United States District Court, E.D. Virginia, Richmond Division
RODERICK C. YOUNG, Magistrate Judge.
Plaintiffs Robert Humphries, Jeffrey Liu, and Kevin O'Hara (collectively "Plaintiffs") bring this suit-on behalf of themselves and all other similarly situated individuals-under the Fair Labor Standards Act ("FLSA") against Elite Force Staffing, Inc. ("Elite Staffing") and Steven W. Worrell ("Mr. Worrell") (collectively "Defendants"). Plaintiffs, former temporary employees of Elite Staffing, allege that Defendants illegally withheld overtime pay by structuring Plaintiffs' wages as "time and a half." Plaintiffs bring this action on behalf of themselves and a putative class of employees also allegedly harmed by Defendants. The "Proposed FLSA Collective Action" has not yet been certified, and Defendants have moved to dismiss this action on the basis that this Court lacks jurisdiction. Defendants specifically argue that this Court lacks jurisdiction because Defendants presented Plaintiffs with a valid Rule 68 Offer of Judgment ("Defendants' Offer"), thus mooting any claims that Plaintiffs had. Plaintiffs counter that Defendants' Offer was not valid under Rule 68 and, therefore, that their claims were not rendered moot by Defendants' Offer. Accordingly, Plaintiffs argue that this Court retains jurisdiction over Plaintiffs' claims.
This matter is now before the Court by consent of the parties pursuant to 28 U.S.C. § 636(c)(1) on Defendants' Rule 12(b)(1) Motion to Dismiss Plaintiffs' Complaint (Defs.' Rule 12(b)(1) Mot. to Dismiss Pis.' Compl. ("Defs.' Mot. to Dismiss"), ECF No. 19). Defendants' Motion to Dismiss has been fully briefed and is ripe for review. Having considered the parties submissions, and finding it appropriate to do so, the Court DENIES Defendants' Motion to Dismiss (ECF No. 19) for the reasons set forth below.
A. Plaintiffs' Employment
Elite Staffing operates as a temporary staffing agency that "provid[es] workers to construction contractors at various locations and projects on an as-needed basis." (Collective Action Compl. - Fair Labor Standards Act ("Compl."), ECF No. 1 ¶ 11.) Mr. Worrell is Elite Staffing's owner, president, and director. (Compl. ¶ 8.) Each named Plaintiff worked for Defendants for temporary periods and varying lengths of time between October 2013 and January 2015. (See Compl. ¶¶ 29-43.)
Plaintiffs allege that, during the course of their employment, Defendants paid Plaintiffs under a "Split Pay System, " which Plaintiffs describe as follows. (Compl. ¶¶ 23-27.) Plaintiffs specifically allege that Defendants split Plaintiffs' paychecks into a Tax Portion and a Non-Tax Portion. (Compl. ¶23.) Plaintiffs allege that federal and state taxes were withheld from the Tax Portion, whereas there were no withholdings from the Non-Tax Portion. (Compl. ¶ 25.) For overtime hours, Plaintiffs allege that this Split Pay System resulted in Plaintiffs being paid at one and on-half times their regularly hourly rate on the Tax Portion of their paychecks, but only "straight time" on the Non-Tax Portion of their paychecks. (Compl. ¶26.) Throughout their Complaint, Plaintiffs bring claims for unpaid overtime compensation based on approximate regular hours worked and approximate overtime hours worked. (Compl. ¶¶ 30, 31, 33, 34, 37, 39, 41, 43.)
B. Plaintiffs' Allegedly Underpaid Overtime Work
Mr. O'Hara alleges that, from October to November 2013, he "accru[ed] approximately 80 hours of overtime." (Compl. ¶ 30.) Mr. O'Hara further alleges that, from March to April 2014, he "accrufed] approximately 16 hours of overtime." (Compl. ¶ 33.) Due to Defendants' allegedly illegal Split Pay System, Mr. O'Hara alleges that he "is owed approximately $480 in unpaid overtime wages" for his work in 2013 and "approximately $72 in unpaid overtime wages" for his work in 2014. (Compl. ¶¶ 30-31, 33-34 (emphasis added).)
Mr. Liu alleges that, in January 2015, he "accru[ed] approximately 12.5 hours of overtime." (Compl. ¶ 37 (emphasis added).) Due to Defendants' allegedly illegal Split Pay System, Mr. Liu alleges that he "is owed approximately $62.50 in unpaid overtime wages." (Compl. ¶ 39 (emphasis added).)
Mr. Humphries alleges that, in January 2015, he "accru[ed] approximately 12.5 hours of overtime." (Compl. ¶ 41 (emphasis added).) Due to Defendants' allegedly illegal Split Pay System, Mr. Liu alleges that he "is owed approximately $62.50 in unpaid overtime wages." (Compl. ¶ 43 (emphasis added).)
While Plaintiffs allege approximate damages based on approximations of the overtime hours they worked, Plaintiffs specifically allege that "[t]he exact amount of hours worked by and wages owed to Plaintiffs and similarly situated individuals will only be known through discovery." (Compl. ¶ 20.)
C. Defendants' Rule 68 Offer of Judgment
Defendants argue that "Plaintiffs' Complaint allege[s] specific monetary damages... based on alleged overtime hours." (Defs.' Mem. Supp. Mot. Dismiss Pis.' ...