Class Cert Granted in Rite-Aid Uniform Reimbursement Case

On June 14, 2020, Judge Lucy H. Koh of the United States District Court for the Northern District of California granted Plaintiffs’ motion for class certification in Kristal Nucci, et al. v. Rite Aid Corporation, et al.

Plaintiffs filed this case on March 19, 2019, against Rite Aid Corporation (“Rite Aid”) for failure to indemnify business expenses and failure to reimburse for required uniforms under the California Labor Code.  Plaintiffs alleged that Rite Aid has a company-wide policy requiring store employees to wear “Team Colors,” which included only navy-blue shirts and khaki pants (which must also comply with numerous additional detailed style requirements) while working.  However, Rite Aid does not reimburse its employees for the expense of obtaining their required clothing items.  Because these clothing items are required as a condition of employment, Plaintiffs alleged, they constitute necessary business expenses which must be reimbursed by Rite Aid under California law. Plaintiffs also sought claims for failure to pay minimum wage, failure to furnish accurate wage statements, waiting time penalties, and Private Attorney General Act penalties under California law.

On February 6, 2020, Plaintiffs filed a motion for class certification, seeking to certify the following class:

All non-exempt employees, excluding pharmacists, pharmacy interns, and asset protection agents, working in any Rite Aid store in California at any time from March 13, 2015 through the trial date.

Plaintiffs argued in their motion that Rite Aid has a policy of requiring employees to purchase clothing constituting a uniform, that Rite Aid does not reimburse its employees for the costs and expenses of the uniform, despite Rite Aid’s obligation to do so, and that Plaintiffs provided sufficient evidence of this policy.  Rite Aid’s primary defense was that it provides blue vests as an alternative to the required “Team Colors” uniform and, therefore, is not required to reimburse its employees for purchasing “Team Colors” clothing.  Plaintiffs argued that the case essentially turns on these two common questions, namely, (1) whether Rite Aid’s “Team Colors” of navy-blue tops and khaki-colored bottoms constitute a uniform under California law, and (2) whether Rite Aid, as a matter of practice and policy, provides blue vests as an alternative to the required “Team Colors” uniform, including in a sufficient number to provide to all employees for every shift.  Plaintiffs argue that these common questions render this case appropriate for class treatment.

In its June 14 Order, the Court found that most of Plaintiffs’ claims center on the allegation that members of the class were required to purchase their own uniforms, and that, in order to establish class-wide liability, Plaintiffs needed to be able to provide common, class-wide proof of three things: (1) that the clothing is required by their employer, (2) that the clothing be of a distinct design or color, and (3) that it is not usual and generally usable in the occupation.  The Court found Rite Aid’s commonality and predominance arguments to be unpersuasive, explaining that Plaintiffs’ evidence constitutes significant proof of a common question of whether Plaintiffs were required to purchase clothing as a condition of their employment, which would drive the answer to Plaintiffs’ claims on the first element listed, above.  The Court also found that Plaintiffs presented common evidence of whether Rite Aid’s “Team Colors” policy constitute a uniform under California law.

In rendering its decision on class certification, the Court also denied Rite Aid’s motion to strike the report of Plaintiff’s expert, Dr. Jeffrey S. Peterson, Ph.D., finding that Rite Aid’s challenges to Dr. Peterson’s report and survey evidence go to weight, not admissibility, and, therefore, would not be struck at the class certification stage.

The legal team at SFMS has substantial experience litigating class action employment matters, including reimbursement for business expenses. If you have any questions regarding this subject or this posting, please contact John Roberts (jroberts@sfmslaw.com) or Alec Berin (aberin@sfmslaw.com). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides our firm with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please call us (866) 540-5505 or contact us online.

Author: Jaclyn Reinhart

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