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Mayhew v. Loved Ones in Home Care, LLC

United States District Court, S.D. West Virginia, Charleston

December 1, 2017

PAMELA MAYHEW, BETSY FARNSWORTH, on behalf of themselves and others similarly situated, Plaintiffs,


          John T. Copenhaver, Jr., United States District Judge

         Pending before the court is the plaintiffs' motion for conditional certification of the present action as a collective action under the Fair Labor Standards Act (the “Act”), 29 U.S.C. § 216(b), filed on August 30, 2017. Plaintiffs seek such certification on behalf of all similarly situated employees of the defendants impacted by the same or similar pay practices as those pay practices that deprived plaintiffs of overtime pay. The motion is accompanied by plaintiff Mayhew's affidavit. Defendants have filed a response in opposition. Plaintiffs, alleging a willful violation, seek recovery for the three years that precede the filing of the original complaint on July 28, 2017. Among its other affirmative defenses, Loved Ones contends it was exempt from the Act's overtime pay requirements, based on 29 U.S.C. § 213(a)(15), the scope of which arguably encompassed home health care workers, such as the plaintiffs.

         I. Facts

         The court accepts the background facts, primarily as they are presented in the motion as well as in the second amended complaint (hereinafter “Complaint” or “Compl.”), as true for the purposes of considering this motion. Plaintiffs have worked for defendant Loved Ones, a third party provider of home health care services in West Virginia, as home health care workers. Defendant Donna Skeen is a “member or the managing member” of Loved Ones, controls its “day-to-day operations, ” and is an “employer” as that term is defined in the Act. 29 U.S.C. § 203(d); Compl. ¶ 3. Plaintiff Mayhew is affiliated with Loved Ones' office in South Charleston, and plaintiff Farnsworth is affiliated with its location in Ripley.

         While plaintiffs regularly and consistently worked in excess of a forty-hour workweek and were allegedly at no time exempt from the Act's wage and hour requirements, they were not paid all of the overtime pay they were owed until defendants changed their payroll practices in May 2017 to bring them into compliance. Defendants' failure to pay an enhanced overtime rate was allegedly “deliberate and knowing” as evidenced by the “elaborate measures Defendants have employed to avoid detection and challenge.” Compl. ¶ 11. As a significant part of that failure, between “early” 2016 and May 2017, defendants made out two distinct paychecks for each workweek with straight-time compensation on each check without regard for hours on the other. At other times (presumably prior to early 2016), defendants did not pay overtime despite including all the time on a single paycheck. Id. ¶¶ 12-14. Other employees were also adversely affected by similar payroll practices, which were based on uniform protocols. Id. ¶ 15, 22; Ans. to Compl. ¶ 19. When Mayhew asked her employer about the overtime pay practices, she was told that the practices were “legal and proper because they paid hours by individual funding sources.” Mot. at 4. Loved Ones explains that as a home health aide/home care provider, Mayhew serves clients under two separate programs, the personal care program and the Medicaid waiver program, which were treated as distinct for payroll purposes during the period from early 2016 to May 2017. ECF No. 8 at 10. Thus, during that period, she was treated as if she had two separate jobs for overtime pay purposes.

         While, as already noted, plaintiffs maintain that they were covered by the Act's protections at all relevant times, a new administrative rule issued by the United States Department of Labor (“DOL”) made them “specifically subject” to these protections. Compl. ¶¶ 7-8. The rule, with the original effective date of January 1, 2015, governs the application of the Act's protections to the home health care industry in general and to the plaintiffs in particular. Application of the Fair Labor Standards Act to Domestic Service, 78 Fed. Reg. 60454-01 (Oct. 1, 2013). The rule interprets the Act's exemption for “any employee employed in domestic service employment to provide companionship services for individuals who (because of age or infirmity) are unable to care for themselves.” 29 U.S.C.A. § 213(a)(15). With respect to third party employers such as Loved Ones, the rule states as follows:

Third party employers of employees engaged in companionship services within the meaning of § 552.6 may not avail themselves of the minimum wage and overtime exemption provided by section 13(a)(15) of the Act, even if the employee is jointly employed by the individual or member of the family or household using the services.

29 C.F.R. § 552.109.

         In contrast, before the new rule went into effect, the statutory exemption for companionship services included employees of third party providers, such as Loved Ones, which arguably made its conduct lawful at the time. See Home Care Ass'n of Am. v. Weil, 799 F.3d 1084, 1087 (D.C. Cir. 2015). Understandably, defendants assert the statutory exemption as one of their affirmative defenses. Ans. at 7.

         This rule had initially been stayed pursuant to a decision by the U.S. District Court for the District of Columbia, but on August 21, 2015, the D.C. Circuit overturned the vacatur of the rule, ordering the district court to enter summary judgment in favor of the DOL. Weil, 799 F.3d at 1097. As a result of this delay, the DOL has chosen to enforce the new rule starting on November 12, 2015, thirty days after the D.C. Circuit issued a mandate directing the district court to enter summary judgment, pursuant to its policy. 80 Fed. Reg. 65646, 65647 (Oct. 27, 2015), whereas plaintiffs assert the rule's effective date to be January 1, 2015.

         Mayhew complained to the DOL in early 2017, seeking the back overtime pay she was owed. While communicating with the DOL investigators, Mayhew was informed of “DOL's preliminary opinion” that defendants had engaged in similar conduct that violated the Act with respect to seventy other employees working out of the same South Charleston office. Farnsworth was subject to the same conduct even though she works out of Ripley. Compl. ¶¶ 20-21. The parties agree that the DOL is now in the process of attempting to calculate and to settle overtime claims of approximately 230 similarly situated employees working out of defendants' various locations. Id. ¶ 17; Ans. ¶ 17.

         As was already noted, in May 2017, Loved Ones changed its overtime pay policy across the board, so the plaintiffs received the overtime pay that was due them after that date. After Mayhew learned that, pursuant to the agency's general written policy, DOL would only seek wages back to November 2015, she instituted the present action with the assistance of her private counsel, and Farnsworth later joined the action.

         Plaintiffs seek damages (including overtime pay due, liquidated damages and attorney fees, costs, and interest) under 29 U.S.C. § 255 for willful violations of the Act, incurred over a period of three years that predate the filing of the complaint. In addition, they seek this present certification to issue notice to all similarly situated plaintiffs. Compl. ¶ 29.

         Loved Ones requests that the certification be denied or, alternatively, stayed pending the DOL settlement, or limited in scope.

         II. Discussion

         A. Conditional Certification of ...

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