Schilling v. PGA Inc.

293 F. Supp. 3d 832
CourtDistrict Court, W.D. Wisconsin
DecidedMarch 14, 2018
Docket16–cv–202–wmc
StatusPublished
Cited by6 cases

This text of 293 F. Supp. 3d 832 (Schilling v. PGA Inc.) is published on Counsel Stack Legal Research, covering District Court, W.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Schilling v. PGA Inc., 293 F. Supp. 3d 832 (W.D. Wis. 2018).

Opinion

WILLIAM M. CONLEY, District Judge

Plaintiffs Eric Schilling, Blaine Krohn and Erik Sinclair assert claims against their employer, PGA Inc., a company specializing in air comfort systems in central Wisconsin, for allegedly calculating overtime wages in violation of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq. , and Wisconsin state labor laws. Specifically, plaintiffs allege that: (1) PGA's policy of not including the "cash fringe rate" in calculating overtime violates both the FLSA and state law; and (2) PGA's policy of paying overtime based on the rate for the work performed during overtime hours, rather than on a "straight-time hourly rate," violates state law.1

The first theory is based on PGA's alleged miscalculation of overtime pay for prevailing wage work. Plaintiff contends that PGA violated state law and the FLSA by failing to pay its employees overtime based on the hourly basic rate plus the cash fringe rate. Instead, plaintiffs claim, PGA calculated overtime for prevailing wage work using only the hourly base rate, and then adding the cash fringe rate to that overtime hourly rate.2 The second theory *836is based on plaintiffs' PGA's allegedly miscalculating overtime using the rate of pay for the work completed during overtime hours, rather than the average straight time hourly rate earned during the workweek.

Consistent with its usual two-step procedure, this court previously certified a conditional FLSA collective action based on the "cash fringe rate" claim. (11/2/2016 Order (dkt. # 24).) Before the court is plaintiffs' motion to certify a Rule 23 class covering both state law claims or two subclasses (dkt. # 45), as well as defendant's motion to decertify the FLSA collective action (dkt. # 53). For the reasons that follow, the court will grant plaintiffs' motion for class certification, certifying a single Rule 23 class covering both overtime claims. For the same reasons, the court will deny defendant's motion to decertify the FLSA collective action.

Finally, before the court are the parties' cross-motions for summary judgment. (Dkt. ## 85, 90.) In light of the parties' reliance on competing Wisconsin administrative code provisions and other administrative documents, and the limited case law as to plaintiffs' specific legal claims, the court believes that oral argument would be worthwhile. Accordingly, the court will hold oral argument at 10:00 a.m. on April 26, 2018.3 Depending on the oral argument and the outcome of summary judgment, the court will reset pre-trial deadlines and a trial date, as necessary.

OPINION

I. Motion for Class Certification

A two-step analysis governs certification of a class action under Rule 23. See Messner v. Northshore Univ. HealthSystem , 669 F.3d 802, 811 (7th Cir. 2012). First, a class must satisfy the four threshold requirements of Rule 23(a): numerosity, commonality, typicality and adequacy of representation. Id. Second, the party seeking certification must satisfy one of the three alternatives under Rule 23(b). Id. The proponent of the class bears the burden of demonstrating that the class meets all of these requirements by a preponderance of the evidence. Id.

The trial court must itself engage in a "rigorous analysis" to determine that the requirements of Rule 23 have been satisfied. CE Design, Ltd. v. King Architectural Metals, Inc. , 637 F.3d 721, 723 (7th Cir. 2011). As a result, Rule 23 considerations may overlap with the merits of the case. Wal-Mart Stores, Inc. v. Dukes , 564 U.S. 338, 131 S.Ct. 2541, 2551, 180 L.Ed.2d 374 (2011). Where they do, "the judge must make a preliminary inquiry into the merits." Szabo v. Bridgeport Machs., Inc. , 249 F.3d 672, 676 (7th Cir. 2001). If material factual disputes exist, the court must even receive evidence and resolve those disputes before determining whether to certify the class, but "should not turn the class certification proceedings into a dress rehearsal for the merits." Messner , 669 F.3d at 811.

Here, plaintiffs seek certification of a single class that covers both theories of recovery, or in the alternative, two subclasses that respectively address the two theories. While both theories here concern overtime pay calculations, the claims rest on different facts and questions of law. Still, there appears to be no conflict of interest. In other words, the interests of class members asserting a cash fringe rate *837claim are not at odds with the interest of class members asserting a straight-time hourly rate claim. Specifically, these claims are not mutually exclusive-a class member could have been subject to either or both alleged overtime miscalculations. As such, two subclasses are not required. See generally 3 William B. Rubenstein et al., Newberg on Class Actions § 7:29 at pp.149-50 (5th ed. 2013) ("Because there is no conflict of interest at issue, there is no necessity that each subclass have different representation and independently comply with all of the requirements of Rule 23(a), (b), and (g)."). At some point, subclasses may be helpful from a management perspective, but the court will consider plaintiff's motion as seeking to certify a single class concerning both overtime challenges, which would also cover both FLSA collective action claims. See id. (explaining the difference between compulsory subclasses to cure conflicts and permissive subclasses for management purposes).

A. Rule 23(a) Requirements

i. Numerosity

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293 F. Supp. 3d 832, Counsel Stack Legal Research, https://law.counselstack.com/opinion/schilling-v-pga-inc-wiwd-2018.