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Shutting the Gate: Temporary Worker Excluded From FLSA Collective Action

After conditionally certifying a collective action under Section 216(b) of the Fair Labor Standards Act (FLSA), the U.S. District Court for the District of Kansas recently struck an opt-in consent filed in the case. The court found that as a temporary worker, the opt-in plaintiff did not fit the collective action definition because she was not an “employee.”

In Lundine v. Gates Corporation, the named plaintiff filed suit “on behalf of herself and others similarly situated to recover alleged unpaid overtime wages from” the defendant employer. The court conditionally certified an FLSA collective action defined to include “[a]ll current and former nonexempt manufacturing employees.” Thereafter, an individual who worked at the defendant employer’s facility through a temporary staffing agency filed a consent to join the collective action. The defendant employer moved to strike the opt-in consent, arguing that as a temporary worker, the opt-in plaintiff did not fall under the collective action definition because she was not “employed” by the defendant employer. The court agreed, and struck the consent.

The court cited the Fifth Circuit’s “economic realities” test to determine “whether an individual is an employee under the FLSA,” and explained that courts look to such factors as:

  • The degree of control exerted by the alleged employer over the worker
  • The worker’s opportunity for profit or loss
  • The worker’s investment in the business
  • The permanence of the working relationship 
  • The degree of skill required to perform the work 
  • The extent to which the work is an integral part of the alleged employer’s business

According to the court, no single factor is dispositive. Examining the “totality of the circumstances,” the court determined that the opt-in plaintiff was “not an employee of [the defendant employer] for purposes of this FLSA collective action.” The court focused on the fact that, given the arrangement with the staffing agency, the defendant employer did not hire or fire specific temporary employees, did not dictate the temporary employees’ conditions of employment, and did not determine their rates of pay. As the court explained, the defendant employer did not pay the opt-in plaintiff’s wages; rather, it paid a lump sum to the staffing agency based on the staffing agency’s calculations. 

Ultimately, the court found that given the “unique business relationship” between the staffing agency and the defendant employer, the opt-in plaintiff was not employed by the defendant employer “in the traditional sense of the word.” Thus, the opt-in plaintiff and “other similarly situated temporary workers” did not fit the collective action definition, and her opt-in consent was stricken.

The Lundine decision is a useful reminder to employers defending collective actions under Section 216(b) of the FLSA that the validity of an opt-in consent should not always be presumed, particularly when there are categorical differences among the populations at issue. Employers of temporary workers may also want to review the court’s analysis to determine which entity is the employer for purposes of the FLSA. 

© 2020 BARNES & THORNBURG LLPNational Law Review, Volume X, Number 114


About this Author

Peter J. Wozniak Barnes Thornburg Chicago  Labor Employment

Pete Wozniak is a vigorous advocate who strives to help his clients navigate issues that can be fraught with challenges as painlessly and efficiently as possible. He is a candid and personable counselor, offering his clients direct advice by leveraging his deep experience performing a broad range of outcome critical functions for complex labor and employment matters.

Pete represents clients across a number of industries, including transportation and logistics, restaurants, retail, manufacturing, and temporary staffing. Handling a number of high profile matters, he identifies the...

Mark Wallin, Attorney, BT, Chicago, Labor Employment
Of Counsel

In order to provide the best counsel, Mark Wallin believes it is his role to understand his clients’ business needs so he can help them determine what resolution will provide the most benefit. His keen ability to understand his clients’ practical concerns allows him to advise on the best path to successfully resolve issues – whether through traditional litigation or negotiated resolution.

In the course of his practice, Mark has focused on providing the highest-level of service to his clients and building long-term relationships. Specifically, he defends employers in a wide range of employment matters including wage and hour class and collective actions, as well as complex, multi-plaintiff and single plaintiff employment discrimination claims brought not only by private plaintiffs but also initiated by the Equal Employment Opportunity Commission (EEOC).

Mark has successfully represented companies of virtually all sizes, litigating matters across multiple areas of the law, from the pleading stage through appeal. He has also represented clients in arbitrations and before administrative bodies.

Mark vigilantly stays abreast of cases, laws, and trends that may impact his clients coming out of the courts, Congress and the state legislature, as well as the U.S. Department of Labor, the EEOC, and state regulatory agencies. He strives to keep a watchful eye on how labor and employment related laws are evolving so as to proactively advise clients.

In addition to his regular legal practice, Mark has undertaken several pro bono cases including trying criminal jury trials in state and federal court, and representing indigent plaintiffs in civil rights matters as part of the federal Trial Bar.

Mark began honing his litigation skill during law school when he interned at the U.S. Attorney’s office for the Northern District of Illinois, where he handled both civil and criminal issues. He also interned for a judge on the U.S. Court of Appeals for the Seventh Circuit, which gave him a unique vantage of seeing the issues from the court’s perspective.