Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Acosta v. Wellfleet Communications, LLC

United States District Court, D. Nevada

February 1, 2018

R. ALEXANDER ACOSTA Secretary of Labor, United States Department of Labor, Plaintiff,
v.
WELLFLEET COMMUNICATIONS, LLC, et al., Defendants.

          ORDER RE: MOTION TO COMPEL (ECF NO. 85)

         This matter is before the Court on Plaintiff's Motion to Compel (ECF No. 85), filed on December 14, 2017. Defendants filed a Motion to Strike (ECF No. 89) on December 21, 2017, and an Opposition to Plaintiff's Motion to Compel (ECF No.95) on December 28, 2017. Plaintiff filed its Opposition to Defendants' Motion to Strike (ECF No. 99) and his Reply in Support of the Motion to Compel (ECF No. 100) on January 4, 2018. The Court conducted a hearing in this matter on January 11, 2018.

         BACKGROUND

         Plaintiff Secretary of Labor, Department of Labor, originally filed this action against Defendants Wellfleet Communications LLC and Allen Roach on October 7, 2016. Complaint (ECF No. 1). The filing of the complaint followed an investigation by the Department of Labor regarding whether Defendants had improperly characterized their call center workers[1] as independent contractors, rather than as employees, and failed to pay them minimum wages and overtime pay as required by federal law. Plaintiff alleges that Defendants operated telemarketing companies that sold long distance telephone products for telephone companies such as AT&T, Verizon and Birch Communications. The call center workers, whom Defendants designated “Direct Sellers, ” conducted telephone sales. Defendants and the call center workers executed written contracts, entitled “Independent Contractor Agreement for Direct Seller, ” which stated that the call center workers were independent contractors and that Defendants would not withhold any federal, state, or other taxes, including income tax, social security tax, FICA, Medicaid and unemployment tax, and that the workers would not be eligible for unemployment benefits. Defendants argue that treatment of the call center workers as independent contractors complied with the Internal Revenue Code, 26 U.S.C. § 3508(a), which states that “[f]or purposes of this title, ” individuals performing services as a “direct seller” shall not be treated as an employee, and the person for whom such services are performed shall not be treated as an employer. Defendants assert that this constitutes a defense to the Plaintiff's action under the FLSA. Defendants also argue that their business was audited by the State of Nevada which approved the “Independent Contractor Agreement for Direct Seller” as a legal operating document.

         Prior to the filing of this lawsuit, Plaintiff's investigator, Alissa Ann, made an estimate of the number of hours worked by 1, 444 call center workers during period from October 15, 2012 to October 16, 2015. This estimate was arrived at through interviews with the workers about their work hours, including time deducted for lunch and other scheduled breaks. The investigator determined that call center workers worked an average of 25.5 hours per week which multiplied by the $7.25 minimum hourly wage results in a weekly minimum wage of $184.88. Plaintiff's investigator requested that Defendants produce records that would show the actual hours worked by call center workers and the amounts paid to them. Exhibit 1 to Motion to Strike (ECF No. 89-1), at 255-260, DOL Investigator's Narrative Report. Defendants state that they did not maintain records regarding the hours worked by the call center workers prior to February 1, 2016 when they reclassified the call center workers as employees, began tracking their work hours, and paying at least the minimum wage for all hours worked. Defendants state that as a result of complying with Plaintiff's demand to treat the call center workers as employees, they were required to lay-off most of the workers and downsize their operations.

         Plaintiff alleges that he is entitled to recover back wages and overtime pay on behalf of the call center workers for the period from October 7, 2012 through February 1, 2016. The statute of limitations period under the FLSA is two years, unless the violation was willful, in which case the limitations period is three years. Plaintiff argues that Defendants' violations of the law were willful and that the three year statute of limitations should apply. Plaintiff also argues that the running of the statute of limitations should be equitably tolled for an additional year because the Defendants prevented the call center workers from asserting their rights to be paid minimum wages and overtime pay. This Court previously found that Plaintiff has sufficiently alleged a factual basis for its claims of willfulness and for equitable tolling to support discovery for the period from October 7, 2012 until February 1, 2016. See Order (ECF No. 75), at 3-5.

         Plaintiff seeks to compel production of the following categories of documents from Defendants: (1) records showing the actual hours worked by call center workers during the subject period; (2) records that show the amounts paid to call center workers, including deductions from their pay; (3) records relating to the ownership and control of the Defendant entities; (4) communications between Defendants and others relating to their position that the call center workers were independent contractors, and not employees; and (4) records relating to the degree of control that Defendants exercised over the call center workers.

         The following requests for production and responses are at issue in this matter:

REQUEST NO 4: All DOCUMENTS, regardless of date created, RELATING TO the CALL CENTER WORKERS' job duties during the SUBJECT TIME PERIOD, including job advertisements, job descriptions, training materials, memoranda, and scripts used by the CALL CENTER WORKERS during calls.
RESPONSE: Defendants believe they have furnished these documents and indeed, in the Secretary's Initial Disclosures, these documents are listed in B(f).
REQUEST NO. 5: All DOCUMENTS, regardless of date created, RELATING TO any monitoring or supervision of the CALL CENTER WORKERS during the SUBJECT TIME PERIOD, including all DOCUMENTS RELATING TO any warning to, or discipline or termination of CALL CENTER WORKERS.
RESPONSE: Defendants believe that if any of these existed, they were given to Plaintiff.
REQUEST NO. 6: PERSONNEL FILES for all CALL CENTER WORKERS who worked for WELLFLEET during the SUBJECT TIME PERIOD.
RESPONSE: Objection on the basis of relevance. Since Defendants only maintained personnel files for its W2 employees, this request is not proportional to the needs of the case, the importance of the issues in this case or the goals of FRCP 1.
REQUEST NO. 7: All DOCUMENTS showing any time worked by any CALL CENTER WORKER during the SUBJECT TIME PERIOD, including but not limited to any Agent Log-in Log-out Report, Talk Time Reports, Daily Hour Sheets, Time Cards, work schedules, sign-in/sign out sheets, time-off request forms, and DOCUMENTS generated by or reflecting data from dialer systems showing the log-in and log-off times of the CALL CENTER WORKERS.
RESPONSE: All documents responsive to this request have been given to Plaintiff. See Section B(i) of the Secretary's Initial Disclosures.
REQUEST NO. 9: All DOCUMENTS showing any payments made, and deductions from those payments (such as chargebacks or cancellations, etc.) to CALL CENTER WORKERS during the SUBJECT TIME PERIOD.
RESPONSE: All documents responsive to this request have been given to Plaintiff. See Section B(g), (h) and (j) of the Secretary's Initial Disclosures.
REQUEST NO. 10: All DOCUMENTS showing any loans made to CALL CENTER WORKERS during the SUBJECT TIME PERIOD and showing any payments made by CALL CENTER WORKERS on those loans.
RESPONSE: Objection on ground of relevance. This request is not proportional to the needs of the case, the importance of the issues in this case or ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.