United States District Court, E.D. North Carolina, Western Division
C. DEVER, III UNITED STATES DISTRICT JUDGE
17, 2018, Laura Pontones ("Pontones" or
"plaintiff'), on behalf of herself and similarly
situated plaintiffs, filed a complaint against a group of
allegedly related Mexican restaurants for violations of the
Fair Labor Standards Act, 29 U.S.C. § 201, et seq.
("FLSA"), and the North Carolina Wage and Hour Act,
N.C. Gen. Stat. § 95-25.1, et seq. ("NCWHA")
[D.E. 1]. On June 11, 2018, Pontones amended her complaint
[D.E. 7]. On April 26, 2019, Pontones moved for conditional
class certification under section 216(b) of the FLSA and Rule
23 of the Federal Rules of Civil Procedure [D.E. 66] and
filed a memorandum in support [D.E. 67]. On May 17, 2019,
defendants responded in opposition [D.E. 68] and filed
various exhibits [D.E. 69, 70]. On June 5, 2019, Pontones
replied [D.E. 75] and filed additional declarations [D.E. 73,
74]. As explained below, the court grants Pontones's
motion for conditional class certification concerning both
is a former server. See Am. Compl. [D.E. 7] ¶ 1, 14. She
sues San Jose Restaurant Incorporated; San Jose Management,
Inc., d/b/a San Jose Mexican Restaurant and Sports Cantina;
San Jose Mexican Restaurant #2 of Lumberton, Inc.; San Jose
Mexican Restaurant of Elizabethtown, Inc.; San Jose Mexican
Restaurant of N.C. Inc.; San Jose Mexican Restaurant of
Pembroke, NC, Inc.; San Jose Mexican Restaurant of Raleigh
Inc.; San Jose Mexican Restaurant of Shallotte, Inc.; San
Jose of Rocky Mount #2 Inc., d/b/a San Jose Tacos and
Tequila; San Jose of Zebulon, Inc.; San Jose of Roanoke
Rapids, Inc.; San Jose Wakefield, Inc., d/b/a San Jose Mex
and Tequila Bar; Plaza Azteca Raleigh, Inc., d/b/a San Jose
Tacos and Tequila; Hector Flores; Alberto Flores; Josue
Flores; Jose Perez; Vicente Perez; Pablo Meza; Edgardo
Flores; and Edgar Flores (collectively,
"defendants") for unpaid minimum wages and overtime
compensation. See id.
own and operate Mexican restaurants in North Carolina,
Virginia, and South Carolina. See Id. ¶ 46.
From about October 2, 2016, to January 22, 2017, Pontones
worked as a server at the Brier Creek location in Raleigh,
North Carolina. See Id. ¶ 47. From January 23,
2017, until April 2017 and again from July 2017 to August
2017, Pontones worked at the Triangle Town Center Mall
location in Raleigh, North Carolina. See Id.
Pontones did not supervise other employees and performed the
normal duties of a server. See Id. ¶¶
48-50. She worked Wednesday to Sunday. See Id.
¶ 51. On Wednesdays and Thursdays, Pontones worked from
10 am. to 10 p.m. See Id. On Fridays and
Saturdays, Pontones worked from 10 am. to 11 p.m. See
Id. On Sundays, she worked from 5 p.m. to 10 p.m.
See Id. Each work day except Sunday, Pontones would
take a two-hour unpaid break between shifts. See Id.
Pontones alleges that defendants controlled her work schedule
and rate of pay. See Id. ¶ 52.
to Pontones, she and others similarly situated "were
advised" that they would be paid an hourly wage less
than the minimum wage required under FLSA, plus tips. See
Id. ¶ 53. But Pontones only received a check
for her first week of training (at $8.00 per hour) and
"one to two" checks for $0.00. See Id.
Otherwise, Pontones alleges that she did not receive wages or
check stubs that documented the hours she worked or the wages
she earned. See Id. Pontones also claims that the
defendants deducted a fixed percentage of all credit and cash
purchases made by customers from her earnings, usually about
3%, regardless of whether a customer paid in cash or by card.
See Id. ¶¶ 54-55, 57. She alleges that
defendants used this deduction to pay their operating
expenses. See Id. ¶ 56. She also alleges that
defendants did not operate a tip pool. See id.
2014 until 2016, the United States Department of Labor, Wage
and Hour Division, investigated defendants and found
"numerous violations," including failure to pay
overtime pay, failing to pay minimum wage by
requiring waiters to work for tips alone, failing to maintain
required time and payroll records, and falsifying payroll
documents. See Id. ¶ 59. Pontones alleges that
the defendants continued their practices after the federal
investigation. See Id. ¶ 60. In 2006 and 2007,
and again from late 2017 until early 2018, the North Carolina
Department of Labor also investigated defendants. See
Id. ¶ 61. The first investigation did not
result in any findings because defendants did not comply.
See id. The second investigation resulted in the
assessment of civil penalties. See id.
provides evidence of the U.S. Department of Labor's
investigations. See Ex. A [D.E. 67-1]. These investigations
resulted in the assessment of significant back-wages against
the San Jose restaurants owed to approximately 125 employees.
See Id. at 167-69; Flores Dep. [D.E. 67-2] 14. Some
of these employees were servers. See Flores Dep. [D.E. 67-2]
March 10, 2016, a group of plaintiffs filed a collective
action under FLSA in this court against defendants. See
Galvan v. San Jose Mexican Rest, of NC. Inc., No.
7:16-CV-39-FL, 2016 WL 6205783, at *1 (E.D. N.C. Oct. 24,
2016) (unpublished). The GaWan plaintiffs alleged mirroring
FLSA claims, but did not allege any state law claims. See
id. On October 24, 2016, Judge Flanagan granted
plaintiffs' motion for conditional class certification
under section 216(b) of the FLSA. See id. at*3. On
March 2, 2018, the parties settled the litigation. See
Galvan v. San Jose Mexican Rest, of N.C., Inc., No.
7:16-CV-39-FL, [D.E. 46] (E.D. N.C. Mar. 2, 2018). Pontones
claims that defendants continued their unlawful wage
practices after the settlement See Am. Compl. [D.E.
submits Hector Flores's deposition of December 18, 2018.
Flores testified that the individual store managers
essentially operate the different San Jose locations without
much if any oversight from the owners. See Flores Dep. [D.E.
67-2] 12-13. He also admitted that the Department of Labor
found that the San Jose restaurants had failed to pay servers
anything besides tips, which resulted in minimum wage and
overtime violations like those that Pontones alleges. See
Id. at 15. Flores, however, did not know what
policies and practices existed at the restaurants. See
Id. at 27, 29, 37-38. Flores also testified that he
personally had done nothing to remedy the violations at the
San Jose restaurants and that the managers were responsible
for bringing the restaurants into compliance after the
Department of Labor's investigations. See Id. at
Pontones seeks to bring a collective action under section
216(b) of FLSA for:
All current and/or former servers of Defendants whose primary
duty is/was non-exempt work, who were not paid
minimum wage and/or overtime, and who are/were
subjected to deductions of a fixed percentage of all credit
and cash purchases made by Defendants' customers., within
the three (3) year period prior to joining this lawsuit under
29 U.S.C. § 216(b).
Compl. [D.E. 1] ¶ 65(a). Pontones alleges that
defendants did not pay the putative members of the FLSA
collective action the legally required minimum wage or
overtime rate of time and that defendants took deductions
from their salaries improperly. See Id. ¶ 66;
Pontones Decl. [D.E. 73] ¶ 1 (naming specific
individuals with whom Pontones worked). Pontones also offers
evidence that these policies applied to servers at other
locations. See Enriquez Decl. [D.E. 74] ¶¶
also seeks to certify a class action under Rule 23 of the
Federal Rules of Civil Procedure on behalf of the following
All current and/or former employees of Defendants in North
Carolina whose primary duty is/was non-exempt work, who
are/were not paid for all of their hours worked, including
promised regular and/or overtime wages, and who are/were
subjected to unlawful deductions of a fixed percentage of all
credit and cash purchases made by Defendants' customers,
at any time within the two (2) year period prior to the
filing of this lawsuit.
Compl. [D.E. 1] ¶ 73(a).
FLSA requires employers to pay non-exempt employees a minimum
wage and overtime wage. See 29 U.S.C. §§ 206-07;
Desmond v. PNGI Charles Town Gaming.
L.L.C.,630 F.3d 351, 356-57 (4th Cir. 2011): Romero
v. H.B. Auto. Grp., Inc., No. 11 Civ. 386(CM), 2012 WL
1514810, at *5-7(S.D.N.Y. May 1, 2012) (unpublished). Under
the FLSA, employees can bring suit on behalf of themselves
and other similarly situated employees against employers for
unpaid overtime and other claims. See 29 U.S.C. §
216(b). This collective action process enables similarly
situated employees to pool resources and promote judicial
efficiency. See, e.g., Jackson v. Bloomberg. L.P.,
298 F.RD. 152, 158 (S.D.N.Y. 2014); Faust v. Comcast
Cable Commc'ns Mgmt., LLC., No. WMN-10-2336, 2011 WL
5244421, at *2 (D. Md. Nov. 1, 2011) (unpublished). The FLSA
is a special form of collective action, separate from class
actions under Rule 23 of the Federal Rules of Civil
Procedure. See 29 U.S.C. § 216(b). For example, unlike
class actions under Rule 23(b)(3), in which class members are
bound by the judgment unless they opt out of the class,
collective FLSA actions require plaintiffs to give
"consent in writing to become such a party."
Id. Thus, FLSA collective-action plaintiffs must be
"similarly situated" ...