U.S. Supreme Court sides against Tyson Foods, upholds $5.8 million judgment

Tyson Foods will be forced to pay almost $5.8 million in a class action judgment awarded to 3,300 workers with the company’s Storm Lake, Iowa, pork processing plant who claimed they were owed overtime pay for the hours spent putting on and taking off protective gear required for their jobs.

The U.S. Supreme Court ruled in favor of the workers in a 6-2 ruling handed down on Tuesday (March 22).

“We respect the judgment of the US. Supreme Court, and are disappointed with the result,” David Van Bebber, Tyson Foods general counsel, said in a statement. “However, we are also heartened by the divided Court’s consideration and analysis of serious issues affecting the sufficiency of proof required to maintain a class action under the Fair Labor Standards Act. We are studying the opinion and, in particular, the issue of whether damages can be lawfully allocated to ensure that uninjured class members do not recover from the jury’s lump sum award.”

Tyson appealed to the U.S. Supreme Court last year hoping to reverse a lower court ruling on grounds that the case should have never been certified as a class action. The workers first sued Tyson Foods for overtime pay in federal court in 2011. The 8th U.S. Circuit Court of Appeals upheld the judgment award by the lower court in 2014.

The court considered Tyson’s objection to the use of statistics to determine liability and damages. Critics describe such use of statistics as “trial by formula” that violates defendants’ due process rights, instead of assessing each claim individually for the more than 3,000 current and former employees who are suing.

Justice Anthony Kennedy wrote the opinion narrowly following a 1946 Supreme Court precedent that cites plaintiffs can rely on averages in such situations to determine claims under the Fair Labor Standards Act (FLSA).

Kennedy noted that while corporate defendants “may urge adoption of broad and categorical rules governing the use of representative and statistical evidence in class actions, this case provides no occasion to do so.” He said the ruling does not undercut the court’s major 2011 ruling in favor of Wal-Mart Stores which made it harder to bring class action cases.

The court did not address a broader question of whether a class action lawsuit should move forward if the group of plaintiffs includes people who were not injured. The Justices offering dissenting votes were Clarence Thomas and Samuel Alito.

“The District Court thus did not give proper consideration to the significance of variable donning and doffing times. Establishing an FLSA violation across the entire class was impossible without evidence that each employee would have worked over 40 hours per week if donning and doffing time were included. But the District Court did not fully appreciate that this was a critical individual issue that defined Tyson’s liability, and it did not analyze, in any way, whether this issue was susceptible to common proof. As a result, the District Court erred when it certified the class,” Justice Thomas noted in his dissent.

Tyson Foods said prior to the ruling that 70% of the class certified as knife-wielding employers were already receiving a fixed amount pay for the time they spend putting on and taking off protective gear.