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News | Jul 12, 2015

NEW YORK FEDERAL JUDGE NIXES FLSA SETTLEMENT

On July 6, 2015, Southern District of New York Judge Analisa Torres issued a very concise opinion rejecting an FLSA settlement because (i) the settlement agreement contained a sweeping confidentiality agreement and required the plaintiff to pay liquidated damages in the event of a breach and (ii) contained release language that extended well beyond wage and hour claims.  The opinion can be found at Flood v. Carlson Restaurants, Inc., 2015 U.S. Dist. LEXIS 88068 (S.D.N.Y. July 6, 2015).  Judge Torres’s opinion is excellent and reflects a growing judicial consensus that confidentiality agreements violate the FLSA’s public policy goal of ensuring that workers remain aware of their wage and overtime rights.  Likewise, the Judge’s concerns regarding the scope of the FLSA release is a breath of fresh air, since too many FLSA lawsuits are being settled with broad releases that have nothing to do with the subject matter of the lawsuit.  Indeed, Middle District of Pennsylvania Chief Judge Christopher Connor recently issued a similar holding in a decision entitled Bettger v. Crossmark, Inc., 2015 U.S. Dist. LEXIS 7213 (M.D. Pa. Jan. 22, 2015).  New York and Pennsylvania wage anmd employment lawyers should be on the lookout for similar decisions in the future.

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