United States District Court, N.D. Alabama, Southern Division
MADELINE HUGHES HAIKALA UNITED STATES DISTRICT JUDGE
Parker brought this action against her former employer and
its owner to recover compensation allegedly due under the
Fair Labor Standards Act, 29 U.S.C. § 201 et
seq. (Doc. 1). The Court stayed proceedings at the
parties' request to allow the parties to discuss
settlement. (Docs. 23, 25, 27). The parties have proposed a
settlement agreement for this Court to approve pursuant to
Lynn's Food Stores, Inc. v. United States, 679
F.2d 1350 (11th Cir.1982). (Docs. 28, 29). As discussed in
greater detail below, because the parties' agreement
represents a fair and reasonable resolution of a bona fide
dispute under the FLSA, the Court approves the parties'
Holley owns M&M Tire and Mechanical Services, Inc., a
mobile tire and mechanical service company for commercial
trucks. (Doc. 1, pp. 6-7, ¶ 28). Ms. Parker worked as a
dispatcher for M&M Tire from October 19, 2014 through
March 29, 2016. (Doc. 1, pp. 3, 6-7, ¶¶ 7, 28). Ms.
Parker alleges that during this time period, M&M Tire did
not pay her at the overtime rate for hours which exceeded
forty per week, paid her for only full hours worked, and
unilaterally reduced her hourly pay from $9.00 to $7.74 after
she complained to M&M Tire about her unpaid wages. (Doc.
1, pp. 7-8, ¶¶ 34, 36; Doc. 28, pp. 2-3).
Tire admits that “there were some work weeks in which
[Plaintiff] was not compensated at time and one half for
hours worked over forty” and that it “had actual
knowledge of the time Plaintiff reported through [M&M
Tire's] timekeeping system.” (Doc. 8, p. 4,
¶¶ 25, 36, 38-40). M&M Tire denies that it
willfully violated the FLSA, however, and it asserts that it
did not know or have reason to know that Ms. Parker did not
receive full overtime and hourly compensation. (Doc. 8, p. 4,
¶¶ 36, 38; Doc. 28, p. 3).
resolve her FLSA claims against the defendants, Ms. Parker
has agreed to dismiss her claims in exchange for M&M
Tire's payment of $3, 500 in back pay damages and $3, 500
in liquidated damages, remitted by December 31, 2018. (Doc.
29, pp. 1-2, ¶¶ 3-4, 7). M&M Tire also has
agreed to pay counsel for Ms. Parker $16, 554.60 in
attorney's fees and $993.15 in costs and expenses in two
installments. (Doc. 29, p. 2, ¶¶ 5, 7). The first
installment of $5, 849.25 is due on or before December 31,
2018, and the second installment of $11, 698.50 is due on or
before January 31, 2019. (Doc. 29, p. 2, ¶¶ 5, 7).
enacted the FLSA in 1938 with the goal of ‘protect[ing]
all covered workers from substandard wages and oppressive
working hours.'” Christopher v. SmithKline
Beecham Corp., 567 U.S. 142, 147 (2012) (quoting
Barrentine v. Arkansas-Best Freight Sys., Inc., 450
U.S. 728, 739 (1981) (noting that Congress designed the FLSA
“to ensure that each employee covered by the
Act would receive [a] fair day's pay for a fair day's
work and would be protected from the evil of overwork as well
as underpay”) (emphasis in original) (alterations and
quotation marks omitted)); see also 29 U.S.C. §
202(a) (indicating congressional intent to eliminate labor
conditions “detrimental to the maintenance of the minim
standard of living necessary for health, efficiency, and
general well-being of workers”). In the context of
overtime, for example, the FLSA obligates employers to
compensate employees for hours in excess of 40 per week at a
rate of 1½ times the employees' regular wages. 29
U.S.C. § 207(a).
employee proves that her employer violated the FLSA, then the
employer must remit to the employee all unpaid wages or
compensation, liquidated damages in an amount equal to the
unpaid wages, a reasonable attorney's fee, and costs. 29
U.S.C. § 216(b). “FLSA provisions are mandatory;
the ‘provisions are not subject to negotiation or
bargaining between employer and employee.'”
Silva v. Miller, 307 Fed.Appx. 349, 351 (11th Cir.
2009) (quoting Lynn's Food Stores, Inc. v. U.S. ex.
rel. U.S. Dep't of Labor, 679 F.2d 1350, 1352 (11th
Cir. 1982)); see also Brooklyn Savs. Bank v.
O'Neil, 324 U.S. 697, 707 (1945). “Any amount
due that is not in dispute must be paid unequivocally;
employers may not extract valuable concessions in return for
payment that is indisputably owed under the FLSA.”
Hogan v. Allstate Beverage Co., Inc., 821 F.Supp.2d
1274, 1282 (M.D. Ala. 2011).
parties may settle an FLSA claim for unpaid wages only if
there is a bona fide dispute relating to a material issue
concerning the claim. To compromise a claim for unpaid wages,
the parties must “present to the district court a
proposed settlement, [and] the district court may enter a
stipulated judgment after scrutinizing the settlement for
fairness.” Lynn's Food, 679 F.2d at 1352;
see also Hogan, 821 F.Supp.2d at 1281-82.
“[T]he parties requesting review of an FLSA compromise
must provide enough information for the court to examine the
bona fides of the dispute.” Dees v. Hydradry,
Inc., 706 F.Supp.2d 1227, 1241 (M.D. Fla. 2010). The
information that the parties provide should enable the Court
“to ensure that employees have received all uncontested
wages due and that they have received a fair deal regarding
any additional amount that remains in controversy.”
Hogan, 821 F.Supp.2d at 1282. “If a settlement
in an employee FLSA suit does reflect a reasonable compromise
over issues, such as FLSA coverage or computation of back
wages, that are actually in dispute, ” then a court may
approve the settlement. Lynn's Food, 679 F.2d at
1354; see also Silva, 307 Fed.Appx. at 351
(emphasizing that a proposed settlement must be fair and
there is a bona fide dispute concerning the nature of the
reduction in Ms. Parker's hourly wage and the extent to
which the defendants willfully violated the FLSA such that a
three-year statute of limitations would apply in this case.
With the benefit of the extensive time records and pay
reports that M&M Tire provided, Ms. Parker calculated
that M&M Tire owes her $5, 838 in backpay and liquidated
damages for the period from October 19, 2014 to September
2015 and $1, 626.39 in backpay for the period from September
12, 2015 to April 2, 2016. M&M Tire has agreed to pay the
full amount for the first time period, and the parties have
agreed to settle the amount in the latter time period for $1,
162. (Doc. 28, ¶¶ 3-5). These figures represent a
fair and reasonable settlement of Ms. Parker's claims.
Tire has agreed separately to pay Ms. Parker's
attorney's fees of $16, 554.60 and costs of $993.15. The
Court reviews “the reasonableness of counsel's
legal fees to assure both that counsel is compensated
adequately and that no conflict of interest taints the amount
the wronged employee recovers under a settlement
agreement.” Silva, 307 Fed.Appx. at 351
(citing Lynn's Food, 679 F.2d at 1352). The
parties negotiated the attorney's fees and costs after
settling Ms. Parker's claims. (Doc. 28, p. 8, ¶ 11).
Although the attorney's fees and costs exceed Ms.
Parker's settlement proceeds, the negotiated amount
reflects a reasonable and discounted hourly rate. (Doc. 28,
p. 8, ¶ 11). Under these circumstances, the Court finds
that the attorney's fees and costs are fair, reasonable,
and independent of Ms. Parker's settlement amount.
ensure that M&M Tire is not using an FLSA claim “to
leverage a release from liability unconnected to the FLSA[,
]” the Court has reviewed the release provision in the
settlement agreement. Moreno v. Regions Bank, 729
F.Supp.2d 1346, 1351 (M.D. Fla. 2010); see also
Hogan, 821 F.Supp.2d at 1282 (stating that an employer
may not require valuable concessions for wages due under the
FLSA). Under the release provision, Ms. Parker agrees to:
Waive and release every known or unknown wage and hour claim,
action, lawsuit or cause of action, asserted or unasserted,
that Plaintiff may have against Defendants relating to her
employment with Defendants from October ...