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Knight v. Mill-Tel, Inc.

United States District Court, Tenth Circuit

July 29, 2013

MICHAEL KNIGHT, et al., On Behalf of Themselves and all Others Similarly Situated, Plaintiffs,
v.
MILL-TEL, INC. Defendant.

MEMORANDUM AND ORDER

ERIC F. MELGREN, UNITED STATES DISTRICT JUDGE

Plaintiff Michael Knight, individually and on behalf of others similarly situated, asserts wage and hour claims against Defendant Mill-Tel, Inc., alleging violations of the Fair Labor Standards Act (“FLSA”)[1] and the Kansas Wage Payment Act (“KWPA”).[2] This matter comes before the Court on the Motion for Class Certification of KWPA Claims (Doc. 80), filed by Plaintiffs Michael Knight and Lynn Talbott pursuant to Fed.R.Civ.P. 23.[3] For the reasons set forth below, the Court grants Plaintiffs’ motion for class certification.

I. Background

Defendant Mill-Tel, Inc., is a company that provides cable installation services to telecommunications companies by installing products in consumers’ homes. Plaintiffs Michael Knight and Lynn Talbott, on behalf of themselves and all others similarly situated, are present or former employees of Defendant. Plaintiffs allege that Defendant failed to pay earned overtime compensation in violation of the FLSA and that Defendant wrongfully withheld or deducted earned wages in violation of the KWPA. In its Memorandum and Order dated July 12, 2012 (Doc. 79), the Court granted Plaintiffs’ motion for conditional class certification with respect to their FLSA claims. Plaintiffs now seek class certification with respect to their KWPA claims under Rule 23.

Defendant Mill-Tel, Inc., is Kansas company based in Wichita, Kansas, and also maintains an office in Kansas City, Missouri. Defendant employs Installation Technicians to carry out its installation and service work. Thirty-five Installation Technicians currently work for Defendant, and Defendant employed more than 500 Installation Technicians during the proposed class period from March 29, 2006, to the present.

Defendant used two different systems to pay employees during the proposed class period. Before March 11, 2011, Defendant used a piece rate pay system, which compensated employees for discrete projects performed, but guaranteed a minimum wage. After March 11, 2011, Defendant used an hourly-plus-production-bonus compensation system, under which Installation Technicians earned a set rate for the first forty hours of a workweek, time-and-one-half for all hours worked over forty hours, plus a production bonus as applicable. Defendant described this system as follows:

The way that it works is they go out and they do their tasks at the jobs and they go into a bucket of available, you know, potential earnings. . . . . They have a guaranteed hourly rate what they’re going to make no matter what even if they didn’t do these jobs correctly. So, however much time it takes them to do this . . . they take their guaranteed hourly rate times the amount of time that it takes and they figure out what dollar amount that is of payment. Then you have your bucket sitting here of available funds that you could have earned provided you did everything correctly. If that’s more than your hourly rate, then you get that as a bonus. If it’s less than your hourly rate, then you just get your hourly rate.[4]

Defendant admits that during the relevant period, it has maintained a practice of deducting money from Installation Technicians’ compensation for tool purchases, customer complaints, quality-control problems, and for lost or damaged cable equipment. More specifically, Defendant charged Installation Technicians money under the following circumstances: (1) $50.00 deductions for failed Cox quality checks; (2) $25.00 deductions for failed in-house quality checks; (3) $50.00 deductions for exceeding three percent service-call return rates from the customer cable company; (4) $50.00 deductions for each customer complaint; (5) deductions for missing equipment; and (6) deductions for damage to customer property. However, Defendant asserts that its policy changed during the relevant period because in December 2010, it stopped making deductions for company-provided cellular phones.

Plaintiff Michael Knight was employed by Defendant from March 16, 2010, to August 27, 2010. Knight lived and worked predominantly in Kansas City, Missouri. During that time, Defendant deducted $686.68 from Knight’s paychecks for tool purchases, a pocket toner purchase, a dish reconnect fee after Knight severed a customer line, and five deductions for failed quality checks. At the conclusion of his employment, Defendant refunded $334.68 to Knight to reimburse him for some returned tools, but without any interest or penalties. On at least two occasions, Defendant deducted $50.00 from Knight’s wages for failed quality checks related to work that Knight performed in Kansas, for which Knight was charged Kansas sales tax.

Plaintiff Lynn Talbott worked as an Installation Technician for Defendant from June 2007 to November 2011. From June 2007 to December 2009, Talbott worked in Defendant’s Wichita office. Then, from December 2009 to November 2011, Talbott worked from Defendant’s office located in Kansas City, Missouri. Over the course of her employment, Talbott regularly performed installation work in Kansas. Defendant deducted Talbott’s pay on numerous instances for failed quality checks while she worked in Wichita and in Kansas City.

II. Analysis

A. Class Certification Under Rule 23

1. General Standards Governing Class Certification

Whether to certify a class is committed to the broad discretion of the trial court.[5] In exercising this discretion, the Court should err on the side of class certification because it has the authority to later redefine or even decertify the class if necessary.[6] In deciding whether to certify, the Court must perform a “rigorous analysis” as to whether the proposed class satisfies the requirements of Rule 23 of the Federal Rules of Civil Procedure.[7] Rule 23 does not provide the Court with the authority to conduct a preliminary inquiry into the merits of the lawsuit to determine whether it may be maintained as a class action.[8] The Tenth Circuit, however, has emphasized that the question of class certification involves considerations that are “enmeshed in the factual and legal issues comprising the plaintiff's cause of action.”[9] Although the Court may not evaluate the strength of a cause of action at the class certification stage, it must consider, “without passing judgment on whether plaintiffs will prevail on the merits, ” whether the requirements of Rule 23 are met.[10]

As the parties seeking class certification, Plaintiffs have the burden to demonstrate under a strict burden of proof that the requirements of Rule 23 are clearly satisfied.[11] In doing so, Plaintiffs must establish that the prerequisites of Rule 23(a) are satisfied and that the proposed class falls under one of the categories described in Rule 23(b).

2. Class Definition

In determining whether to certify a class, the Court first addresses the proposed class definition.[12] “Defining the class is of critical importance because it identifies the persons (1) entitled to relief, (2) bound by a final judgment, and (3) entitled under Rule 23(c)(2) to the best notice practicable in a Rule 23(b)(3) action.”[13] Therefore, the definition must be “precise, objective, and presently ascertainable.”[14] Here, Plaintiffs seek certification of the following class:

All Installation Technicians who worked for Mill-Tel, Inc., in Kansas at any time between March 29, 2006 to the present, whose wages were deducted as a result of performance deficiencies, damage to Mill-Tel property, loss of Mill-Tel property or for any other unlawful purpose.[15]

Defendant argues that the proposed class is both geographically and temporally overbroad, and therefore asks the ...


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