On October 30, 2013 the U.S. Chamber of Commerce issued a Report entitled “The New Lawsuit Ecosystem: Trends, Targets and Players” that “examines the developing lawsuit “ecosystem.” The Report is broken down into six distinct litigation areas and “offers insights into new emerging liability threats, and explores the growing alliance between state attorneys general and the plaintiffs’ bar.” While the entire 164 page report is worth a read, the sections on employment-related class action litigation are especially relevant to the loyal readers of the Workplace Class Action Blog, as well as Seyfarth’s Wage and Hour Litigation Blog.
With respect to Class Action Litigation, the Report notes how several recent Supreme Court decisions, including Comcast v. Behrend and American Express Co. v. Italian Colors Restaurant “have improved the landscape for American businesses when it comes to defending class actions.” Id. at 9-10. The Report also analyzes how, “some courts have not heard the Supreme Court’s message about closer scrutiny of class proposals,” focusing on the Sixth and Seventh Circuit Court of Appeals’ decisions in a trio of front-load washing machine cases – as we have previously reported here. Id. at 12.
With respect to Wage and Hour Litigation, the Report focuses on the staggering statistic that “since 2007, there have been 150,000 wage and hour investigations [brought by the U.S. Department of Labor] which resulted in findings of 110,000 violations.” Id. at 76. Focusing on misclassification cases, the Report lists some of the more recent settlements in this area, including the fact that since 2009 the U.S. DOL has collected over $29 million in back wages for over 29,000 employees who were misclassified as independent contractors. Id. at 78. The Report also discusses the fact that employers will face even greater risk of potential liability when the employer mandate provisions of the Patient Protection and Affordable Health Care Act (ACA) take effect in 2014 since, “If an employer mistakenly believes it is exempt from the ACA’s mandate because its 50 workers are independent contractors and not employees, but is later found to have misclassified the workers, then it is subject to a penalty if any of its workers purchased insurance on a state or federal insurance exchange.” Id. at 80-81.
Implications For Employers
This excellent report by the U.S. Chamber of Commerce is truly a treasure trove of information for employers and corporate counsel and highlights the ever-changing landscape of workplace class action litigation.