Atlanta Employment Attorneys Blog
Succeeding in a Fair Labor Standards Act lawsuit involves many elements and decisions. For example, the employee who sues must make wise choices regarding who to sue and where to sue. Choosing imperfectly in these regards can leave the employee vulnerable to dismissal (and give employers a crucial tool to avoid litigating a case in a faraway location.) Whether you are an employee who has been denied compensation that complies with the law or you are an employer facing a potential FLSA lawsuit, an experienced Atlanta wage and hour lawyer can answer all your questions about court jurisdiction and FLSA lawsuits.
A recent unpaid overtime and minimum wage case from Athens, Georgia, illustrates how an employee’s flawed choices regarding where to file and whom to sue can lead to dismissal.
The employee was a truck driver for a trucking company based near Nashville, Tennessee. The trucker’s lawsuit alleged that the employer illegally classified him as an independent contractor rather than an employee. As a result, the driver’s compensation violated overtime and minimum wage laws, according to the suit.
In certain circumstances, corporate officers and directors can be personally liable for the FLSA violations of their companies. The FLSA states that a worker denied overtime or minimum wage can sue their employer, and defines that term as anyone “acting directly or indirectly in the interest of an employer in relation to an employee.” This definition allows some workers to pursue individuals in addition to corporate employers.
The employee in this trucking case sued the company’s CEO in federal court, specifically, the Middle District of Georgia. The CEO subsequently seized on that choice to pursue a successful motion to dismiss.
The problem for the trucker was that the CEO was a citizen of Tennessee, and the federal court in Georgia lacked what’s called “personal jurisdiction” over him.
A Deeper Look into Jurisdiction
To explain what that means, we first need to address some basics about civil lawsuits. The law states that for a judge to have the power to issue binding orders on the parties in a case, the court must, among other things, possess two crucial jurisdictional elements: subject matter jurisdiction and personal jurisdiction over the parties.
Subject matter jurisdiction means that a court has the power to resolve the type of dispute at issue and deliver a remedy. Federal courts, for example, only have subject matter jurisdiction over cases involving either issues related to federal law (“federal question”) or matters between opposing parties from different states where the complaining party seeks more than $75,000 (“diversity”).
Because the trucker alleged violation of the FLSA — a federal statute — he satisfied the “federal question standard.”
Personal jurisdiction means that a judge can only issue orders binding people or entities that maintain a certain level of contact with that state. The trucker argued that the federal court in Georgia had jurisdiction over the company’s CEO because the company “transacted business” in Georgia and the CEO was responsible for managing the company’s day-to-day activities.
The court, however, determined that the employee needed more. “Personal jurisdiction only extends to a corporate officer who is a ‘primary participant’ in ‘an alleged wrongdoing intentionally directed at a… resident’” of the state where the case was filed. The trucker did not provide the court with evidence suggesting that the CEO was the central player in any alleged wrongdoing directed at the driver in Georgia.
The specific weaknesses that the judge highlighted included the trucker’s failure to provide proof that the CEO was personally involved in any of his recruiting, hiring, or the decision to classify him as an independent contractor. The driver also lacked evidence that the CEO created “the company’s policies on how drivers would be classified and paid.”
Without those key things, the driver did not have enough to show the court had personal jurisdiction over the CEO, so the court dismissed the case against him.
Whether you are pursuing or defending a minimum wage or unpaid overtime case, you need skillful legal counsel who can ensure that your case (or defense) is not only factually strong but also legally and procedurally sound, as well. The team of Atlanta employee misclassification attorneys at the law firm of Parks, Chesin & Walbert has extensive experience handling a full array of FLSA matters, so we have the knowledge and experience necessary to ensure that all your bases are covered and that you are placed in the best possible position for success. Contact us through this website or at 404-873-8048 to schedule a consultation today.