Legal Blog

Recent Supreme Court Decision Puts Employers at More Risk for Class Action Lawsuits

On March 22, 2016, the United States Supreme Court determined that courts can use statistical estimates when establishing liability in class-action cases against companies. A class action lawsuit when a group of people with similar complaints sue the defendant as a group. In this specific case, Tyson Foods, Inc. v. Bouaphakeo, former and current employees of Tysons Food, Inc. filed a class action lawsuit against the company.  The employees claimed that they were not properly paid for time spent “donning and doffing”, or putting on and taking off uniforms and/or gear necessary to perform their job duties. The employees argued that representative evidence and an estimate of time not paid was sufficient to establish Tysons Food, Inc.’s liability on behalf of all 3,344 employee class members.  While Tysons Food, Inc. agreed that the employees were not paid for the time they spent donning and doffing, it argued that the provided representative evidence was not sufficient because it would require person-specific inquiries to accurately determine the wages owed.  For example, Tysons Food, Inc. pointed out that some of the class members did not incur any loss of wages for donning and doffing, so it was inappropriate to use a statistical estimate on a class-wide basis. The Supreme Court ruled in favor of the employees and determined that a class action under Federal Rule of Civil Procedure 23(b)(3) (and similarly a collective action under the Fair Labor Standards Act) may be certified even if liability and damages must be established with statistical techniques that presume all class members are identical to the average observed in a sample.  The Supreme Court also held that a class (and collective) action may be maintained even if the class contains many employees who were not injured and have no legal right to damages.

What does this decision mean for employers?

Employers defending class actions may no longer be able to defeat class action lawsuits by pointing out differences amongst the class.  In fact, employees in class actions may still recover big even if some of the class members have no damages.  This decision will likely bolster wage and hour class action lawsuits, which have significantly increased in number every year since 2012.    This decision only affirms how important it is for companies – of all sizes – to ensure that they are classifying their employees correctly and complying with the wage and hour laws.  It only takes one disgruntled current or former employee for employers to find themselves defending costly class/collective actions.



If you have any questions on this topic, contact an attorney here.



Offit Kurman is one of the fastest-growing, full-service law firms in the Mid-Atlantic region. With 120 attorneys offering a comprehensive range of services in virtually every legal category, the firm is well positioned to meet the needs of dynamic businesses and the people who own and operate them. Our eight offices serve individual and corporate clients in the Maryland, Delaware, New Jersey, and Northern Virginia markets, as well as the Washington DC, Baltimore, Philadelphia, and New York City metropolitan areas. At Offit Kurman, we are our clients’ most trusted legal advisors, professionals who help maximize and protect business value and personal wealth. In every interaction, we consistently maintain our clients’ confidence by remaining focused on furthering their objectives and achieving their goals in an efficient manner. Trust, knowledge, confidence—in a partner, that’s perfect. You can connect with Offit Kurman via our BlogFacebookTwitterGoogle+YouTube, and LinkedIn pages.  You can also sign up to received Law Matters, Offit Kurman’s monthly newsletter covering a diverse selection of legal and corporate thought leadership content.