United States District Court, M.D. Florida, Fort Myers Division
REPORT AND RECOMMENDATION
MCCOY UNITED STATES MAGISTRATE JUDGE.
before the Court is the parties' Joint Motion to Approve
Settlement Agreement and to Dismiss with Prejudice on
November 18, 2019. (Doc. 10). Plaintiff Vivian Ortiz Mills
(Plaintiff) and Defendants Key Claims Consultants, LLC.,
f/k/a/ Key Claims Consultants Inc. and George W. Keys
(Defendants), jointly request that the Court approve the
parties' settlement of the Fair Labor Standards Act
(“FLSA”) wage claims asserted in this case. After
a careful review of the parties' submissions and the
court file, the Undersigned recommends approval of the
approve the settlement of a FLSA claim, the Court must
determine whether the settlement is a “fair and
reasonable resolution of a bona fide dispute” of the
claims raised pursuant to the Fair Labor Standards Act
(“FLSA”). Lynn's Food Store, Inc. v.
United States, 679 F.2d 1350, 1355 (11th Cir. 1982); 29
U.S.C. § 216. There are two ways for a claim under the
FLSA to be settled or compromised. Id. at 1352-53.
The first is under 29 U.S.C. § 216(c), providing for the
Secretary of Labor to supervise the payments of unpaid wages
owed to employees. Id. at 1353. The second is under
29 U.S.C. § 216(b) when an action is brought by
employees against their employer to recover back wages.
Id. When the employees file suit, the proposed
settlement must be presented to the district court for the
district court's review and determination that the
settlement is fair and reasonable. Id. at 1353-54.
Eleventh Circuit has found settlements to be permissible when
the lawsuit is brought by employees under the FLSA for back
wages. Id. at 1354. The Eleventh Circuit has held
[a lawsuit] provides some assurance of an adversarial
context. 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
dispute; we allow the district court to approve the
settlement in order to promote the policy of encouraging
settlement of litigation.
Id. at 1354.
Complaint, filed October 8, 2019, Plaintiff Ortiz alleges
that Defendants misclassified Plaintiff as an independent
contractor throughout her employment as an insurance
attendant from at least December 2017, though March 2019.
(Doc. 1 at 4). Plaintiff alleges during her employment with
Defendants, Plaintiff was required to perform work for which
she was not compensated. (Id.). Specifically,
Plaintiff alleges during her employment she was paid $20.00
per hour, with no premium for the overtime hour Plaintiff
worked in excess of forty hours. (Id. at 5).
Plaintiff alleges Defendants failure to properly compensate
her was willful and showed reckless disregard for the
provisions of the FLSA. (Id. at 6). Therefore,
Plaintiff requests this Court to award compensation for hours
worked over 40-hours in a workweek, liquidated damages and an
award of reasonable attorneys' fees and costs pursuant to
29 U.S.C. §216(b). Defendants did not file a timely
response, but on November 18, 2019, the parties filed a Joint
Motion for Settlement whereas Defendants denied wrongdoing
and vigorously dispute whether Plaintiff was improperly
classified as an independent contractor. (Doc. 10 at 1).
OF THE PROPOSED SETTLEMENT
is a threshold question as to whether judicial approval of
the proposed settlement is actually required. In the proposed
settlement agreement, the parties recite:
WHEREAS, Plaintiff calculated the maximum amount of overtime
she could be owed, and Defendants agreed to pay this amount,
plus an equal amount in liquidated damages, in addition to
Plaintiff's reasonable attorneys' fees and costs.
(Doc. 10-1 at 1). This recital suggests that Plaintiff's
FLSA claim was not compromised and, therefore, no Court
approval is required. However, the ...