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Barbosa v. National Beef Packing Company, LLC

United States District Court, D. Kansas

October 10, 2014

VALENTE SANDOVAL BARBOSA and CAROLINA GAYTAN, on behalf of themselves and all others similarly situated, Plaintiffs,
v.
NATIONAL BEEF PACKING COMPANY, LLC, Defendant.

MEMORANDUM AND ORDER

KATHRYN H. VRATIL, District Judge.

Valente Sandoval Barbosa and Carolina Gaytan, on behalf of themselves and others similarly situated, bring suit against National Beef Packing Company, LLC, seeking unpaid straight time, overtime premiums and related penalties and damages under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq. This matter is before the Court on the parties' Joint Motion For Approval Of Fair Labor Standards Act Collective Action Settlement (Doc. #55) and plaintiffs' Unopposed Motion For Approval Of Attorneys' Fees And Costs (Doc. #56), both filed October 14, 2013. For the reasons stated below, the Court overrules the motions.

I. Factual Background

A. Lawsuit And Claims

Defendant operates a beef slaughtering and processing plant in Liberal, Kansas which employs more than 2, 000 hourly employees. See Complaint (Doc. #1) filed May 21, 2012 ¶¶ 3-4; Joint Motion For Approval Of Fair Labor Standards Act Collective Action Settlement ("Joint Motion") (Doc. #55) at 2. Defendant requires hourly production employees to use an electronic security card, or "ID badge." Barbosa Aff. ¶ 6, Ex. 1 to Plaintiffs' Memorandum In Support Of Plaintiffs' Motion For Conditional Certification Of Class Claims Under § 216(b) Of The FLSA ("Plaintiffs' Memorandum") (Doc. #10) filed July 23, 2012; Gaytan Aff. ¶ 6, Ex. 2 to Plaintiffs' Memorandum (Doc. #10). Upon arriving at work each day, employees must swipe their ID badges to enter the plant's security gate. Barbosa Aff. ¶ 6, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶ 6, Ex. 2 to Plaintiffs' Memorandum (Doc. #10). After entering the plant, they again swipe the badges to clock in and out of their shifts. Barbosa Aff. ¶¶ 7-8, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶¶ 7-8, Ex. 2 to Plaintiffs' Memorandum (Doc. #10).

Defendant does not use the badges to record compensable wages. Barbosa Aff. ¶ 9, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶ 9, Ex. 2 to Plaintiffs' Memorandum (Doc. #10). Instead, defendant uses a "gang time" system, which pays hourly production employees only for the time that they work on a running production line. Barbosa Aff. ¶¶ 10-11, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶¶ 10-11, Ex. 2 to Plaintiffs' Memorandum (Doc. #10). Defendant does not compensate hourly production employees for time spent at the plant but away from their respective production lines, or for time spent at the production line when it is not moving and producing product. Barbosa Aff. ¶¶ 10-11, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶¶ 10-11, Ex. 2 to Plaintiffs' Memorandum (Doc. #10). Defendant pays some hourly production employees for additional time, up to nine minutes, known as donning and doffing pay. Barbosa Aff. ¶ 12, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶ 12, Ex. 2 to Plaintiffs' Memorandum (Doc. #10).

Under the "gang time" system, regardless whether they receive donning and doffing pay, hourly production employees typically spend uncompensated time before, during and after each shift performing - and waiting in line to perform - various tasks. Barbosa Aff. ¶ 13, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶ 13, Ex. 2 to Plaintiffs' Memorandum (Doc. #10). The daily tasks which hourly production employees typically perform without pay include (1) pre-shift waiting in line to receive and/or to sanitize equipment; (2) pre-shift sanitizing equipment; (3) pre-shift walking from the locker room to sanitization stations and to assigned work stations; (4) doffing protective gear during unpaid lunch breaks; (5) waiting in line to receive and receiving sanitary equipment during unpaid lunch breaks; (6) waiting in line to sanitize equipment and sanitizing equipment during unpaid lunch breaks; (7) re-donning protective gear during unpaid lunch breaks; (8) processing meat on the production line after the line has stopped running at the end of the shift; (9) post-shift waiting in line to sanitize equipment and sanitizing equipment; (10) post-shift waiting in line for inspection of sanitized equipment; (11) post-shift waiting in line to receive protective equipment for the next shift; and (12) post-shift walking from the production floor to sanitization stations and to the locker room. Barbosa Aff. ¶ 14, Ex. 1 to Plaintiffs' Memorandum (Doc. #10); Gaytan Aff. ¶ 14, Ex. 2 to Plaintiffs' Memorandum (Doc. #10).

On May 21, 2012, plaintiffs Valente Sandoval Barbosa and Carolina Gaytan filed putative collective action claims for alleged violations of the FLSA. See Complaint (Doc. #1). Plaintiffs assert that defendant's gang time compensation system fails to fully compensate hourly production workers for all hours worked. See Joint Motion (Doc. #55) at 11. Under the FLSA, plaintiffs seek damages for straight-time and overtime compensation and liquidated damages for time spent performing uncompensated tasks. See Complaint (Doc. #1) at 7 ¶¶ a, c. Plaintiffs also seek attorneys' fees, expert fees and other costs and expenses. Id. at 7 ¶ d. Plaintiffs do not seek recovery for the time spent donning and doffing protective equipment, but they assert that these activities serve as principal activities under Section 203(c) of the FLSA, i.e., that they serve as the "bookends" of the continuous workday such that all activity occurring between the bookends is compensable. See Joint Motion For Approval Of Fair Labor Standards Act Collective Action Settlement (Doc. #55) at 4.

B. Conditional Class Certification And Notice

On July 23, 2012, plaintiffs filed their Motion For Conditional Certification Of Class Claims Under § 216(b) Of The FLSA (Doc. #9). In support, plaintiffs submitted nearly identical affidavits. The affidavits stated that from April of 2010 until filing the motion on July 23, 2012, Barbosa worked as an hourly production employee. Barbosa Aff. ¶ 1, Ex. 1 to Plaintiffs' Memorandum (Doc. #10). From March of 2000 to December of 2010, Gaytan worked as an hourly production employee. Gaytan Aff. ¶ 1, Ex. 2 to Plaintiffs' Memorandum (Doc. #10).

On January 31, 2013, the Court sustained plaintiffs' motion in part. See Memorandum and Order (Doc. #21) at 10-11. The Court conditionally certified a class of "all hourly production employees who have been subject to defendant's gang time' compensation practices at defendant's facility in Liberal, Kansas, for the period of three years prior to [January 31, 2013]." Id. at 10. The Court also approved Barbosa and Gaytan as class representatives and appointed plaintiffs' counsel, Mark A. Kistler and Michael F. Brady of Brady & Associates Law Office, to serve as counsel for the conditional class. See id. at 10. The Court ordered conditions about notice to putative class members, and 480 eligible plaintiffs opted in to the litigation.[1] See id.; Joint Motion (Doc. #55) at 4.

C. Settlement

The parties participated in mediation on July 10, 2013, and thereafter they agreed to settle. Under the terms of the settlement, National Beef will pay a total of no more than $350, 000, which the parties assert is to be allocated as follows:

$201, 680 available to the 480 collective action members;
$100, 320 for attorneys' fees;
$41, 000 for litigation costs;[2]
$3, 500 service payment to plaintiff Barbosa; and
$3, 500 service payment to plaintiff Gaytan.

Unopposed Motion For Approval Of Attorneys' Fees and Costs (Doc. #56) at 7; Settlement Agreement ¶ 3(a) & (c), Ex. A to Joint Motion (Doc. #55).

1. Allocation Calculation Among Plaintiffs

The settlement agreement defines opt-in plaintiffs as "all eligible current and former hourly production employees who work or worked in National Beef's Liberal, Kansas facility... who opted-into th[is] litigation." Settlement Agreement at 1, Ex. A to Joint Motion (Doc. #55). Under the settlement agreement,

Each Opt-In Plaintiff shall be allocated (a) a minimum payment based upon one week worked in a Gang Time Position without donning and doffing pay or (b) a share of the Total Settlement Amount ("Share"). Each Opt-In Plaintiff's Share shall be calculated according to the following formula agreed upon by the parties: Opt-In Plaintiff Share Numerator: combined point total for number of weeks worked in a Gang Time position during the three-year period preceding the date that the Opt-In Plaintiff's consent form was filed with the Court through July 10, 2013 ("Combined Opt-In Points"). Opt-In Plaintiff shall receive one point for each week worked in a Gang Time position that did not receive an additional nine minutes of donning and doffing pay ("Non-DD Pay Position") and 1.5 points for each week worked in a Gang Time position that received an additional nine minutes of donning and doffing pay ("DD Pay Position"). All Opt-Ins [sic] Plaintiffs' [sic] shall receive a minimum of one Opt-In Point.
Opt-In Plaintiff Share Denominator: total number of Opt-In Points by all Opt-In Plaintiffs who worked as hourly production employees in Gang Time positions.
Opt-In Plaintiff Share Distribution Percentage: Opt-In Plaintiff Share Numerator divided by Opt-In Plaintiff Share Denominator.
Opt-In Plaintiff Share Payment: Share Distribution Percentage multiplied by the Total Settlement Amount minus Court-approved attorneys' fees and costs; Court-approved service awards (as specified above). Opt-In Plaintiff Share ...

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