Garcia v. Wal-Mart Associates, Inc.

District Court, S.D. California·Decided June 23, 2022·No. 3:18-cv-00500·Unknown

Opinion

1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA 11 12 JULIO GARCIA, Case No.: 18-cv-00500-L-MDD

13 Plaintiff, CLASS ACTION 14 v. ORDER DENYING WALMART’S 15 WAL-MART ASSOCIATES, INC., et al., MOTION TO DECERTIFY CLASS 16 Defendants. ACTION AND DISMISS PAGA CLAIMS [ECF NO. 96] 17

18 19 Pending before the Court is Defendants’ Motion to Decertify Class Certification 20 and Dismiss PAGA claims in this class action alleging violations of the California Labor 21 Code. [ECF No. 96.] Plaintiffs oppose. The Court decides the matter on the papers 22 submitted and without oral argument. See Civ. L. R. 7.1(d.1). For the reasons stated 23 below, the Court DENIES Defendants’ Motion. 24 I. BACKGROUND 25 This is a class action alleging Defendants Wal-Mart Associates, Inc. and Wal-Mart 26 Stores, Inc. (collectively “Defendants”) violate California Labor Code §§ 201-203 by 27 failing to pay its separating employees, whether involuntarily terminated or voluntarily 28 1 resigned, all final wages within the timing requirements set forth by statute. Defendants, 2 the self-proclaimed largest retailer in the world, employ millions of workers 3 worldwide. In California, from February 1, 2015, to November 23, 2018, Defendants 4 terminated 175, 684 workers. On the termination or separation date, Human Resources 5 staff initiates a calculation request to determine the amount to be paid as final wages to 6 the former employee. Defendants provide a written check to the former employee for 7 wages due at the point of termination. At times, Defendants’ calculation of the 8 employee’s final wages is not based on all wages the employee is owed because 9 Defendants’ payroll and timekeeping systems and databases do not reflect all earned 10 wages due and owing to the former employee at the time of termination. As a result, 11 Defendants then pay employees additional wages, earned prior to termination, after the 12 former employee’s termination. 13 Plaintiff filed a First Amended Complaint on September 12, 2018, seeking (1) 14 waiting time penalties under California Labor Code § 203 and (2) penalties under 15 California’s Private Attorneys General Act, Labor Code § 2698 et seq. (“PAGA”) 16 alleging that he was not paid all of his earned wages at the time of termination. 17 On August 26, 2019, the Court certified a class consisting of: 18 All individuals who worked for Defendants in the State of California whose employment ended at any time from February 1, 2015, through the present, 19 and who received a Statement of Final Pay and then received any additional 20 wages (regular, overtime and/or vacation) on Defendants’ on-cycle payroll immediately subsequent to the issuance of the Statement of Final Pay to the 21 individual. 22 (Order at 8 [ECF No. 48.]) 23 This Court also certified the following subclass: 24 Any and all individuals who worked for Defendants in the State of California whose employment ended at any time from February 1, 2015, 25 through the present, and who received a Statement of Final Pay and then 26 received any additional wages (regular, overtime and/or vacation) more than 3 days after the issuance of the Statement of Final Pay on Defendants’ on- 27 cycle payroll immediately subsequent to the issuance of the Statement of 28 Final Pay to the individual. 1 (Id.) 2 Named Plaintiff Julio Garcia (“Plaintiff” or “Garcia”) worked for Defendant Wal- 3 Mart from December 12, 2007, to January 12, 2017, when his employment was 4 terminated. (First Amended Complaint. (“FAC at ¶ 4, 10). On the date of his 5 termination, Plaintiff clocked in for work at 3:12 pm. (McChristian Dec. ¶ 21). Plaintiff 6 was called into the office seven minutes after he clocked in and was told that his 7 employment was being terminated. (Garcia Depo. 39:12; 39:24-40:1). The termination 8 meeting lasted only a few minutes. (Garcia Depo. 48:6). Plaintiff testified that he walked 9 out of the meeting without clocking out. (Garcia Depo. 49:5-11.) Garcia stated that he 10 was at the store between 20 minutes and one hour on the day he was terminated. (Garcia 11 Depo. 62:4-14). Another employee clocked Garcia out at 4:12 pm, one hour after he 12 clocked in. (McChristian Dec. ¶ 21). Plaintiff did not collect his final check at the 13 meeting, but it was mailed to him along with a Statement of Final Pay (“SOFP”). (Garcia 14 Depo. 67:4-11). 15 According to Garcia, the SOFP reflected 22.59 regular hours at his rate of $15.40 16 per hour. (Garcia Depo 68:4-16). The SOFP designated four hours as Reporting Time 17 pay that accrued on Garcia’s termination date per company policy. (Garcia Depo. 69:16- 18 24). He was also paid for 17.33 hours of unused personal time, and 28.49 hours of Paid 19 Time Off (“PTO”). (Garcia Depo 73:21-25). 20 Approximately two weeks later, on January 26, 2017, Plaintiff received a payment 21 of $12.19 along with a statement of earnings that reflected one additional hour of regular 22 earnings and .1 hour of PTO when compared to his SOFP. (Oppo. at 6-7; Diana 23 McChristian Depo. 54:4-9). Plaintiff alleges that the delayed payment of these wages 24 violates California Labor Code §§ 201, 203. 25 On December 14, 2020, Defendants’ filed a motion for partial summary 26 adjudication, contending that the $12.19 post-termination payment to Plaintiff Garcia did 27 not trigger waiting time penalties because it was not “earned”, and that his PAGA claim 28 fails because it is derivative of the first claim. [ECF No. 80.] The Court denied 1 Defendants’ motion for partial summary judgment, finding that there was a genuine issue 2 of material fact regarding whether Plaintiff was entitled to the one hour of regular wages 3 plus the .1 PTO earned on that hour, therefore the Court was unable to determine whether 4 waiting time penalties under § 203 were triggered. (Order at 10 [ECF No. 91.]) 5 Defendants now argue that the class should be decertified because determination of 6 Defendants’ liability would require individualized assessments of each Plaintiff’s time 7 records and would therefore defeat the Rule 23 commonality and predominance 8 requirements. (Mot. at 11, 14). Defendants further argue that both the class claims and 9 PAGA claims are unmanageable because there is no way to determine whether particular 10 employees are entitled to waiting time penalties without engaging in an individualized 11 analysis of their circumstances. (Mot. at 17-18). 12 II. LEGAL STANDARD 13 Rule 23 provides that “[a]n order that grants or denies class certification may be 14 altered or amended before final judgment.” Fed.R.Civ.P. 23(c)(1)C). “A district court 15 may decertify a class at any time.” Rodriguez v. West Publ'g Corp., 563 F.3d 948, 966 16 (9th Cir. 2009). “A party seeking decertification of a class should bear the burden of 17 demonstrating that the elements of Rule 23 have not been established.” Slaven v. BP 18 America, Inc., 190 F.R.D. 649, 651 (C.D. Cal. 2000) (emphasis in original); Gonzales v. 19 Arrow Fin. Servs., Inc., 489 F. Supp. 2d 1140, 1153 (S.D. Cal. 2007). 20 In order to determine whether decertification is mandated, a Court must determine 21 whether Defendant has met its burden to show that the requirements of Rules 23(a) and at 22 least one of the requirements of 23(b) are not met.

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