TGI Friday's Staffers Seek Cert. On Notice Issue In Wage Row

Law360—Shayna Posses
04.13.2017

TGI Friday’s tipped workers asked a New York federal judge on Wednesday to certify a class of employees seeking a determination that the restaurant chain and its former owner denied them proper wage and hour statements, saying that granting the request will move the litigation along and let the court decide common legal issues.

The workers contended that the litigation will be made more efficient by certifying an issue class of people requesting a declaration that TGI Friday’s Inc. and former owner Carlson Restaurants Inc. violated New York labor laws by failing to provide proper wage and hour notices. Resolving these questions through class certification — as well as through a pending motion for partial summary judgment on the notice issue — will streamline discovery, the employees argued.

“Resolution of these and other questions through issue-class certification and partial summary judgment would allow the parties to avoid innumerable deposition questions and other discovery about who said what to whom,” the workers said.

Certifying an issue class will also allow the court’s rulings to apply to the class as a whole, mooting the companies’ contention that the one-way intervention rule bars the judge from deciding these questions now, the workers argued. The rule holds that plaintiffs can’t move for class certification after receiving a favorable ruling on the merits of a claim, with the aim of preventing members of an uncertified class from cherry-picking favorable decisions.

The notice issue is part of a broader suit filed in April 2014, bringing nationwide collective action Fair Labor Standards Act claims and New York labor law claims on behalf of thousands of employees. The litigation alleged that tipped workers were forced to work off the books without pay, to share tips with nontipped workers and to do “side work” that wasn’t tipped at their regular reduced tipping minimum wage.

Carlson sold the chain to Sentinel Capital Partners the following month.

Later that year, the workers added additional employees and class claims under Massachusetts wage and hour laws, and shortly thereafter, Carlson made attempts to pick off named plaintiffs by offering settlements, according to court filings.

The strategy failed, and the court granted the workers conditional certification of the FLSA collective in January 2015, allowing them to send notice to more than 40,000 workers, according to Wednesday’s certification memorandum.

After a previous bid for partial summary judgment on the notice issue was unsuccessful, the workers renewed their request in November. The notice claims involve five of the 14 workers named in the case, according to court filings.

They sought judgment on claims including that the companies violated New York labor laws by failing to provide the legally required annual notice with the employee’s pay rate and notice that extra pay is required if tips fail to bring the employee up to minimum wage.

“Carlson has no excuse for failing to comply with these straightforward requirements because it knew about them, and because the relevant statutes, regulations and wage orders contain examples of compliant notices, which Carlson could have used,” the workers said.

The companies fought back in December, arguing that the law and New York Department of Labor regulations require only that the information be available, not that it be available on a single form, and that TGI Friday's employees were and are supplied this information via their employee handbook, posted notices, explanations by managers and other sources.

That motion is now fully briefed, the workers said Wednesday, noting that the companies suddenly argued in their opposition that the one-way intervention rule kept the court from resolving the motion. Though the argument has no merit, the employees are moving for class certification out of an abundance of caution, they said.

The class meets all of the certification requirements, the employees said, noting that courts routinely certify classes where plaintiffs claim that employers improperly used the tip credit, as well as classes bringing claims related to the New York labor law’s annual notice and wage statement requirements.

They asked that Outten & Golden LLP and Fitapelli & Schaffer LLP be appointed class counsel.

The parties are also sparring over the companies' March request to cut a slew of opt-in plaintiffs who have allegedly failed to participate in the discovery process, which the defendants say has prevented them from obtaining information they need for their defense.

Representatives for the parties didn’t immediately return requests for comment Thursday.

The workers are represented by Justin M. Swartz, Molly A. Brooks, Juno Turner, Deirdre Aaron, Michael J. Scimone, Cheryl-Lyn Bentley, and Chauniqua D. Young of Outten & Golden LLP and Joseph A. Fitapelli, Brian S. Schaffer and Frank J. Mazzaferro of Fitapelli & Schaffer LLP.

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The case is Julio Zorrilla et al. v. Carlson Restaurants Inc. et al., case number 14-cv-2740, in the U.S. District Court for the Southern District of New York.