A “Class Action” Requires Plaintiffs Show More Than Workers Were Misclassified

A “Class Action” Requires Plaintiffs Show More Than Workers Were Misclassified

On July 15, 2019, a California court of appeal in McCleery v. Allstate Insurance Co. affirmed a trial court’s order that denied the plaintiffs’ motion to certify their wage and hour lawsuit as a class action. The plaintiffs alleged they were engaged by three service companies to perform inspections for Allstate Insurance and Farmers Group, but that they had been intentionally misclassified as “independent contractors.” They sued the insurers and the service companies jointly, alleging that they had been deprived of minimum wages, overtime, meal and rest breaks, reimbursement of expenses, and accurate wage statements, and in doing so, the defendants also violated the Unfair Competition Law.

Lawsuits alleging that an employer classified its workers as independent contractors rather than employees have been certified as class actions in California. The McCleery court noted, however, that while “common issues predominated” in the case, where a party seeks certification by alleging an employer has consistently imposed a uniform policy or practice on class members, the plaintiffs must “demonstrate that the illegal effects of this conduct can be proven efficiently and manageably within a class setting.”  In this case, the plaintiffs relied heavily on their expert’s analysis, which suffered from numerous deficiencies. The McCleery court found that the plaintiffs’ expert’s anonymous, double-blind survey to prove liability did not render the claims “manageable,” nor had the plaintiffs shown that class treatment of their claims was “superior” to individual actions.