California Appellate Court Reverses Denial of Certification

California’s Court of Appeal has reversed a trial court’s denial of a motion to certify claims alleging underpayment of earned overtime pay and miscalculation of pay rates. See Bowers Cos. Wage & Hour Cases, No. G046104 (Cal. Ct. App. June 27, 2013) (available here). The defendant conceded that the policies were as the plaintiff alleged, and as a result, the court found that common questions necessarily predominated and the claims should – indeed must – be adjudicated in a class action. The Fourth Appellate District remanded the case to the trial court with the directive to grant the plaintiff’s class certification motion consistent with the subclass definitions as revised by the unanimous three-judge appellate panel. Slip op. at 1-2.

The defendant, an ambulance company, employed the named plaintiffs as EMTs and pursuant to an alternative work schedule (AWS) paid the plaintiffs and their fellow workers overtime after they worked ten hours in a day, rather than after the usual eight hours. Slip op. at 5, 7. While California law provides for certain changes to overtime pay under a properly adopted AWS system, the plaintiffs here alleged that the defendant’s formulas for setting both regular and overtime pay rates did not comply with the applicable California AWS law. Id.

The Court of Appeal found that the trial court committed reversible error in multiple respects. First, the trial court based its denial of certification on a proposed regular rate subclass not being ascertainable, but “failed to consider whether the class definition could be modified” to resolve any ascertainability deficiency. Slip op. at 17. Connecting the ascertainability analysis to the defendant’s admittedly uniform pay-rate calculation policy, the Court of Appeal underscored a hard rule of class action jurisprudence with the observation that where there is “a theory of recovery challenging an undisputed policy uniformly applied to a readily identifiable group of employees” the proposed class or subclass is ascertainable as a matter of law. Slip op. at 18.

After dealing with the ascertainability issue, the Court of Appeal turned to the trial court’s finding that the plaintiffs hadn’t satisfied the numerosity requirement, and concluded that the modest numerosity threshold had been amply satisfied. Slip op. at 18-21.

Finally, as to the often-pivotal issue of whether common issues of law or fact predominate, the panel concluded that “Plaintiffs’ theory challenges the uniform policy Defendants applied to all class members and whether that policy violates California law is a question eminently suited for class treatment. The policy’s existence and terms may be established at trial through Defendants’ testimony and documents without any individualized evidence.” Slip op. at 23.

Though the decision has been designated as unpublished, it is likely to spark calls for that designation to be changed to published under the California Rules of Court insofar as it provides a clear, well-reasoned, and detailed statement of law concerning a much-repeated circumstance.