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UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA ________________________________________________________________________ Duniyo Hussein, Naima Omar Issa, Leyla Yusuf, Raymond Deshler, Assiongbonvi “Luc” Kangnigan, Melvin Holmes, Abraham Quevedo Orantes, Leticia Zuniga Escamilla, on behalf of themselves, the Proposed Rule 23 Class, and others similarly situated,

Court File No. 15-cv-2498

CLASS ACTION COMPLAINT (JURY TRIAL DEMANDED)

Plaintiffs, v. Capital Building Services Group, Inc., Defendant. ________________________________________________________________________ Plaintiffs Duniyo Hussein (“Plaintiff Hussein”), Naima Omar Issa (“Plaintiff Issa”), Leyla Yusuf (“Plaintiff Yusuf”), Raymond Deshler (“Plaintiff Deshler”), Assiongbonvi “Luc” Kangnigan (“Plaintiff Kangnigan”), Melvin Holmes (“Plaintiff Holmes”), Abraham Quevedo Orantes (“Plaintiff Quevedo”), and Leticia Zuniga Escamilla (“Plaintiff Zuniga”) (collectively, “Plaintiffs”), on behalf of themselves, the proposed Rule 23 Class, and others similarly situated, by and through their attorneys, Nichols Kaster, PLLP, bring this action for damages and other relief for Defendant’s violations of the Fair Labor Standards Act and Minnesota state law. PRELIMINARY STATEMENT 1.

This case is about the victims of the subcontracted labor market, in which

the workers who keep Minnesota’s businesses safe and clean no longer work for those businesses. Increasingly, Minnesota businesses subcontract out to the lowest bidder labor

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traditionally performed by their own employees. The result is a classic race-to-thebottom, where unscrupulous subcontractors compete for contracts by exploiting vulnerable workers to keep costs low. In this new “fissured workplace,”1 some of the most egregious mistreatment of workers occurs right under the noses of some of Minnesota’s most esteemed businesses and retail establishments. 2.

Plaintiffs work at Macy’s and Herberger’s department stores throughout

Minnesota. Plaintiffs work to keep the stores clean and presentable—cleaning bathrooms, polishing floors, emptying the trash, and maintaining store fixtures. On paper, however, Plaintiffs are not employed by Macy’s or Herberger’s. Instead, Plaintiffs are employed by Defendant Capital Building Services Group, Inc. (“Defendant” or “Capital”), who has contracted with Macy’s and Herberger’s to clean their stores. 3.

Companies like Capital are essentially middlemen who exist to sell a single

product: labor. These companies operate in an extremely competitive market environment, typically bidding for cleaning jobs by the square foot against other similar companies. As a consequence, companies like Capital come under enormous economic pressure to cut corners when it comes to following labor and employment laws. The math is simple: in order to turn a profit, companies like Capital must keep their expenses— overwhelmingly wage payments made to employees—below their contractually agreedupon income from store contracts. To undercut their competitors, and turn a profit on 1

See David Weil, The Fissured Workplace: Why Work Became So Bad for So Many and What Can Be Done to Improve It 7, 76 (2014); Richard B. Freeman, The Subcontracted Labor Market, 18 Labor and Employment Relations Association: Perspectives on Work 38, 38 (2014).

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their contracts, companies like Capital routinely fail to pay their workers for all hours worked, pay less than minimum wage, and skimp on overtime premiums. By doing so, companies like Capital gain a competitive advantage in the marketplace by breaking the law. 4.

Companies like Macy’s and Herberger’s benefit tremendously from this

arrangement. Macy’s and Herberger’s get their stores cleaned for much less than it would otherwise cost to pay their own employees, legally, to do the same work. At the same time, Macy’s and Herberger’s effectively turn a blind eye to widespread violations of state and federal employment laws happening under their own roofs. 5.

To make this scheme work, Capital typically hires employees who live at

the margins of economic life. Many of Capital’s employees are recent immigrants with limited English proficiency. Others have undergone long periods of unemployment. For these reasons and others, employees are often willing to accept substandard and illegal conditions of employment for the simple reason that having a job is better than having no job. 6.

Capital’s violations of state and federal wage and hour laws are systematic

and severe. Capital tells its employees they will be paid minimum wage, but in practice their employees’ wages fall well short of minimum wage—in some cases as little as $4 or $5 an hour. Employees are generally not paid overtime when they work over forty hours in a workweek. Workers’ paychecks frequently come up short, given the regular time and overtime actually worked. Meal breaks are systematically deducted from employees’ hours worked, even when those breaks are not actually taken. Some employees have to 3

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purchase their own cleaning supplies, and these unreimbursed expenses cause employees’ wages to drop even further below minimum wage. When employees are asked to clean a store where they do not normally work, their time is seldom tracked, and often unpaid. Travel time between stores is not compensated. Workers have no choice but to be paid with debit cards, and thus must pay ATM fees in order to access their own wages. Beginning in their second pay period, employees’ only other option is to receive direct deposit, which is not an option for workers who do not have bank accounts. On numerous occasions, terminated employees were not paid for work performed during their final pay periods. 7.

There is no paper trail to document most of these violations. Minnesota and

federal law require employers to maintain accurate employment records and supply pay stubs to employees. Capital did neither, effectively keeping its employees in the dark and minimizing evidence of its repeated violations of the law. 8.

Many Capital employees complained about the company’s illegal labor

practices to managers and corporate representatives. Nothing was ever done in response to these complaints. 9.

Capital’s severe and pervasive violations of the law hurt everyone involved.

They harm Capital’s employees, who are forced to work under substandard conditions. They put other companies that—unlike Capital—follow the rules at an unfair competitive disadvantage in the marketplace. And they hurt unemployed workers, who are forced to compete for jobs that fall far below the minimum standards established by law.

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10.

Plaintiffs bring this class action on behalf of themselves and all individuals

employed by Defendant as hourly cleaning workers in the State of Minnesota in the three years prior to the filing of this Complaint (the proposed “Rule 23 Class”) pursuant to Rule 23 of the Federal Rules of Civil Procedure to remedy violations of Minnesota state law, including but not limited to the Minnesota Payment of Wages Act, Minn. Stat. § 181.001, et seq. (“PWA”), and supporting regulations, and the Minnesota Fair Labor Standards Act, Minn. Stat. § 177.21, et seq. (“MFLSA”), and supporting regulations. 11.

Plaintiffs, on behalf of themselves and others similarly situated (the

proposed “FLSA Collective”) bring this collective action—consisting of all hourly cleaning workers employed by Defendant in the State of Minnesota at any time within three years prior to the filing of the Complaint—against Defendant pursuant to the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (“FLSA”) for failure to pay minimum wage and overtime compensation for all hours worked. 12.

Defendant has willfully engaged in a pattern, policy, and practice of

unlawful conduct for the actions alleged in this Complaint, in violation of the federal and state rights of Plaintiffs, members of the proposed Rule 23 Class, and other similarly situated workers. PARTIES Plaintiffs 13.

Plaintiff Issa is an adult resident of Minnesota. Plaintiff Issa was employed

by Defendant as a cleaner from approximately September 2013 to March 2015 and worked at the Mall of America Macy’s store. 5

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14.

Plaintiff Yusuf is an adult resident of Minnesota. Plaintiff Yusuf was

employed by Defendant as a cleaner from approximately December 1, 2014 to January 2, 2015. Plaintiff Yusuf worked at the Mall of America and Southdale Macy’s stores. 15.

Plaintiff Hussein is an adult resident of Minnesota. Plaintiff Hussein has

been employed as a cleaner by Defendant from approximately December 2013 to January 2015, and from March 2015 to the present. She works primarily at the Mall of America Macy’s but has also worked at the Roseville and Maplewood Macy’s stores. 16.

Plaintiff Deshler is an adult resident of Minnesota. Plaintiff Deshler has

been employed as a cleaner by Defendant from approximately March 2014 to the present. Plaintiff Deshler works at the Herberger’s Clearance Center in Maplewood, Minnesota and has worked at the Macy’s store in Maplewood. 17.

Plaintiff Kangnigan is an adult resident of Minnesota. Plaintiff Kangnigan

was employed by Defendant as a cleaner from approximately October 2014 to March 2015. Plaintiff Kangnigan worked at the Burnsville and Mall of America Macy’s stores. 18.

Plaintiff Holmes is an adult resident of Minnesota. Plaintiff Holmes has

been employed by Defendant as a cleaner and crew leader from approximately 2012 to the present. Plaintiff Holmes works primarily at the Macy’s store in Maplewood, but has worked at many Macy’s and Herberger’s stores throughout Minnesota in his capacity as a crew leader. 19.

Plaintiff Quevedo is an adult resident of Minnesota. Plaintiff Quevedo has

been employed by Defendant as a cleaner, crew leader, and area manager from January 2011 to the present. As a cleaner and crew leader, Plaintiff Quevedo has worked primarily 6

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at the Blaine and Edina Southdale Herberger’s locations, and currently works as a cleaner at the Edina Southdale Herberger’s. As an area manager, Plaintiff Quevedo worked at twenty different Macy’s and Herberger’s stores throughout Minnesota. 20.

Plaintiff Zuniga is an adult resident of Minnesota. Plaintiff Zuniga has been

employed by Defendant as a cleaner and crew leader from approximately April 2012 to the present. She worked at the Herberger’s in Blaine but now works at the Edina Southdale Herberger’s. Defendant 21.

Defendant Capital Building Services Group, Inc. provides commercial

cleaning services to retail, corporate, commercial, industrial, banking, and educational venues. Defendant is an Illinois corporation with corporate headquarters at 540 Capital Drive, Suite 100, Lake Zurich, IL 60047. 22.

Defendant provides commercial cleaning services to retail, corporate,

commercial, industrial, and educational business venues facilities in 25 different states. 23.

At all relevant times, Defendant has had an annual gross volume of sales

made or business done in excess of $500,000.00. JURISDICTION AND VENUE 24.

This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331

because this action involves a federal question, 29 U.S.C. § 216(b). 25.

This Court also has supplemental jurisdiction over Plaintiffs’ state law

claims pursuant to 28 U.S.C. § 1367 because Plaintiffs’ state and federal claims are so related that they form part of the same case or controversy. 7

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26.

Venue is proper in the United States District Court, District of Minnesota,

pursuant to 28 U.S.C. § 1391, because Defendant resides or conducts business in this District and because the unlawful practices described herein were committed in this District. FACTUAL ALLEGATIONS Common Factual Allegations 27.

Failure to provide paystubs. Until the filing of this lawsuit was imminent,

Defendant had never furnished Plaintiffs with a single paper paystub. Plaintiffs and other Capital employees have made repeated requests to their supervisors, managers, and to Defendant’s corporate office for paystubs, but every request was denied or ignored. Plaintiffs have not been provided with on-the-job computer access to electronic paystubs. 28.

Underreporting of hours worked. Defendant purports to have a timekeeping

system, but Defendant does not compensate its employees according to any timekeeping entries. Based upon Plaintiffs’ net pay, admissions by Defendant’s managers, and Plaintiffs’ own experience working in managerial positions, Plaintiffs have learned that Defendant systematically underreports Plaintiffs’ hours worked. It is not uncommon for entire shifts to disappear, especially when Plaintiffs work at a store other than their usual store, or the time would have put Plaintiffs over forty hours for the week. Defendant creates a budget of cleaning hours for each of its stores that sets a limit on the number of hours of labor Defendant wants to compensate each week. When Plaintiffs’ actual hours worked for the week exceeds this budget, Defendant frequently underreports Plaintiffs’ hours to keep payroll costs in line with the budget. 8

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29.

Working though breaks. Defendant automatically deducts meal breaks from

Plaintiffs’ hours worked regardless of those breaks were actually taken. Plaintiffs are frequently not permitted to take a lunch break. When they are permitted to take breaks, Plaintiffs’ breaks are often interrupted by calls on the radio to perform work. Plaintiffs are expected to remain on-call throughout lunch breaks. 30.

Unreimbursed expenses. Several Capital employees are required to

purchase their own cleaning supplies. Defendant does not reimburse those expenses, and does not take the expenses into account when calculating whether Plaintiffs have been paid at the applicable state or federal minimum wage rate. 31.

Debit cards. Defendant pays Plaintiffs by giving them prepaid debit cards

with Plaintiffs’ net pay added as the card’s balance. Plaintiffs are unable to access the funds on these cards without paying ATM/bank fees. Defendant does not give Plaintiffs the ability to withdraw the balance on the card free of fees. Plaintiffs are permitted to receive direct deposit after the first pay period working for Capital, but that method of payment is not available to those Plaintiffs who do not have a bank account. Plaintiffs have made numerous requests for payment through paper paychecks (preferably with attached paystubs), and those requests have been denied. 32.

Travel time. Some Plaintiffs are required to clean multiple stores during

one shift, or are required to report to one store and then travel to a different store to perform their work duties. Defendant does not compensate Plaintiffs for their travel time between work sites.

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33.

Refusal to pay wages upon termination. Defendant has terminated multiple

employees and subsequently refused to pay employees for the hours worked during their last pay period. 34.

Minimum wage violations. Defendant claims to pay Plaintiffs and other

cleaners minimum wage. Before August 1, 2014, cleaners were supposedly paid the federal minimum wage of $7.25 per hour. Since August 1, 2014, Defendant alleges it has paid its cleaners $8 per hour to comply with Minnesota’s minimum wage. But as a result of Defendant’s numerous illegal pay practices outlined above, Plaintiffs’ wages systematically fell below the state and federal minimum wage rates. Though it is difficult to document these minimum-wage violations with exactitude without paystubs or timekeeping records, an employee earning $8 an hour should generally receive take home pay of $7.38 per hour after taxes.2 An employee earning the federal minimum wage of $7.25 per hour should generally receive take home pay of $6.70 per hour after taxes.3

2

This assumes Social Security and Medicare deductions of 6.2 percent and 1.45 percent, respectively, and no federal or state income tax withholding. Generally, a single person without children working full-time for $8 per hour will have $.50 per hour withheld for federal income taxes, while a married person will not have income taxes withheld. See IRS Publication 15 (2015) at 47, 49, available at http://www.irs.gov/pub/irs-pdf/p15.pdf (showing federal income tax withholding for an employee earning $320 per weekly pay period ($8 times 40 hours) depending on number of exemptions and filing status). 3

This assumes Social Security and Medicare deductions of 6.2 percent and 1.45 percent, respectively, and no federal or state income tax withholding. Generally, a single person without children working full time and earning $7.25 per hour will have $.40 per hour withheld for federal income taxes, while a married person with similar earnings would not have income taxes withheld. See IRS Publication 15 (2015) at 47, 49, available at http://www.irs.gov/pub/irs-pdf/p15.pdf (showing federal income tax withholding for an 10

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Plaintiffs’ net take home pay, based on the total number of hours actually worked and the amount of wages actually paid, systematically fell below these levels. 35.

Overtime violations. Several Plaintiffs have been told by their district

manager that Defendant will not pay them overtime. Defendant’s practice matches the words of its managers. When Plaintiffs work more than 40 hours in a workweek, their net pay does not reflect an overtime premium, as required by law. 36.

Defendant’s willful and repeated violations. Defendant has knowledge of

the violations of the PWA, FLSA, and MFLSA described in this Complaint. Defendant and its managers were responsible for: entering the amount of time worked by employees; failing to provide paystubs; paying employees with prepaid debit cards; interrupting employees’ lunch breaks; automatically deducting breaks even when those breaks had been interrupted or were never taken; and refusing to pay certain terminated employees. Furthermore, Plaintiffs made numerous complaints to Defendant’s managers and employees at its corporate office regarding Defendant’s illegal policies and practices but Defendant failed to institute any remedy. 37.

Defendant’s conduct alleged in this Complaint was willful and in bad faith.

Defendant did not have a good faith basis to believe the objectionable policies and practices identified in this Complaint complied with the law.

employee earning $290 per weekly pay period ($7.25 times 40 hours) depending on number of exemptions and filing status). 11

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Plaintiffs’ Employment Experiences Plaintiff Hussein 38.

Plaintiff Hussein works for Defendant as a cleaner at the Mall of America

Macy’s. She worked for Defendant from December 2013 to January 2015, resumed working for Defendant in March 2015, and is currently employed by Defendant. Defendant hired her at a rate of $7.25 per hour, and her alleged rate was increased to $8.00 per hour on August 1, 2014. 39.

Plaintiff Hussein never received a written earnings statement for any of the

pay periods that she worked for Defendant until March 2015, when Defendant became aware that this litigation was imminent. Plaintiff Hussein was never provided with access to an employer-owned computer during her regular working hours to review or print earnings statements. 40.

Defendant would automatically deduct lunch breaks that weren’t actually

taken. The lunch breaks that Plaintiff Hussein did actually take were frequently interrupted by calls on the radio requiring her to perform work. 41.

Plaintiff Hussein was routinely not paid for all of the hours that she worked.

Her take-home pay was lower than it should have been based upon the number of hours she worked. For example, her net pay for the pay period from June 18, 2014 to July 1, 2014 was $539.12, despite having worked 130 hours during that two-week pay period. That works out to only $4.14 an hour. 42.

Plaintiff Hussein occasionally worked more than forty hours in a workweek

but was not paid one-and-one-half times her regular rate of pay for hours worked in 12

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excess of forty in a workweek. For example, in the pay period from June 18, 2014 to July 1, 2014, Plaintiff Hussein worked approximately 130 hours but only received net pay of $539.12 for the two-week pay period—well short of the time-and-a-half owed on the hours worked over 40 a week. 43.

Plaintiff Hussein was not compensated for several days of work that she

performed. During the pay period from March 12, 2014 to March 26, 2014, Plaintiff Hussein worked two 8-hours shifts at the Macy’s in Roseville and one 7-hour shift at the Macy’s in Maplewood, but received no wages for the 23 hours of work that she performed on those three days. Plaintiff Issa 44.

Plaintiff Issa worked for Defendant as a cleaner at the Mall of America

Macy’s from approximately September 2013 to March 2015. Capital hired her at a wage of $7.25 per hour. On August 1, 2014, her wage rate was allegedly increased to $8.00 per hour. Plaintiff Issa was paid every two weeks. 45.

Plaintiff Issa never received a written earnings statement for any of the

approximately 40 pay periods that she worked for Defendant. She was never provided access to an employer-owned computer during her regular working hours to review or print earnings statements. 46.

Defendant automatically deducted lunch breaks from her hours worked,

even though much of the time Plaintiff Issa was never able to take a lunch break, or her break was interrupted by calls on the radio demanding that she perform job duties.

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47.

Plaintiff Issa’s take-home pay was significantly less than it should have

been based on the number of hours that she worked. Plaintiff Issa complained about this to her managers but no action was taken. 48.

Plaintiff Issa worked more than forty hours in several workweeks but was

never paid overtime wages. For example, in the two-week pay period ending January 14, 2014, Plaintiff Issa worked 108.5 hours, but only received net pay of $703.49, equal to net pay of $6.48 per hour. Given that she worked at least 28 hours of overtime, Plaintiff Issa’s net pay should have been much higher than the $703.49 she received. Plaintiff Yusuf 49.

Plaintiff Yusuf worked for Defendant as a cleaner from December 1, 2014

to January 2, 2015. She worked 57 hours total during that time. Plaintiff Yusuf was only paid $230.97 for her hours worked, which works out to $4.05 per hour. Plaintiff Yusuf never received a paystub, and was never given the ability to view or print her paystubs on a computer during her working hours. 50.

Initially, Capital failed to pay Plaintiff Yusuf for the work performed during

her first pay period working for Capital. On approximately January 2, 2015, Plaintiff Yusuf called Rudy Hanuman, the district manager at Capital, to complain about not receiving any pay. Plaintiff Yusuf told him that she could not continue to work at Capital unless the company made arrangements to ensure she would get paid in the near future for the hours she had worked. Plaintiff Yusuf called several other times that day to try and reach Hanuman, but reached his voice mail each time. Plaintiff Yusuf’s district manager called her back the next day, and told her that he would find another person to do the job. 14

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51.

After Plaintiff Yusuf was terminated, Capital mailed her a debit card with a

balance of $230.97. Given the number of hours she had worked, Plaintiff Yusuf realized this amount was below minimum wage and less than what Capital had promised to pay her. Plaintiff Yusuf called the district manager several more times about the money she was still owed, and left several messages. The district manager never responded to these demands. Plaintiff Deshler 52.

Plaintiff Deshler has worked for Defendant as a cleaner at the Herberger’s

Clearance Center in Maplewood and Maplewood Macy’s since March 2014. Defendant agreed to pay him $7.25 per hour prior to August 1, 2014. Plaintiff Deshler believes he is currently being paid $7.75 an hour. 53.

Plaintiff Deshler has never received a paystub. Plaintiff Deshler was never

provided electronic access to his paychecks, and was never provided with access to an employer-owned computer during her regular working hours to review or print earnings statements. Plaintiff Deshler wrote to Defendant asking for copies of his pay stubs, but Defendant failed to respond. 54.

Plaintiff Deshler’s wages are paid via prepaid debit card. He is forced to

incur ATM fees and other charges to access his wages. In addition, Plaintiff Deshler is frequently unable to withdraw all his wages on or shortly after his pay day. 55.

Plaintiff Deshler is required to buy his own cleaning supplies, such as toilet

bowl cleaner, tire cleaner, window cleaner, carpet cleaners, rags, sponges, and mops, to perform his job duties. Plaintiff Deshler has complained to multiple managers about 15

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being forced to purchase cleaning supplies to do his job, but no action has ever been taken. Plaintiff Kangnigan 56.

Plaintiff Kangnigan worked for Defendant as a cleaner at the Mall of

America and Burnsville Macy’s stores from October 2014 until March 2015. His wage rate was allegedly $8 an hour while he worked for Defendant. 57.

Plaintiff Kangnigan was not paid for his first two weeks working for

Defendant and was not paid for his last two weeks working for Defendant. 58.

Plaintiff Kangnigan never received a paystub. He was never given access to

a computer at work to view or print out his pay stubs. 59.

Plaintiff Kangnigan was routinely required to work through his breaks, but

breaks were still deducted from his hours worked. 60.

Defendant did not pay Plaintiff Kangnigan for all his hours of work. For

example, during multiple pay periods in December 2014 and January 2015, based upon his net pay, Plaintiff Kangnigan was paid less than the state and federal minimum wage, even after taking employment taxes and income tax withholding into account. 61.

Plaintiff Kangnigan worked over 40 hours in several workweeks during

December 2014 and January 2015, and over 50 hours at least once, but was not paid a time-and-a-half overtime premium for hours worked in excess of 40 in a workweek. Plaintiff Holmes 62.

Plaintiff Holmes has worked as a cleaner and crew leader from

approximately 2012 to the present. He works primarily at the Maplewood Macy’s, but in 16

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his capacity as crew leader has been required to clean Macy’s and Herberger’s stores throughout Minnesota. 63.

Plaintiff Holmes was hired at a pay rate of $7.25 per hour. His rate was

allegedly increased to $8 per hour three months after he was promoted to the position of crew leader. He was supposedly given two pay increases since that time, and is told that his pay rate is currently $9.75 per hour. 64.

Plaintiff Holmes has never received a paystub from Capital. He was never

given access at work to a computer to view his paystubs, nor was he ever given the ability to print out his paystubs while at work. Beginning earlier in 2015, Plaintiff Holmes was able to view his paystubs online. However, the online statements do not show the number of works worked; they only show my gross pay and net pay. 65.

Plaintiff Holmes’ net pay is consistently lower than it should be based upon

his hours worked. For example, Plaintiff Holmes was required to work a 23-hour shift on Black Friday in 2014, after his district manager Rudy Hanuman called him at 2:00 AM and threatened to fire him if did not work through the next day. Despite Plaintiff Holmes’ sacrifice, most of those 23 hours were not reflected on his next paycheck. When he asked his district manager about the hours for which he was not paid, his district manager said, as he usually did in similar situations, that he would make it up to Plaintiff Holmes on the next paycheck. But, as has typically occurred in similar situations, Plaintiff Holmes was not paid for those Black Friday hours, on the next paycheck or any other. 66.

Plaintiff Holmes has made numerous inquiries to his current and former

district managers about underreporting of hours, underpayment of wages, and the lack of 17

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written paystubs. On each occasion, they either refused to address his concerns or told him to call Amy Lowe, who supposedly is responsible for running payroll for Capital. Every time Plaintiff Holmes tried to call her, his call would either go to voice mail, or she would dismiss his concerns. 67.

Plaintiff Holmes frequently works more than 40 hours in a workweek.

However based upon his net pay, Plaintiff Holmes is not being paid overtime rates for his hours worked in excess of forty in a workweek. For example, during the two-week pay period in 2014 that included Thanksgiving and Black Friday, Plaintiff Holmes worked approximately 120 hours, but was not paid overtime compensation for his hours worked in excess of forty in each workweek. Plaintiff Quevedo 68.

Plaintiff Quevedo has worked for Capital as a cleaner, crew leader, and area

manager from approximately January 2, 2011 to the present. He first worked at the Mall of America Macy’s store. He then began working at the Blaine Herberger’s store, and in April 2011 while working at the Blaine Herberger’s was promoted to crew leader. Plaintiff Quevedo worked at the Blaine Herberger’s store as a crew leader for approximately two years. He was then promoted to area manager in approximately January 2014, and held that position for approximately eight to nine months. As area manager, Plaintiff Quevedo oversaw twenty stores in Minnesota consisting of nine Macy’s stores and eleven Herberger’s stores. He moved back to the position of cleaner in approximately September 2014. Plaintiff Quevedo has been a cleaner from September

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2014 to the present, and presently works primarily at the Edina Southdale Herberger’s store. 69.

While Plaintiff Quevedo was area manager, all payroll was run by the

district manager Rudy Hanuman. Hanuman refused to allow Plaintiff Quevedo to get involved with managing payroll. Plaintiff Quevedo received frequent complaints from employees at several different stores regarding missing hours and inadequate pay, and was instructed to tell them to “check the computer,” even though Defendant had never given these employees a way to view their earnings statements online or at a work computer. 70.

While working as an area manager, Plaintiff Quevedo was classified as

exempt from overtime pay and told he would receive a salary of $36,000 per year. While working as an area manager, Plaintiff Quevedo experienced wage theft. Despite being a salaried employee, his take home pay in given pay period varied from $950 to $1500. 71.

Plaintiff Quevedo’s classification as an exempt employee was improper—

his primary job duty consisted of traveling between stores to perform cleaning tasks when a cleaner was missing from work. These duties primarily consisted of mopping and waxing floors, emptying garbage, vacuuming, and cleaning bathrooms. Plaintiff Quevedo did not make hiring decisions and did not have the authority to terminate employees. 72.

As area manager, Plaintiff Quevedo systematically worked overtime. He

generally worked seven days a week from 6:00 AM to 4:00 or 5:00 PM, averaging approximately 70 hours per week.

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73.

As a cleaner, Plaintiff Quevedo was subject to the same illegal practices as

other cleaners. When he was hired as a cleaner, Defendant agreed to pay Plaintiff Quevedo $7.25 per hour, then stated his pay would be increased to $8.50 per hour when he was promoted to crew leader. He was promised pay of $10.00 per hour after being demoted from area manager to the position of cleaner. Plaintiff Quevedo recently discovered that his actual rate of pay after his demotion was only $9.25 per hour. 74.

Plaintiff Quevedo has never received a paystub. He was never given access

to a computer at work where he could view his earnings statements or print them out. Near the beginning of 2015, Plaintiff Quevedo was given the ability to see his paystubs online when Capital switched its payroll to the company Employco. However Plaintiff Quevedo is only able to see his gross and net pay, not his hours worked. 75.

Plaintiff Quevedo experienced the same wage theft as the other members of

the class. For example, as a cleaner at the Southdale Herberger’s, it takes Plaintiff Quevedo and his wife, Plaintiff Zuniga, about four hours apiece to clean the store, or 28 hours per week. Based upon his net pay, Plaintiff Zuniga does not believe he is being paid for all of these hours. Plaintiff Quevedo has been told by the District Manager that Capital has budgeted only 44 hours of cleaner time to cleaning the Southdale Herberger’s. Plaintiff Quevedo believes he is not being paid for all of his hours worked in an attempt to keep the store within its “budget” for cleaner hours. 76.

As a cleaner, Plaintiff Quevedo occasionally works more than 40 hours per

workweek. For example, over the workweek in 2014 including Thanksgiving in Black

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Friday, Plaintiff Quevedo worked over 40 hours but was not paid any overtime compensation for those hours in excess of forty. Plaintiff Zuniga 77.

Plaintiff Zuniga has worked at Capital as a cleaner and crew leader from

approximately April 2012 to the present. She became a crew leader in 2014. Capital agreed to pay her $7.25 when she was hired, then agreed to give her a raise to $9.00 per hour when she was promoted to crew leader. However, Plaintiff Zuniga recently learned that her hourly wage is only $8.50 per hour. 78.

Plaintiff Zuniga has never received a paystub from Capital. She was never

given access to a computer at work to view her earnings statements, nor was she given the ability to print out her paystubs while at work. 79.

As described above, based upon her net pay, Plaintiff Zuniga is not paid for

all of her works worked. She works approximately 28 hours per week at the Edina Southdale Herberger’s, but based upon her net pay, it appears that she is not being compensated for several hours of her time worked each week. 80.

Plaintiff Zuniga occasionally works overtime hours, but is not paid

overtime compensation. For example, during the workweek including Black Friday and Thanksgiving, she worked more than 40 hours, but was not paid an overtime premium for hours worked in excess of 40 in a workweek. 81.

Defendant had knowledge of these violations of the PWA, FLSA, and

MFLSA. Defendant and its managers were responsible for: entering the amount of time worked by employees; failing to provide paystubs; paying employees with prepaid debit 21

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cards; interrupting employees’ lunch breaks; automatically deducting breaks even when those breaks had been interrupted or were never taken; and refusing to pay certain terminated employees. Furthermore, Plaintiffs made numerous complaints to Defendant’s managers and employees at its corporate office regarding Defendant’s illegal policies and practices but Defendant failed to institute any remedy. 82.

Defendant’s conduct alleged in this Complaint was willful and in bad faith.

Defendant did not have a good faith basis to believe the objectionable policies and practices identified in this Complaint complied with the law. CLASS ACTION ALLEGATIONS 83.

Plaintiffs bring Counts One, Four, Five, Six, Seven, and Eight individually

and as a class action pursuant to Rule 23 of the Federal Rules of Civil Procedure. The proposed Rule 23 Class is defined as: All individuals employed by Defendant as cleaners (including crew leads) in Minnesota at any time within three years prior to the filing of this Complaint. 84.

The persons in the proposed Rule 23 Class are so numerous that joinder of

all of the proposed Rule 23 Class members is impracticable. While the precise number of class members has not been determined at this time, upon information and belief, Defendant has employed at least one hundred cleaners in Minnesota during the applicable limitations period. Plaintiffs and the proposed Rule 23 Class have been similarly affected by Defendant’s unlawful practices and policies.

22

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85.

There are questions of law and fact common to the proposed Rule 23 Class

that predominate over any questions solely affecting individual members of the proposed Rule 23 Class, including but not limited to: a.

whether Defendant violated the MFLSA, specifically Minn. Stat. § 177.24 (and accompanying regulations) by failing to pay employees the required minimum wage for all hours worked;

b.

whether Defendant violated Minn. Stat. §§ 181.101, 181.13, and 181.14 by failing to pay current and former employees all earned wages;

c.

whether Defendant violated Minn. Stat. § 177.25 (and accompanying regulations) by failing to pay employees an overtime premium of one-andone-half times their regular hourly rate for hours worked in excess of fortyeight in a workweek;

d.

whether Defendant violated Minn. Stat. § 181.032 by failing to provide paystubs to its employees;

e.

whether Defendant violated Minn. Stat. §§ 177.23, subd. 4, 177.255, by employing an illegal method of paying employees;

f.

whether Defendant violated Minn. Stat. § 177.30, by failing to maintain accurate timekeeping records for all its employees;

g.

whether Defendant violated Minn. Stat. §§ 177.253–.254 (and accompanying regulations) by improperly deducting rest and meal breaks from employees’ hours worked;

h.

the proper measure of compensatory damages, liquidated damages, and civil penalties; and

i.

whether Defendant should be enjoined from such violations in the future.

86.

Plaintiffs’ claims are typical of those of the proposed Rule 23 Class.

Plaintiffs, like other members of the proposed Rule 23 Class, were subjected to Defendant’s unlawful policies and practices, resulting in a multitude of violations of the

23

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 24 of 46

PWA and the MFLSA. Plaintiffs and members of the proposed Rule 23 Class have sustained similar injuries as a result of Defendant’s actions. 87.

Plaintiffs will fairly and adequately protect the interests of the Rule 23

Class, and have retained counsel experienced in complex wage and hour class action litigation. 88.

This action is properly maintainable as a class action under Fed. R. Civ. P.

23(b)(1)(A) because prosecuting separate actions by individual class members would create a risk of inconsistent or varying adjudications with respect to individual class members that would establish incompatible standards of conduct for Defendant. 89.

This action is properly maintainable as a class action under Fed. R. Civ. P.

23(b)(2) because Defendant has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole. 90.

This action is properly maintainable as a class action under Fed. R. Civ. P.

23(b)(3) because questions of law or fact predominate over any questions affecting individual class members, and a class action is superior to other methods in order to ensure a fair and efficient adjudication of this controversy because, in the context of wage and hour litigation, individual plaintiffs lack the financial resources to vigorously prosecute separate lawsuits against large corporate defendants. Class litigation is also superior because it will preclude the need for unduly duplicative litigation resulting in inconsistent judgments pertaining to Defendant’s policies and practices. There do not appear to be any difficulties in managing this class action. 24

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 25 of 46

91.

Plaintiffs intend to send notice to the proposed Rule 23 Class to the extent

required by Fed. R. Civ. P. 23(b)(3). COLLECTIVE ACTION ALLEGATIONS 92.

Plaintiffs bring Counts Two and Three on behalf of themselves and all

individuals similarly situated. The proposed FLSA Collective is defined as: All individuals employed by Defendant as cleaners (including crew leads) in Minnesota within the three years prior to the filing of this Complaint. 93.

Plaintiffs each consent in writing to be a part of this action pursuant to 29

U.S.C. § 216(b). (See Ex. A.) 94.

Plaintiffs and the FLSA Collective are victims of Defendant’s widespread,

repeated, and systematic illegal policies and practices that have resulted in failure to pay minimum wages as required by the FLSA, causing significant damage to Plaintiffs and the FLSA Collective. 95.

Defendant has willfully engaged in a pattern of violating the FLSA in ways

including, but not limited to, failing to pay members of the proposed FLSA Collective the federal minimum wage for all hours worked and failing to pay them one-and-a-half times their regular rate of pay for all hours worked in excess of forty in a workweek. 96.

Defendant’s conduct constitutes a willful violation of the FLSA within the

meaning of 29 U.S.C. § 255. 97.

Defendant is liable under the FLSA for failing to properly compensate

Plaintiffs and others similarly situated, and, as such, notice should be sent to the proposed FLSA Collective. There are numerous similarly-situated current and former employees of

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Defendant who have suffered from the common policies and practices of Defendant, and who would benefit from the issuance of a Court-supervised notice of the present lawsuit and the opportunity to join in the present lawsuit. Those similarly situated employees are known to Defendant and are readily identifiable through Defendant’s payroll and timekeeping records. CAUSES OF ACTION COUNT I—MINIMUM WAGE (Minnesota Fair Labor Standards Act, Minn. Stat. § 177.21, et seq.) On Behalf of Plaintiffs and the Proposed Rule 23 Class 98.

Plaintiffs and members of the proposed Rule 23 Class were or are

employees of Defendants within the meaning of Minn. Stat. §§ 177.23, subd. 7, 177.24. 99.

Defendants were or are employers of Plaintiffs and members of the

proposed Rule 23 Class within the meaning of Minn. Stat. §§ 177.23, subd. 6, 177.24. 100.

Defendant is a large employer within the meaning of Minn. Stat. § 177.24,

subd. 1(a)(1). 101.

After August 1, 2014, Plaintiffs were entitled to be paid no less than $8.00

per hour for each hour they worked for Defendant. Minn. Stat. § 177.24, subd. 1(b) (2014). 102.

Defendant was

prohibited

from

requiring

Plaintiffs

to

purchase

“consumable supplies required in the course of . . . employment” where the cost of those supplies would reduce Plaintiffs’ wages below the minimum wage. Minn. Stat. § 177.24, subd. 4.

26

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 27 of 46

103.

Defendant was prohibited from deducting a lunch break from Plaintiffs’

hours worked in instances where the lunch break is less than twenty minutes, where the employee was interrupted by calls to duty, or where the employee did not actually take the break in question. Minn. Stat. § 177.254; Minn. R. 5200.0120, subp. 4. 104.

Plaintiffs were entitled to compensation at the statutory minimum wage for

all hours worked including travel time between job sites. Minn. R. 5200.0120, subp. 1, 2. 105.

Defendant has violated Minn. Stat. § 177.24 by failing to pay Plaintiffs and

members of the proposed Rule 23 Class wages at a rate of at least $8.00 per hour for all hours worked after August 1, 2014. 106.

Defendant’s actions were willful and not the result of mistake or

inadvertence. See Minn. Stat. § 541.07(5). 107.

As a direct and proximate result of Defendant’s unlawful conduct, Plaintiffs

and members of the proposed Rule 23 Class have suffered damages in an amount to be determined at trial. 108.

Plaintiffs and members of the proposed Rule 23 Class seek damages in the

amount of back pay at the statutorily guaranteed minimum wage for all hours worked, liquidated damages pursuant to Minn. Stat. § 177.27, subd. 8, reasonable attorneys’ fees and costs for this action, pre- and post-judgment interest, injunctive relief, and such other legal and equitable relief as the Court deems proper.

27

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COUNT II—MINIMUM WAGE (Fair Labor Standards Act, 29 U.S.C. § 201, et seq.) On Behalf of Plaintiffs and the Proposed FLSA Collective 109.

At all relevant times, Plaintiffs and others similarly situated were

employees of Defendant within the meaning of 29 U.S.C. § 203(e)(1). 110.

At all relevant times, Defendant was an employer of Plaintiffs and members

of the proposed FLSA Collective within the meaning of 29 U.S.C. § 203(d). 111.

The FLSA, 29 U.S.C. § 206, requires employers to pay minimum wages to

their employees. It provides that Plaintiffs and those similarly situated were to be compensated by Defendant at a rate of no less than $7.25 per hour beginning July 24, 2009. 112.

For an employer to deduct a lunch break from an employee’s hours worked,

the employee must be completely relieved of his or her duties during the break. Thus, an employee must be compensated for any meal break that is interrupted by a request that the employee perform work duties. 29 C.F.R. § 785.18. 113.

Travel from job site to job site must be counted as hours worked. 29 C.F.R.

§ 785.38. 114.

Monies paid to an employee that must be used to purchase supplies

required for the performance of the employer’s particular work are not considered wages for purposes of determining whether an employee has been paid proper minimum wages. 29 C.F.R. §§ 531.32(c); 531.35.

28

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 29 of 46

115.

Prior to August 1, 2014, Defendant agreed to pay Plaintiffs and the

proposed FLSA collective $7.25 per hour. After August 1, 2014, Defendant agreed to pay Plaintiffs and the proposed FLSA Collective $8 per hour. 116.

However, as detailed throughout the Complaint, though Defendant

purported to pay Plaintiffs at a rate at least equal to the federal minimum wage, as a result of Defendant under-reporting Plaintiffs’ hours, deducting time for breaks that were not actually taken or that were compensable, refusing to compensate Plaintiffs for travel time between worksites, requiring Plaintiffs to purchase their own cleaning supplies, and not paying terminated employees for work performed during their last pay period, Defendant failed to pay Plaintiffs and those similarly situated the minimum wage required by the FLSA for all hours worked in violation of 29 U.S.C. § 206. 117.

The foregoing conduct, as alleged, constitutes a willful violation of the

FLSA within the meaning of 29 U.S.C. § 255. 118.

As a direct and proximate result of Defendant’s willful conduct, Plaintiffs

and members of the proposed FLSA Collective have suffered and will continue to suffer damages in an amount to be determined at trial. 119.

Plaintiffs, on behalf of themselves and members of the proposed FLSA

Collective, seek damages in the amount of their unpaid minimum wages for all hours worked, liquidated damages pursuant to 29 U.S.C. § 216, reasonable attorneys’ fees and costs for this action, pre-judgment interest to the extent liquidated damages are not awarded, and such other legal and equitable relief as the Court deems proper.

29

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COUNT III—OVERTIME (Fair Labor Standards Act, 29 U.S.C. § 201, et seq.) On Behalf of Plaintiffs and the Proposed FLSA Collective 120.

At all relevant times, Plaintiffs and others similarly situated were

employees of Defendant within the meaning of 29 U.S.C. § 203(e)(1). 121.

At all relevant times, Defendant was an employer of Plaintiffs and members

of the proposed FLSA Collective within the meaning of 29 U.S.C. § 203(d). 122.

The FLSA, 29 U.S.C. § 207, requires employers to pay non-exempt

employees one and one-half times the regular rate of pay for all hours worked over forty (40) hours per workweek. 123.

As described in the preceding paragraphs, Defendant suffered and

permitted Plaintiffs and the members of the proposed FLSA Collective to routinely work more than forty (40) hours a workweek without paying them overtime compensation. 124.

Plaintiffs and the FLSA Collective are paid on an hourly basis and are not

exempt from the overtime requirements of the FLSA. See 29 U.S.C. § 213. 125.

As the direct and proximate result of Defendant’s unlawful conduct,

Plaintiffs and members of the proposed FLSA Collective have suffered and will continue to suffer a loss of income and other damages in an amount to be determined at trial. 126.

The foregoing conduct, as alleged, constitutes a willful violation of the

FLSA within the meaning of 29 U.S.C. § 255(a). Defendant knew or showed reckless disregard for the fact that its compensation practices were in violation of the FLSA. 127.

Plaintiffs, on behalf of themselves and members of the proposed FLSA

Collective, seek damages in the amount of their unpaid overtime compensation, 30

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 31 of 46

liquidated damages as provided by the FLSA, 29 U.S.C. § 216(b), prejudgment interest to the extent liquidated damages are not awarded, reasonable attorneys’ fees and costs incurred in connection with this claim, and such other legal and equitable relief as the Court deems proper. COUNT IV—OVERTIME (Minnesota Fair Labor Standards Act, Minn. Stat. § 177.21, et seq.) On Behalf of Plaintiffs and the Proposed Rule 23 Class 128.

Plaintiffs and members of the proposed Rule 23 Class were or are

employees of Defendants within the meaning of Minn. Stat. §§ 177.23, subd. 7, 177.24. 129.

Defendants were or are employers of Plaintiffs and members of the

proposed Rule 23 Class within the meaning of Minn. Stat. §§ 177.23, subd. 6, 177.24. 130.

Defendant is a large employer within the meaning of Minn. Stat. § 177.24,

subd. 1(a)(1). 131.

Defendant was required to compensate Plaintiffs at a rate of one-and-one-

half their regular rate of pay for all hours worked in excess of 48 in a workweek. Minn. Stat. § 177.25, subd. 1. 132.

Defendant was prohibited from deducting a lunch break from Plaintiffs’

hours worked in instances where the lunch break is less than twenty minutes, where the employee was interrupted by calls to duty, or where the employee did not actually take the break in question. Minn. Stat. § 177.254; Minn. R. 5200.0120, subp. 4. 133.

Plaintiffs were entitled to compensation for all hours worked including

travel time between job sites. Minn. R. 5200.0120, subp. 1, 2.

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134.

As detailed in the Complaint, by failing to pay Plaintiffs and members of

the proposed Rule 23 Class for all hours worked and failing to pay Plaintiffs at a rate of one-and-one-half times their regular rate of pay for all hours worked in excess of 48, Defendant has violated Minn. Stat. § 177.25. 135.

Defendant’s actions were willful and not the result of mistake or

inadvertence. See Minn. Stat. § 541.07(5). 136.

As a direct and proximate result of Defendant’s unlawful conduct, Plaintiffs

and members of the proposed Rule 23 Class have suffered damages in an amount to be determined at trial. 137.

Plaintiffs and members of the proposed Rule 23 Class seek damages in the

amount of back pay for all unpaid overtime compensation for all hours worked in excess of 48 hours in a workweek, liquidated damages pursuant to Minn. Stat. § 177.27, subd. 8, reasonable attorneys’ fees and costs for this action, pre- and post-judgment interest, injunctive relief, and such other legal and equitable relief as the Court deems proper. COUNT V—UNPAID WAGES (Minnesota Payment of Wages Act, Minn. Stat. § 181.001, et seq.) On Behalf of Plaintiffs and the Proposed Rule 23 Class 138.

Plaintiffs and members of the proposed Rule 23 Class are current and

former employees of Defendant within the meaning of Minn. Stat. §§ 177.23, subd. 7, 181.101. 139.

Defendant at all relevant times was an employer within the meaning of

Minn. Stat. § 181.171, subd. 4.

32

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 33 of 46

140.

Defendant was required by oral agreement to pay Plaintiffs and the

proposed Rule 23 Class for all hours worked. 141.

Minn. Stat. § 181.101 requires every employer to pay “all wages earned”

by an employee at least once every 31 days on a regular payday designated in advance by the employer regardless of whether the employee requests payment at longer intervals and requires the employer to pay a penalty in the amount of the employee’s average daily earnings for up to 15 days if the employer does not make the payment within 10 days of demand. 142.

Minn. Stat. § 181.l3 provides that when an employer discharges an

employee, the wages or commissions actually earned and unpaid at the time of the discharge are immediately due and payable. 143.

Minn. Stat. § 181.14 provides that when an employee quits or resigns

employment, the wages or commissions earned and unpaid at the time the employee quits or resigns must be paid in full no later than the next regularly scheduled payday. 144.

Wages are actually “earned and unpaid” if the employee was not paid for

“all time worked” at the employee’s regular rate of pay or as required by statute, regulation, rule, ordinance, government resolution or policy, contract, or other legal authority. Minn. Stat. §§ 181.13(a), 181.14, subd. 1. 145.

Time worked includes “training time, call time, cleaning time, waiting time,

or any other time when the employee must be either on the premises of the employer or involved in the performance of duties in connection with his or her employment.” Minn. R. 5200.0120, subp. 1. 33

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 34 of 46

146.

Minn. R. 5200.0120, subps. 1, 4 require employers to compensate

employees for all rest breaks of less than 20 minutes and for meal periods in which the employee is not completely freed from his or her duties of employment. 147.

Defendant, pursuant to its policies and practices, refused and failed to pay

Plaintiffs for all of their hours worked, in breach of Defendant’s contractual obligations. 148.

By failing to properly compensate Plaintiffs and members of the proposed

Rule 23 Class for all time worked, Defendant violated, and continues to violate, Plaintiffs’ statutory rights under Minn. Stat. §§ 181.101, 181.13, and 181.14. 149.

Defendant’s actions were willful and not the result of mistake or

inadvertence. See Minn. Stat. § 541.07(5). 150.

Employers who repeatedly and willfully violate Minn. Stat. §§ 181.101,

181.13, and 181.14 “shall be subject to a civil penalty of up to $1,000 for each violation for each employee.” Minn. Stat. § 177.27, subds. 4, 7, 8. Civil penalties assessed under the PWA are payable to the employee. Minn. Stat. §§ 181.101, 181.171, subd. 1. 151.

As a direct and proximate result of Defendant’s unlawful conduct, Plaintiffs

and the proposed Rule 23 Class have suffered damages in an amount to be determined at trial. 152.

Plaintiffs, on behalf of themselves and members of the proposed Rule 23

Class, seek damages in the amount of their earned but unpaid wages for all hours worked, civil penalties for each violation of the PWA, reasonable attorneys’ fees and costs for this action, pre- and post-judgment interest, injunctive relief, and such other legal and equitable relief as the Court deems proper. 34

CASE 0:15-cv-02498 Document 1 Filed 05/20/15 Page 35 of 46

COUNT VI—FAILURE TO PROVIDE EARNINGS STATEMENTS (Minnesota Payment of Wages Act, Minn. Stat. § 181.032) On Behalf of Plaintiffs and the Proposed Rule 23 Class 153.

Plaintiffs and members of the proposed Rule 23 Class are current and

former employees of Defendant within the meaning of Minn. Stat. §§ 177.23, subd. 7, 181.101. 154.

Defendant at all relevant times was an employer within the meaning of

Minn. Stat. § 181.171, subd. 4. 155.

Minn. Stat. § 181.032 requires employers, at the end of each pay period, to

provide each employee with an earnings statement covering the pay period documenting the hours worked, the hourly rate of pay, the list of deductions from the employee’s pay, and the net amount of pay after all deductions are made. An employer who provides earnings statements by electronic means must provide employees access to an employerowned computer during an employee’s regular working hours to review and print earnings statements. 156.

As described throughout the Complaint, Defendant failed to provide

Plaintiffs and the proposed Rule 23 Class earnings statements each pay period. Defendant did not provide Plaintiffs or the proposed Rule 23 Class with electronic access to their paystubs. Each failure to provide an earnings statement at the end of a pay period to an employee constitutes a separate violation of Minn. Stat. § 181.032.

35

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157.

Defendant’s violations of Minn. Stat. § 181.032 were knowing, willful, and

repeated. Plaintiffs made numerous requests to managers and supervisors for copies of earnings statements and were rebuffed in every instance. 158.

Defendant’s actions were willful and not the result of mistake or

inadvertence. See Minn. Stat. § 541.07(5). 159.

Employers who repeatedly and willfully violate Minn. Stat. § 181.032

“shall be subject to a civil penalty of up to $1,000 for each violation for each employee.” Minn. Stat. § 177.27, subds. 4, 7, 8. Civil penalties assessed under the PWA are payable to the employee. Minn. Stat. §§ 181.101, 181.171, subd. 1. 160.

As a direct and proximate result of Defendant’s unlawful conduct, Plaintiffs

and the proposed Rule 23 Class have suffered damages in an amount to be determined at trial. 161.

Plaintiffs, on behalf of themselves and members of the proposed Rule 23

Class, seek damages in the amount of civil penalties for each failure to provide an earnings statement, reasonable attorneys’ fees and costs for this action, pre- and postjudgment interest, injunctive relief, and such other legal and equitable relief as the Court deems proper. COUNT VII—ILLEGAL METHOD OF PAYING WAGES (MFLSA, Minn. Stat. §§ 177.23, subd. 4, 177.255) On Behalf of Plaintiffs and the Proposed Rule 23 Class 162.

Plaintiffs and members of the proposed Rule 23 Class were or are

employees of Defendant within the meaning of Minn. Stat. §§ 177.23, subd. 7, 177.24.

36

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163.

Defendants were or are employers of Plaintiffs and members of the

proposed Rule 23 Class within the meaning of Minn. Stat. §§ 177.23, subd. 6, 177.24. 164.

Under Minn. Stat. § 177.23, subd. 4, Defendant was required to pay

Plaintiffs and members of the proposed Rule 23 Class via cash, check, direct deposit, or electronic fund transfer to a payroll card account that meets the requirements of Minn. Stat. § 177.255. 165.

Defendant’s practice of paying Plaintiffs and members of the proposed Rule

23 Class with debit cards, as described in the Complaint, violates Minn. Stat. § 177.255 because Defendant: (a) does not provide the opportunity to withdraw the net wages for the pay period in a free transaction (subd. 4); (b) does not provide a written disclosure of employees’ payment options (subd. 5); (c) failed to obtain Plaintiffs’ written consent before initiating payments to the debit cards (subd. 6); (d) have repeatedly denied requests for payment of wages through cash or check (Minn. Stat. § 177.23, subd. 4; Minn. Stat. § 177.255, subd. 11); (e) charged fees for use of the payroll cards or, alternatively, selected a payroll card issuer who assessed fees that were not disclosed (Minn. Stat. § 177.255, subds. 12, 13). 166.

Defendant’s actions were willful and not the result of mistake or

inadvertence. See Minn. Stat. § 541.07(5). 167.

As a direct and proximate result of Defendant’s unlawful conduct, Plaintiffs

and members of the proposed Rule 23 Class have suffered damages in an amount to be determined at trial.

37

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168.

Plaintiffs, on behalf of themselves and members of the proposed Rule 23

Class, seek compensatory damages for all fees incurred spending or withdrawing their wages from the debit cards, liquidated damages pursuant to Minn. Stat. § 177.27, subd. 8, all available civil penalties, reasonable attorneys’ fees and costs for this action, pre- and post-judgment interest, injunctive relief, and such other legal and equitable relief as the Court deems proper. COUNT VIII —FAILURE TO MAINTAIN ACCURATE PAYROLL RECORDS (MFLSA, Minn. Stat. § 177.30) On Behalf of Plaintiffs and the Proposed Rule 23 Class 169.

Plaintiffs and members of the proposed Rule 23 Class were or are

employees of Defendant within the meaning of Minn. Stat. §§ 177.23, subd. 7, 177.24. 170.

Defendants were or are employers of Plaintiffs and members of the

proposed Rule 23 Class within the meaning of Minn. Stat. §§ 177.23, subd. 6, 177.24. 171.

Pursuant to Minn. Stat. § 177.30: Every employer…must make and keep a record of: (1) the name, address, and occupation of each employee; (2) the rate of pay, and the amount paid each pay period to each employee; (3) the hours worked each day and each workweek by the employee;

172.

Defendant violated Minn. Stat. § 177.30 by failing to maintain accurate

records of the hours worked each pay period and corresponding amounts paid each pay period for Plaintiffs and members of the proposed Rule 23 Class. 173.

Defendant’s actions were willful, repeated, and not the result of mistake or

inadvertence. See Minn. Stat. § 541.07(5).

38

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174.

As a direct and proximate result of Defendant’s unlawful conduct, Plaintiffs

and members of the proposed Rule 23 Class have suffered damages in an amount to be determined at trial. 175.

Plaintiffs seek damages in the form of injunctive relief, all available civil

penalties, reasonable attorneys’ fees and costs for this action, and such other legal and equitable relief as the Court deems proper. COUNT IX—FLSA RETALIATION (FLSA, 29 U.S.C. § 215) On Behalf of Plaintiff Yusuf 176.

At all relevant times, Plaintiff Yusuf was an employee of Defendant within

the meaning of 29 U.S.C. § 203(e)(1). 177.

At all relevant times, Defendant was an employer of Plaintiff Yusuf within

the meaning of 29 U.S.C. § 203(d). 178.

The FLSA, 29 U.S.C. § 215(a)(3), makes it unlawful for an employer “to

discharge or in any other manner discriminate against any employee because such employee has filed any complaint . . . related to this chapter.” 179.

Plaintiff Yusuf filed an oral complaint under the FLSA by asserting her

right to minimum wage for all of her hours worked and calling for the protection of her rights. 180.

Defendant discharged Plaintiff Yusuf immediately after Plaintiff Yusuf

engaged in this statutorily protected activity.

39

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181.

A causal connection exists between Plaintiff Yusuf’s statutorily protected

activity and her discharge. 182.

As a direct and proximate result of Defendant’s conduct, Plaintiff Yusuf has

suffered and will continue to suffer damages in an amount to be determined at trial. 183.

Plaintiff Yusuf seeks damages in the form of back pay, front pay in lieu of

reinstatement, liquidated damages pursuant to 29 U.S.C. § 216, reasonable attorneys’ fees and costs for this action, pre-judgment interest to the extent liquidated damages are not awarded, post-judgment interest, and such other legal and equitable relief as the Court deems proper. COUNT X—VIOLATION OF MN WHISTLEBLOWER ACT (Minnesota Whistleblower Act, Minn. Stat. § 181.931, et seq.) On Behalf of Plaintiff Yusuf 184.

At all relevant times, Plaintiff Yusuf was an “employee” under Minn. Stat.

§ 181.931, subd. 2. 185.

At all relevant times, Defendant was an “employer” under Minn. Stat. §

181.931, subd. 3. 186.

The Minnesota Whistleblower Act provides that an employer shall not

discharge an employee because she in good faith, reports a violation, suspected violation, or planned violation of any federal or state law to an employer. 187.

Plaintiff Yusuf in good faith reported Defendant’s violations of the PWA,

MFLSA, and FLSA to her employer.

40

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188.

As described in the Complaint, Defendant, acting through its district

manager Rudy Hanuman, discharged Plaintiff Yusuf because she reported the abovementioned violations of state and federal law to her employer. 189.

Defendant’s actions violated Minn. Stat. § 181.932, subd. 1(1).

190.

As a result of Defendant’s conduct, Plaintiff Yusuf has suffered damages in

an amount to be determined at trial. 191.

Plaintiff Yusuf seeks damages in the form of back pay, front pay in lieu of

reinstatement, emotional distress, reasonable attorney’s fees, costs, and disbursements for this action, pre- and post-judgment interest, and such other legal, equitable, and injunctive relief as the court deems fit. COUNT XI—OVERTIME (Fair Labor Standards Act, 29 U.S.C. § 201, et seq.) On Behalf of Plaintiff Quevedo 192.

The FLSA, 29 U.S.C. § 207, requires employers to pay their employees for

hours worked in excess of forty (40) in an individual work week at a rate no less than one and one-half times their regular hourly rate of pay. 193.

While working as an area manager, Plaintiff Quevedo routinely worked in

excess of forty hours in a workweek. 194.

While working an area manager, Plaintiff Quevedo was paid a fixed salary

and was classified as exempt from the overtime pay requirements of the FLSA. 195.

Based on the labor Plaintiff Quevedo performed as area manager, Plaintiff

Quevedo did not fit under any of the exemptions to the FLSA’s overtime pay

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requirements and was therefore eligible to receive overtime compensation for hours worked in excess of forty (40) in a workweek. 29 U.S.C. §§ 207, 213. 196.

By failing to pay Plaintiff Quevedo overtime compensation when he was

working as an area manager, Defendant violated Plaintiff’s statutory rights under the FLSA, 29 U.S.C. § 207. 197.

The forgoing conduct, as alleged, constitutes a willful violation of the

FLSA within the meaning of 29 U.S.C. § 255. 198.

As the direct and proximate result of Defendants’ unlawful conduct,

Plaintiff Quevedo has suffered damages in an amount to be determined at trial. 199.

Plaintiff Quevedo seeks damages in the amount of his unpaid overtime

compensation, liquidated damages as provided by the FLSA, 29 U.S.C. § 216(b), prejudgment interest to the extent liquidated damages are not awarded, reasonable attorneys’ fees and costs incurred in connection with this claim, and such other legal and equitable relief as the Court deems proper. PRAYER FOR RELIEF WHEREFORE, Plaintiffs, individually and on behalf of the proposed Rule 23 Class, pray for relief as follows: A.

Certification of the proposed Rule 23 Class pursuant to Fed. R. Civ. P. 23, for designation of Plaintiffs as class representatives, and for designation of Plaintiffs’ counsel as class counsel;

B.

Judgment that Defendant violated Minn. Stat. § 177.24 by failing to pay Plaintiffs and members of the proposed Rule 23 Class minimum wage for all hours worked;

42

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C.

Judgment that Defendant violated Minn. Stat. § 177.25 by failing to pay Plaintiffs and members of the proposed Rule 23 Class overtime compensation for all hours worked in excess of 48 per week;

D.

Judgment that Defendant violated Minn. Stat. §§ 181.101, 181.13, and 181.14 by failing to pay Plaintiffs and members of the proposed Rule 23 Class all of their earned wages;

E.

Judgment that Defendant violated Minn. Stat. § 181.032 by failing to provide Plaintiffs and members of the proposed Rule 23 Class earnings statements at the end of each pay period;

F.

Judgment that Defendant violated Minn. Stat. §§ 177.23, subd. 4, 177.255 by utilizing an illegal payment method to pay the wages of Plaintiffs and members of the proposed Rule 23 Class;

G.

Judgment that Defendant violated Minn. Stat. § 177.30 by failing to maintain complete and accurate payroll and timekeeping records;

H.

A preliminary and permanent injunction against Defendants and their directors, officers, owners, agents, successors, employees and representatives, and any and all persons acting in concert with them, from engaging in each of the unlawful practices, policies, customs, and usages set forth herein;

I.

An award to Plaintiffs and all members of the proposed Rule 23 Class of compensatory damages, liquidated damages, civil penalties of up to $1,000 for each violation of the PWA, and pre- and post-judgment interest;

J.

An award of reasonable attorneys’ fees and all costs and disbursements incurred in the prosecution of this action pursuant to Minn. Stat. §§ 177.27, subd. 10, 181.171; and

K.

For all such further relief as the Court deems equitable and just.

WHEREFORE, Plaintiffs, on behalf of themselves and the proposed FLSA Collective, pray for relief as follows: A.

Designation of this action as a collective action on behalf of the FLSA Collective and prompt issuance of notice pursuant to 29 U.S.C. § 216(b) to all similarly situated members of the FLSA Collective apprising them of the 43

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pendency of this action, and permitting them to assert timely FLSA claims in this action by filing individual consent forms pursuant to 29 U.S.C. § 216(b); B.

An award of Plaintiffs’ and the similarly situated employees’ unpaid back wages at the applicable minimum wage and overtime rates;

C.

A finding that Defendant’s violations of the FLSA were willful;

D.

An award in an amount equal to Plaintiffs’ and the similarly situated employees’ unpaid back wages as liquidated damages pursuant to 29 U.S.C. § 216(b);

E.

An award of reasonable attorneys’ fees and costs incurred in prosecuting this claim pursuant to 29 U.S.C. § 216(b);

F.

An award of pre-judgment interest (to the extent liquidated damages are not awarded for Defendant’s violations of the FLSA) and post-judgment interest;

G.

Leave to add additional plaintiffs by motion, the filing of written consent forms, or any other method approved by the Court;

H.

All such other legal and equitable relief available pursuant to applicable law; and

I.

For all such further relief as the Court deems equitable and just.

WHEREFORE, Plaintiff Yusuf prays for relief as follows: A.

Judgment against Defendant, finding that it violated 29 U.S.C. § 215(a)(3) by discharging Plaintiff Yusuf because she filed a complaint related to violations of the FLSA;

B.

Judgment against Defendant, finding that it violated Minn. Stat. § 181.932 by discharging Plaintiff Yusuf because she in good faith reported violations of state and federal law;

C.

An award of back pay and front pay in lieu of reinstatement pursuant to 29 U.S.C. § 216(b) and Minn. Stat. § 181.935;

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D.

An award in an amount equal to Plaintiff Yusuf’s back pay and front pay in lieu of reinstatement as liquidated damages pursuant to 29 U.S.C. § 216(b);

E.

An award of reasonable attorneys’ fees and costs incurred in prosecuting this claim pursuant to 29 U.S.C. § 216(b) and Minn. Stat. § 181.935;

F.

An award of pre-judgment interest (to the extent liquidated damages are not awarded for Defendant’s violations of the FLSA) and post-judgment interest;

G.

For all such other legal and equitable relief available pursuant to applicable law; and

H.

For all such further relief as the Court deems equitable and just.

WHEREFORE, Plaintiff Quevedo prays for relief as follows: A.

Judgment that Defendant violated 29 U.S.C. § 207 by designating Plaintiff Orantes as exempt from the overtime provisions of the FLSA while he was working in the position of area manager and by failing to pay him overtime for hours worked in excess of forty in an individual workweek;

B.

An award of Plaintiff Quevedo’s unpaid back wages at the applicable overtime rates;

C.

A finding that Defendant’s violations of the FLSA were willful;

D.

An award in an amount equal to Plaintiff Quevedo’s unpaid overtime compensation as liquidated damages pursuant to 29 U.S.C. § 216(b);

E.

An award of reasonable attorneys’ fees and costs incurred in prosecuting this claim pursuant to 29 U.S.C. § 216(b);

F.

An award of pre-judgment interest (to the extent liquidated damages are not awarded for Defendant’s violations of the FLSA) and post-judgment interest;

G.

For all such other legal and equitable relief available pursuant to applicable law; and

H.

For all such further relief as the Court deems equitable and just. 45

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Dated: May 20, 2015

NICHOLS KASTER, PLLP /s/Adam W. Hansen________________ Adam W. Hansen, MN Bar No. 0391704 Carl F. Engstrom, MN Bar No. 396298 Paul J. Lukas, MN Bar No. 22084X 4600 IDS Center 80 South Eighth Street Minneapolis, MN 55402 Phone: (612) 256-3207 Fax: (612) 338-4878 [email protected] [email protected] [email protected]

ATTORNEYS FOR PLAINTIFFS, THE PROPOSED RULE 23 CLASS, AND THOSE SIMILARLY SITUATED

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