NC Court allows class certification but recommends independent contractors reconsider whether they want to be employees

Map Of North Carolina State 3d ShapeFrom Leagle, in Rehberg v. Flowers Baking Company of Jamestown, LLC, Docket No. 3:12-CV-00596, the court allowed distributors to pursue a class action lawsuit but recommended that the alleged independent contractors reconsider whether they want to be employees.  In the case, the distributors brought a  lawsuit against a producer of packaged bakery foods alleging that they were misclassified as independent contractors instead of employees and were owed overtime for hours worked in excess of 40 hours per week.  The distributors purchased or were otherwise granted distribution rights to Flowers’ products within a geographic area.  The distributors picked up the products, delivered them to stores, stocked shelves, and removed stale products.  Distributors bought their own vehicles.

The distributors determined the type and quantity of products to deliver to each customer are are paid for each product sold by the stores.

The court reviewed the facts and the standard for certifying a class action and concluded that class certification was appropriate.  However, the court recommended that the distributors consider the implications of their decision to want to be employees.  The court said:

“After reviewing the extensive record in this case in relation to the claims pursued here, the court will take this opportunity to note that the distributors seeking employment status through this lawsuit would be well-served to carefully consider the implications of any court decision finding that they are employees within the meaning of the FLSA and NCWHA. If the court determines that all distributors are indeed employees, distributors would essentially exchange their entrepreneurial opportunities and benefits associated with their ownership rights in their distributorships for the right to earn overtime pay and other employee benefits. Put another way, a decision unfavorable to Defendants in the context of this lawsuit may very well wind up to be unfavorable to distributors in the context of their business endeavors, ability to generate profits, and any equity they may have in their distributorships.

Nonetheless, the court has determined that this case’s current disposition renders all of Plaintiffs’ asserted claims appropriate for collective resolution and will therefore allow it to proceed as a class action. Going forward, the court will continue to monitor and assess the feasibility of doing so and will act accordingly if it determines that collective resolution for any reason proves to be improper….”

Read the full court decision at REHBERG v. FLOWERS BAKING COMPANY OF JAMESTOWN, LLC 

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