Fifth Circuit Shakes Up Standard For Certifying FLSA Collective Actions

Highlights

• The U.S. Court of Appeals for the Fifth Circuit has issued a potentially landmark decision in Swales v. KLLM Transport Services, L.L.C., emphasizing that district courts should use their litigation-management authority early in litigation to prevent the circulation of notice in Fair Labor Standards Act (FLSA) collective actions from being used to stir up unwarranted litigation.
• In Swales, the Fifth Circuit recognized that the routine sending of notice to a broad group of current and former employees, often deferring consideration of an employer's evidence and arguments until the decertification stage, carried the unintended consequence of stirring up litigation and was often used by plaintiffs to create settlement leverage.