On March 29, 2017, in Scott v. Chipotle Mexican Grill, Inc., the Southern District of New York denied Plaintiffs’ motion for class certification under Rule 23 of the Federal Rules of Civil Procedure (“Rule 23”) and granted Defendants’ motion to decertify Plaintiffs’ conditionally certified collective action under Section 216(b) of the Fair Labor Standards Act (“FLSA”).

In this case, seven current and former Chipotle “apprentices” from six different states (along with 516 opt-in plaintiffs) brought suit against Chipotle under the FLSA and parallel state laws, alleging that they performed little to no managerial work, and as such, were improperly classified as exempt from overtime pay under the executive exemption. Applying a low standard for conditional certification under the FLSA, the court conditionally certified the collective action. After extensive discovery, Chipotle moved to decertify the conditional collective action under the FLSA and Plaintiffs moved to certify several smaller state law class actions under Rule 23.

While the Southern District of New York held that Plaintiffs satisfied the Rule 23(a) requirements for class certification, extensive differences among Plaintiffs’ responsibilities led the court to conclude that Plaintiffs could not satisfy the predominance and superiority requirements of Rule 23(b). Although Chipotle had only one job description for the “apprentice” position and even though Chipotle concluded through its own internal audit that all apprentices had the same responsibilities, deposition testimony contradicted this and instead tended to show that not all apprentices had the same responsibilities. In fact, factors such as store structure, sales volume, staff size, and managerial style determined the extent of the apprentices’ managerial responsibilities. For example, some apprentices testified that they had almost no say in personnel decisions, while others testified that they routinely made hiring, scheduling, and training recommendations.

This difference in responsibilities led the court to conclude that individualized inquiries would be necessary to determine whether each apprentice was exempt from overtime compensation. As a result, the court found that class issues did not predominate. The court also found that the significant variation between the applicable state wage and hour laws would effectively require the court to conduct numerous “mini-trials” to determine whether Chipotle misclassified each individual apprentice. Based on these differences, the court concluded that superiority was also lacking, and as such, denied Plaintiffs’ motion for Rule 23 class certification.

For many of the same reasons, the court also granted Chipotle’s motion to decertify the conditional collective action under the FLSA. The court observed that any other decision “would reduce Section 216(b)’s requirement that plaintiffs be ‘similarly situated’ to a mere requirement that plaintiffs share an employer, a job title, and a professed entitlement to additional wages.”

If you believe that your employer is violating the FLSA and/or the NY Labor Law by misclassifying you as exempt and not paying proper overtime compensation, it’s important to speak with a New York City wage and hour attorney to properly assess and determine all of your legal rights.

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