In employment law, discrimination and unpaid wage and overtime cases are sometimes brought as class actions. Class actions allow one or more employees to represent a larger group of employees who have been harmed in a similar way as the “class representatives.” By bringing a case as a class action, the court can hear the dispute in a more efficient way than hearing perhaps hundreds of individual employees’ cases. Today’s Long Island employment law blog explores an unsettled question about settling cases involving class actions.
On December 12, 2017, in Desrosiers v. Perry Ellis Menswear, LLC, a class action case, the New York Court of Appeals, the highest New York state court, was asked to decide whether members of a class need to be notified when a court dismissed the case or when a settlement occurred, even if the class action had not yet been certified by the court.
Class actions are appropriate when numerous other employees have been harmed by the employer in the same way. It’s a tool available for employees to come together as members of a group and, if a court eventually rules in their favor, all of the class members may be able to benefit from the award granted by the court.
Before a class action can become “official” it must be certified by the court. Certification means that the court must first confirm that continuing as a class is the best option for the parties before the case can proceed. So, for example, if filing separate lawsuits would end up being expensive and time-consuming, a court will likely consider certifying the class.
The Desrosiers case involved two separate lawsuits that were filed as class actions claiming compensation for unpaid minimum wage and overtime pay.
In both cases, the companies extended a settlement offer to some members of the action, but not all. After the offer was accepted, the companies asked the court to dismiss the case. The plaintiffs (those bringing the lawsuit), however, did not agree that the case should have been dismissed right away without first notifying the other class members of the settlement. The companies disagreed and argued that notification was only necessary when a class has been certified, which had not occurred in either case.
At issue in Desrosiers was New York’s Civil Practice Law and Rule (CPLR) 908 which states that in class actions, “notice of the proposed dismissal, discontinuance, or compromise shall be given to all members of the class in such manner as the court directs.”
The question was whether a “class action” as stated in CPLR 908 was one that first required certification by the court or if it also included uncertified actions. If CPLR 908 only applied to certified cases, then the companies would win and the court would not be required to provide the plaintiffs with extra time to notify the other class members of the settlement.
The court was able to make its decision by comparing CPLR 908 with its federal counterpart which was amended in 2003. This change made it clear that under federal law, notice to class members of settlement or dismissal was only needed if the action was certified.
CPLR 908, however, has never been amended to clarify its meaning. For this reason, the Court of Appeals decided that if the State legislature intended the rule to apply only to certified class actions, it would have also changed the rule to state so specifically. Thus, the court ruled in favor of the plaintiff’s and allowed them to notify the other the class members about the settlement.
The decision in Desrosiers prevents sneaky employers from withholding information from additional class members that were not part of the settlement in an attempt to prevent them from knowing that there is a possibility that, they too, could win money if they try to settle the case. Perhaps the expression, “there is strength in numbers” quite literally does apply to class action cases.
If you have questions about class action lawsuits or any workplace related concern, such as unpaid minimum wage or overtime, or employment discrimination, the Long Island employment law firm Famighetti & Weinick, PLLC may be able to help you. Call us at 631-352-0050 to schedule a free consultation. Our website is http://linycemploymentlaw.com.
Today’s Long Island employment law blog was written by Thalia Olaya, a Hofstra Law school student interning at Famighetti & Weinick.
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