Appellate Court Reverses Denial of Class Certification
In an unfortunate case for employers, the Second Appellate District, Division One, reversed a trial court’s denial of a motion for class certification in Jaimez v. Daiohs USA, Inc., an exemption and meal and rest break case.
In this case, the proposed class representative worked as a Route Sales Representative (“RSR”) for Daiohs First Choice Services (“First Choice”). RSRs spent almost all of their workday on the road or at customers’ locations, delivering, servicing, and up-selling bottled water products or coffee products. In the 2003 to 2004 time frame, First Choice reclassified most of the RSR positions to non-exempt, and by October 2007, all RSR had been reclassified. In mid-2007, however, Jaimez filed a putative class action, alleging that the RSRs had been misclassified, that they had been denied meal and rest breaks, and related claims.
Jaimez moved for class certification, submitting 9 putative class member declarations (including his own) in support. First Choice opposed the motion with 25 putative class member declarations, all of whom were current employees. The trial court denied class certification, without prejudice, finding that Jaimez’s claims were not typical of the proposed class as demonstrated by First Choice’s declarations, that commonality was lacking because First Choice’s evidence demonstrated a “strong indication of conflicting testimony” at trial, and that because of the need for individualized inquiry, a class action was not the superior method for resolving the dispute. The trial court also found that Jaimez was not an adequate class representative because of his deposition testimony, including the fact that he lied on his employment application by failing to disclose his felony conviction.
The Court of Appeal reversed, holding that the trial court “misapplied the criteria” for class certification by focusing on the potential conflicting issues of fact or law on an individual basis instead of determining whether the “theory of recovery” advanced by the plaintiff was likely to be amenable to class treatment.
The appellate court found that plaintiff submitted evidence that First Choice had uniform corporate practices applicable to the class claims, which were that RSRs performed the same duties every day; First Choice failed to properly pay overtime even after RSRs were reclassified; First Choice created delivery schedules which it pressured RSRs to complete in 8 hours, making it difficult to take meal and rest breaks; and First Choice failed to compensate RSRs for missed, late or interrupted breaks. Regarding meal breaks, the Court of Appeal noted that the issue of what it means to “provide” meal breaks is pending before the California Supreme Court, but determined that there were common factual issues of whether First Choice had a practice of requiring RSRs to sign a manifest stating that they took a meal break in order to receive their paycheck and of First Choice’s pre-2006 practice of deducting 30 minutes per shift regardless of whether the RSR actually took a 30-minute meal break.
Based on these facts, the appellate court found that the plaintiff’s theory of recovery focused on uniform policies and practices applicable to the class, and was therefore more amenable to class treatment than individual disposition. The Court of Appeal determined that the trial court improperly focused on the “merits of the declarations, evaluating the contradictions in the [declarants’] responses to the company’s uniform policies and practices, not the policies and practices themselves.” The Court of Appeal concluded that had the trial court focused on the plaintiff’s theory of recovery, “it would have necessarily found the First Choice declarations, while identifying individual effects of policies and practices that may well call for individual damages determinations, nevertheless confirm the predominance of common legal and factual issues that make this case more amenable to class treatment.” The Court of Appeal reversed the denial of class certification, except for the finding that Jaimez was not an adequate class representative, and directed the trial court to certify the case upon the court’s approval of a new class representative.
The Jaimez decision is here.