Seyfarth Synopsis: On June 11, 2019, in an age discrimination lawsuit, the U.S. District Court for the Eastern District of Tennessee once again demonstrated how the lenient standard that is so often applied at the conditional certification stage of a collective action brought under the procedural rules of the Fair Labor Standards Act. In Manlove v. Volkswagen Aktiengesellschaft, No. 18-CV-145 (E.D. Tenn. June 11, 2019), the Court granted conditional certification on the basis of just four declarations, even though those declarations identified four different methods of alleged age discrimination that were perpetrated by different decision-makers.
In Manlove, an assistant manager in the Chattanooga, Tennessee Volkswagen assembly plant sought conditional certification of his claim under the Age Discrimination in Employment Act of 1967 (“ADEA”) on behalf of a putative collective action of all Volkswagen employees in the United States aged fifty and over – which, if certified in full, would have included thirty-five different locations in more than fourteen states.
Plaintiff alleged that employees over the age of 50 were unfairly targeted and discriminated against as part of a corporate initiative that was allegedly designed to make the company “slimmer, leaner and younger.” That initiative – called the “Pact” – was announced on November 18, 2016 and involved the elimination of 30,000 jobs in Germany and around the world. On June 26, 2017, the Company issued a press release stating, among other things, that the Pact would provide “new motivation” and a new selection procedure for junior managers. Two senior executives with authority over human-resources decisions were transferred to Chattanooga, Tennessee.
Plaintiff alleged that the Company began to take discriminatory action against older employees shortly after the Pact was announced. Plaintiff alleged that he was passed over for promotion by younger managers, and that he and another older employee were demoted after the Company restructured his department to eliminate two out of five manager positions.
Plaintiff also submitted declarations from three other over-50 employees at the Chattanooga plant. One alleged that she was abruptly terminated for violating a company policy and was immediately replaced by a much younger employee. Another alleged that he was selected for promotion to a manager position, but then told that he was too old to be included in the Company’s management training program and that he was subsequently terminated. A third declarant alleged that he was continually passed over for promotion in favor of younger employees with less relevant experience. He was then terminated after he failed a random drug test.
The Court’s Decision
The employer argued that these four declarations were not enough to support conditional certification because they failed to establish that the members of the putative collective action were similarly situated. According to the employer, the declarations involved four discrete employment circumstances, which demonstrated no common unifying nexus of alleged discrimination.
The Court disagreed, holding that conditional certification is appropriate upon a modest factual showing of a unified employment policy that ties together the claims of all putative members of the collective action. The Court held that plaintiff had adequately alleged such a policy by identifying and describing the basic parameters of the Pact, as well as some related statements by the company’s CEO that “arguably indicate a preference for younger employees.” Id. at 13. The Court also pointed to the fact that the Company had transferred two high-level executives to Chattanooga and had given them authority over human resources decisions, including termination decisions.
With respect to the declarations, the Court held that they constituted sufficient evidence to show that adverse employment actions were taken on the basis of age against employees in Chattanooga, even though “the exact methods of discrimination, as well as the decision-makers involved, may well vary among the putative collective action members.” Id. at 14. The Court held that the employer would have an opportunity to demonstrate differences among members of the collective action and argue for decertification at the more rigorous second stage of the certification process.
In one positive note for the defense, the Court refused to expand the conditionally certified collective action beyond the Chattanooga location, holding that plaintiff had presented no evidence of any adverse actions taken at other locations.
Implications For Employers
This ruling demonstrates once again – as if more proof were needed – how easy it can be for employees to obtain conditional certification of a collective action under the two-stage certification scheme commonly applied to claims that arise under the procedures of the Fair Labor Standards Act (including ADEA and Equal Pay Act claims). Even more telling, the Court certified the collective action while candidly acknowledging the impact the decision would have on the defense. The employer had requested oral argument, pointing to the impact that conditional certification could have on the scope of discovery and the resources required to defend the lawsuit. The Court dismissed those concerns, stating that it was “no different than any other decision the Court will ever make about whether to conditionally certify a collective action.”