to Plaintiff, but did not reach agreement on the amount of Plaintiff's attorneys' fees and costs to be paid by Defendants. The parties engaged in further dis c us s io ns and I d i rec ted the filing o f a s tatus repo rt, advis ing them that the claim must be completely settled or the parties must file a completed Case Management Report, so that the case can be scheduled for trial (Doc. 36). The parties have now reached an agreement to completely settle all of Plaintiff's claims, including Plaintiff's claim for attorneys' fees and costs, and present their agreement for review and approval (Doc. 43-1).

         II. Discussion

         Legal Standard

         “The principal congressional purpose in enacting the Fair Labor Standards Act of 1938 was to protect all covered workers from substandard wages and oppressive working hours, ‘labor conditions [that are] detrimental to the maintenance of the minimum standard of living necessary for health, efficiency and general well-being of workers.'” Barrentine v. Ark.-Best Freight Sys., Inc., 450 U.S. 728, 739 (1981) (alternation in original) (quoting 29 U.S.C. § 202(a)). “Any employer who violates the provisions of section 206 or section 207 of [the FLSA] shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, and in an additional equal amount as liquidated damages.” 29 U.S.C. § 216(b). Section 206 establishes the federally-mandated minimum hourly wage, and § 207 prescribes overtime compensation of “one and one-half times the regular rate” for each hour worked in excess of forty hours during a given workweek. The provisions of the FLSA are mandatory and “cannot be abridged by contract or otherwise waived.” Barrentine, 450 U.S. at 740. To permit otherwise would “‘nullify the purposes' of the [FLSA] and thwart the legislative policies it was designed to effectuate.” Id. (quoting Brooklyn Sav. Bank v. O'Neil, 324 U.S. 697, 707 (1946)).

         The parties seek judicial review and a determination that their settlement of Plaintiff's FLSA claim is a “fair and reasonable resolution of a bona fide dispute” over FLSA issues. See Lynn's Food Stores, Inc. v. United States, 679 F.2d 1350, 1354-55 (11th Cir. 1982). If a settlement is not one supervised by the Department of Labor, the only other route for compromise of FLSA claims is provided in the context of suits brought directly by employees against their employers under section 216(b) to recover back wages for FLSA violations. “When employees bring a private action for back wages under the FLSA, and present to the district court a proposed settlement, the district court may enter a stipulated judgment after scrutinizing the settlement for fairness.” Id. at 1353 (citing Schulte, Inc. v. Gangi, 328 U.S. 108 (1946)).

         The Eleventh Circuit has held that “[s]ettlements may be permissible in the context of a suit brought by employees under the FLSA for back wages because initiation of the action by the employees provides some assurance of an adversarial context.” Id. At 1354. In adversarial cases:

The employees are likely to be represented by an attorney who can protect their rights under the statute. Thus, when the parties submit a settlement to the court for approval, the settlement is more likely to reflect a reasonable compromise of disputed issues than a mere waiver of statutory rights brought about by an employer's overreaching. If a settlement in an employee FLSA suit does reflect a reasonable compromise over issues, such as FLSA coverage or computation of back wages that are actually in ...

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