In a wage and hour class action suit that was filed in Maryland’s federal district court, bus drivers and bus assistants sued under the Fair Labor Standards Act (“FLSA”), 29 U.S. C. Section 201 et seq., for back-pay, liquidated damages and attorneys’ fees against several bus companies, the Charles County Board of Education (“Board”), and several high level Board administrators, contending they routinely worked beyond 40 hours per week without the payment of overtime. The FLSA is a federal law that establishes guidelines for both the private sector and federal, state and local governments, with respect to minimum wage and overtime pay for certain workers.
Board’s Sovereign Immunity Not Waived
The Board Defendants moved to dismiss on Eleventh Amendment grounds. The Eleventh Amendment immunizes states from suit for money damages or equitable relief unless the immunity is expressly waived. The district court found that Md. Code Ann., Cts & Jud. Proc. Section 5-518 constituted a waiver of the Board’s immunity from suit for up to $100,000; however, the United States Court of Appeals for the Fourth Circuit (“4th Circuit”) reversed the decision. The 4th Circuit’s reversal was based on the determination that the bus drivers’ and assistants’ claims were contractual claims rather than tort in nature, and Section 5-518 does not extend to contract claims. Further clarifying the issue, the court applied the State’s limited waiver of sovereign immunity in contract claims found in Md. Code Ann., State Gov’t. Section 12-201, which the 4th Circuit said did not waive the Board’s immunity in the case because that provision only applies to contract claims in state court that are based on a written contract. As this claim was in federal court and is not based on a written contract, Section 12-201 did not apply, leaving the Board subject to complete immunity of the claims under the 11th Amendment. Companion state wage-hour and wage payment claims were dismissed, as well.
Board Officials Dismissed In Individual Capacity
The drivers and assistants brought the claims against The Board of Education of Charles County, several high-level Board officials in their professional and individual capacity, the Charles County Public School Board, the Board members and several bus contractors. In a lower court hearing, the judge dismissed the actions brought individually against the Board officials, noting that they were acting in their official capacities and not in their individual capacities. The lower court judge recognized that this is not a hard line rule and in certain circumstances, such as when an individual has “operational control” or is the one “calling the shots” with respect to whether or not to pay overtime and that individual is deemed to have a “ financial stake” in the success of the business, then they could be deemed an employer under the FLSA. It should also be noted that not only private sector employers could be found personally liable under the FLSA. Public servants should be aware that if it can be established that they exercised the requisite “operational control” and received a financial benefit from their control, they could also be held personally liable under the FLSA.
The case will now proceed on the merits, if at all, solely against the bus contractor defendants.
PK Law’s Education and Employment Law Group represented the Board Defendants in both the federal district court and the 4th Circuit, and is one of the few groups in Maryland that has experience handling class action wage and hour litigation defense matters brought against both private and public sector employers. For additional information on PK Law’s Employment Law Group click here. For additional information on PK Law’s Education Law Group click here.
This information is provided for general information only. None of the information provided herein should be construed as providing legal advice or a separate attorney client relationship. Applicability of the legal principles discussed may differ substantially in individual situations. You should not act upon the information presented herein without consulting an attorney of your choice about your particular situation. While PK Law has taken reasonable efforts to insure the accuracy of this material, the accuracy cannot be guaranteed and PK Law makes no warranties or representations as to its accuracy.