The Work

January 5, 2011 7:08 PM

Report: Workplace Class Actions Rose in 2010; More of the Same in 2011

Posted by Tom Huddleston Jr.

The seventh annual edition of Seyfarth Shaw's Workplace Class Action Litigation Report has been released, and it reveals an overall boost in employment-related class action litigation over the past year.

The report found that the top ten settlements struck last year in the areas of wage and hour, ERISA, and governmental enforcement class actions combined to total $1.16 billion--the largest one-year figure since Seyfarth Shaw began keeping track. (Download Seyfarth shaw class action here.)

Wage and hour disputes continued to dominate the class action docket with 6,761 filings in 2010, up roughly 10 percent from 2009's 6,120. Employment discrimination cases also saw a notable spike, jumping to 14,559 last year from 13,720 in 2009, or about 6 percent. (Without going into specifics, the report notes that because most wage and hour suits were filed on behalf of groups of employees, their practical effect is greater than the raw numbers show.)

Gerald Maatman, Jr.--the cochair of Seyfarth's class action defense group, who serves as author and editor of the report--noted that even though there were many more discrimination class actions filed last year, companies should remain mindful of wage and hour issues.

"The headline about what went on with employment discrimination is not meant to suggest that anyone running a company, or defending a company, should take their eye off the ball in terms of compliance with payroll laws," Maatman tells The Am Law Daily. "Because that, I think still, is the number one area where most companies are at risk, and where the plaintiffs' class action bar is bringing the cases."

One reason for the spike in new discrimination cases, Maatman says, is that many suits already being litigated have received a lot of attention, causing what he calls "a trickle-down, or copycat, phenomenon effect on filings."

The Velez v. Novartis case--which went before a jury and resulted in one of the largest-ever employment dicrimination class action settlements, at $175 million--was among the highly publicized cases that could have prompted further filings, Maatman says: "So employment discrimination, very much because it's in the news with key rulings, I think, has that phenomenon where it raises the awareness in the minds of people thinking about their own case, or their own situation."

Looking ahead, the report points to three cases on the current Supreme Court docket--Dukes, et al. v. Wal-Mart Stores, Inc.; Concepcion, et al. v. AT&T Mobility; and In Re Baycol--that could offer landmark decisions in the realm of workplace class actions.

For instance, Dukes, in part, raises the question of how much plaintiffs must have in common--under Rule 23 of the federal rules of civil procedure, which governs standards for class action claims--in order to have a class action certified.

Maatman says all three cases could have an impact on Rule 23. "You're going to have three decisions that are going to have a big impact on class action law--in particular on employers, and the way in which cases are structured and litigated and defended," he says. "So it sets the stage for 2011 being a big year in terms of clarification of standards...under Rule 23."

With a another potentially busy year in employment class action litigation looming, and potential changes on the way, Maatman reiterates that he believes class action lawyers, and the companies they defend, should continue to pay close attention to wage and hour issues.

"Going into 2011," he says, "if I'm a business executive, a VP of HR, one of my compliance resolutions for the new year has got to be making sure I'm up to date and compliant with payroll laws--both on a federal and state law basis."

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