Wage & Hour Defense Blog : Wage & Hour Lawyer & Attorney : Epstein Becker Green Law Firm : DOL Enforcement, FLSA Coverage

Florida led the nation in Fair Labor Standards Act lawsuits in 2009. Statistics generated from PACER (Public Access to Court Electronic Records) show that about 2000 new cases were filed in United States District Courts in Florida last year, far more than in any other state. 

Of course, Florida is not the only hotbed of wage-hour litigation. California, which has its own, more rigorous wage-hour laws, has a large number of wage-hour cases filed in its state court system. Texas and New York are also seeing increasing numbers of wage-hour cases.

But when it comes to the FLSA, the Sunshine State rules. The reasons for this are somewhat mysterious. Are Florida employees more litigious than in other states? Do Florida employers violate the FLSA more often? Is there a more active plaintiff-side employment bar in Florida? I suspect the answer is a combination of all these factors, plus good old-fashioned word of mouth. Here’s what I mean: the vast majority of FLSA cases settle before trial. FLSA settlements generally must be approved by a court, see Lynn's Food Stores, Inc. v. United States, 679 F.2d 1350 (11th Cir. 1982), and many judges refuse to allow FLSA settlements to be confidential. And even if the terms of a settlement are confidential, a settling plaintiff can always disclose that the case has been “resolved amicably,” or words to that effect. Whatever the exact words, the message is clear – the plaintiff got a nice check. It’s like that old shampoo commercial from the 70’s: a settling plaintiff tells two friends, and they tell two friends, and so on and so on… Pretty soon you have 2000 FLSA cases on the docket.

So what can a Florida employer do to avoid being named in an FLSA lawsuit? Well, the best advice I can offer is to make every reasonable effort to comply with FLSA. That may seem obvious, but it’s not as easy as it sounds because the FLSA can be counterintuitive; its rules are often inconsistent with what seem to be reasonable and ethical business practices. But if you learn what the FLSA requires, and adopt policies and practices that are consistent with the law, you will go a long way toward avoiding a lawsuit. And, yes, get the advice of a qualified employment lawyer if you are unsure about what to do. Believe me, it will be far less expensive than litigation.

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Last month I reported that United States District Judge Kenneth L. Ryskamp had sanctioned the Shavitz Law Group, one of the leading plaintiff-side wage-hour firms in Florida, for soliciting plaintiffs in violation of Florida Bar Rules.  The case was Hamm v. TBC Corp. and Tire Kingdom, Inc., Case No. 07-80829-CIV-RYSKAMP/VITUNAC. 

The Shavitz firm recently struck back, filing a motion to disqualify or recuse Judge Ryskamp from presiding over a different case, a Fair Labor Standards Act collective action against Abercrombie & Fitch.  The motion quoted Judge Ryskamp's comments during a hearing in the Hamm case:

I have had our law clerk check and the Shavitz firm has filed 1,332 cases in the Southern District of Florida since 2000, so we see these things continually, virtually never see them go to trial, I think that I have had one trial with all the cases that have been filed.

In looking at the statistical numbers, they are usually closed within three months of the time they are filed, so what is very clear to me is that most defendants are saying how much is it going to cost me to defend this case and what is the claim and the claim is so small it would cost most to have the lawyers defend it, so they are basically nuisance type claims that get bought off, of course the lawyer’s fees are always – not always, but very often considerably more than the claim itself – and I think this is certainly an area for some Congressional oversight, I think there ought to be written into the statute a provision that a letter demand must be made upon the employer before a lawsuit can be filed because the way this thing is working is just a lawyer’s retirement bill. . . . this has gotten out of hand, I think we have more of these cases in the Southern District of Florida than there are anyplace else in the country and that’s probably because of the Shavitz law firm. . . . I think the problem needs to be resolved.

The Shavitz firm argued that these comments, and others that Judge Ryskamp has made about the Shavitz firm, demonstrate "an apparent bias or prejudice against Plaintiff and Plaintiff’s counsel, such that disqualification/recusal is mandatory."

Three days later, Judge Ryskamp issued an order recusing himself from the case. 

Judge Ryskamp's recusal notwithstanding, from my perspective as a defense attorney, his comments were on the money. Many, if not most, FLSA cases are settled on a nuisance value basis.  In such cases, there is often only a few thousand dollars of overtime pay at issue.  And the employer often has solid defenses which it could prove on summary judgment or at trial.  But after some frank discussions with defense counsel, the employer concludes that it makes more sense to settle the case for, say, $10,000 than to pay its own attorneys $50,000 to $100,000 to litigate the case.  An additional factor is the uncertainty of litigation:  if the employee proves liability, even for a small amount, the employer will be on the hook for the plaintiff's attorney's fees as well.  So these cases typically settle, and Shavitz (or one of his colleagues in the plaintiffs' bar) move on to their next case.  The cycle continues, and South Florida continues to lead the nation in wage-hour lawsuits.   

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