8th Circuit remands document reviewer’s overtime suit

A document review attorney filed suit after the company he worked for rolled out a new policy where the higher overtime pay rate would cease. While the 8th U.S. Circuit Court of Appeals largely affirmed the district court’s summary judgment for the company, the panel revived part of the dispute.

Bruce Cohen was a document reviewer in the Minneapolis office of Consilio, which employs document review attorneys in about 40 states, with 2,500 employees nationally.

Before August 2019, Consilio paid document reviewers a higher rate for overtime. It then changed the overtime policy so that document reviewers no longer received overtime pay. The company explained that all employees would be paid at their base pay rate for all hours worked. The company asserted that document-review work was a professional legal service, thus making it exempt from overtime requirements.

Cohen filed suit in August 2020, claiming that Consilio violated the Fair Labor Standards Act (FLSA). He asserted a nationwide FLSA collective class action for all Consilio document reviewers classified as exempt from the overtime requirements of the FLSA. He alleged that Consilio violated the Minnesota Payment of Wages Act and the Minnesota Wage Theft Act, as well. Cohen requested injunctive relief, liquidated damages, overtime pay, and statutory penalties.

Ultimately, Consilio paid out $256,010.01 to Minnesota licensed attorney document reviewers to cover the overtime wages and liquidated damages. Cohen ended up receiving $3,225.21 in overtime pay and $462 in liquidated damages.

However, Cohen maintained that he was entitled to penalties. He claimed that Consilio should pay out $172,080 in average daily wage penalties under the Minnesota Payment of Wages Act, as well as $42,000 in penalties for both the Minnesota Fair Labor Standards Act and Minnesota Wage Theft Act.

The district court granted Consilio’s motion for summary judgment. Cohen appealed.

The 8th Circuit panel first addressed Bruce Cohen’s claim under the Minnesota Payment of Wages Act. Specifically, it evaluated whether he could seek average daily wage penalties under §§ 181.171 and 181.101. Although employers can be liable for compensatory damages and other appropriate relief under § 181.171, the panel noted that § 181.101(a) expressly gives enforcement authority for penalties solely to the commissioner of Labor and Industry, who may issue a demand for payment on behalf of an employee and collect both unpaid wages and penalties if the employer fails to pay within 10 days. The panel concluded that, where the Legislature intended to authorize employees to seek penalties directly, as in other Minnesota statutes, it did so explicitly. It concluded that only the commissioner, rather than private employees, can recover “average daily wage” penalties under § 181.101.

The panel also rejected Cohen’s claim under the Minnesota Wage Theft Act. Cohen stipulated that he received all of the pay that Consilio owed him. Nor did Cohen point to statutory authority that permits civil penalties under the statute.

However, the panel vacated the district court’s grant of summary judgment against Cohen’s claim under the Minnesota Fair Labor Standards Act, raising “a serious concern about our jurisdiction to decide this issue.” While the panel determined that Cohen’s claim for penalties could become moot if future events demonstrated that this allegedly wrongful behavior was not reasonably expected to recur, it noted that whether this overtime policy was still in place was disputed.

Judge Jane Kelly wrote, “If Consilio’s policy remains, Cohen’s claim for civil penalties may still be viable.”

The panel vacated the district court’s grant of summary judgment, remanding the case to the district court to determine its jurisdiction. The district court will consider $42,000 in civil penalties under the statute.

Also serving on the appellate panel were Judge Jonathan Kobes and Judge Lavenski Smith.