Second Circuit Affirms Dismissal Of Overtime Lawsuit Where Complaint Fails To Allege Extra Hours Worked

Howard Sokol is a Partner in our New York office

The most recent of three similar decisions from the U.S. Court of Appeals for the Second Circuit may limit the risk employers face from overtime lawsuits brought under the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL). On Aug. 5, 2013, in Dejesus v. HF Mgmt. Servs., LLC, a/k/a Healthfirst, the court affirmed the dismissal of an FLSA and NYLL overtime lawsuit because the plaintiff failed "to plausibly allege she worked more than 40 hours in a given week and was not paid overtime wages." Although the court recognized that plaintiffs may lack access to the employer's records regarding the plaintiff's exact pay and hours worked, a complaint must at least approximate the number of overtime hours allegedly worked and for which the plaintiff was not compensated. Simply alleging that the plaintiff worked more than 40 hours in certain weeks and was not compensated will not be enough to stay in court.

Employers Benefit from the Decision

This decision makes it less likely that employers will face FLSA and NYLL complaints filed simply as "fishing expeditions" in the hope of finding an overtime violation through discovery or to hold the employer up for a nuisance settlement. It also shows that a plaintiff, who decides not to amend a "bare bones" complaint to add more factual detail — rather than appealing an adverse decision, risks being thrown out of court permanently.

Employment Facts and Complaint's Allegations

Ramona Dejesus was employed by HF Management Services, LLC ("Healthfirst") in New York City as a promoter of its insurance programs and services. Dejesus sued Healthfirst in March 2012, alleging that she was an employee owed overtime wages by the company for the three years prior to April 2011, under both the FLSA and the NYLL. In her complaint, Dejesus alleged, among other facts, that:

She worked more than 40 hours per week, the threshold for overtime under both federal and New York law, during "some or all weeks" during the period at issue. She was not paid the rate of 1.5 times her regular wage for each extra hour over 40 in any given week. She was not paid for commissions earned and owed to her at the time her employment ended with Healthfirst. The company "breached the employment agreement/contract" by not paying her the wages she was allegedly owed, although she never attached the alleged contract between her and Healthfirst or, for that matter, describe any of its...