Employment Law Class Action Lawsuits Certified at Record Rate in 2019

Author: Robert S. Teachout, XpertHR Legal Editor

January 22, 2020

Employment law class actions were certified at a record rate in 2019, especially in wage and hour cases, according to a report by Seyfarth Shaw that tracks and analyzes class action litigation data. However, employers won slightly more decertification motions at a rate of 58 percent, than in 2018 (52 percent). The 16th Annual Workplace Class Action Litigation Report reviews significant class action rulings involving employment discrimination, wage and hour law, the Employee Retirement Income Security Act (ERISA) and government enforcement.

"Workplace class action litigation evolved over the last decade with the development of new case law precedents, but 2019 saw the plaintiffs' bar achieve the highest levels of class certification ever," said Gerald Maatman, a partner in Seyfarth Shaw's Chicago office.

This increase occurred despite Supreme Court rulings in recent years that favored employers, like Wal-Mart Stores v. Dukes in 2011, Comcast Corp. v. Behrend in 2013, and Epic Systems v. Lewis in 2018, the report noted.

Maatman called certification the "holy grail" that leads to monetizing lawsuits into settlements, and said that plaintiffs' lawyers have come up with ways to counter the Supreme Court rulings.

The report revealed five key trends in 2019:

  1. Class actions in federal courts were certified at the highest rate in the report's 16-year history - 81 percent for wage and hour cases, 65 percent for ERISA cases and 64 percent for employment discrimination.
  2. Federal wage and hour lawsuit filings fell to 6,780 from 7,494 in 2018, the third consecutive year it decreased and the lowest level in the past decade.
  3. Settlement amounts for wage and hour cases skyrocketed by 77.5 percent over the previous year, from $253 million to $449 million. At the same time, government enforcement settlements dropped to $57.5 million in 2019 from $125 million in 2018 and $485 million in 2017.
  4. The Supreme Court issued several key decisions impacting class actions and government enforcement litigation in 2019 that were arguably more pro-business than decisions in past terms.
  5. The #MeToo movement continues to fuel employment litigation in general and workplace class action litigation in particular, with 28 of the Equal Employment Opportunity Commission's 2019 sex discrimination lawsuit filings including sexual harassment claims, and 57 of its 84 Title VII lawsuits based on gender discrimination allegations.

"As the new decade unfolds," Maatman cautioned, "employers should be mindful that this threat is not getting any easier to deal with and compliance activities remain the best and first line of defense to class action risks."