Happy Holidays for J.C. Penny: Vacation Benefit Class Decertified

In an early Christmas present for J.C. Penny, U.S. District Judge Jeffrey T. Miller decertified a class of nearly 65,000 J.C. Penny employees who allege that they were deprived of vacation benefits. The class was certified over a year ago. Now, however, the court has found the class to be “unworkable”. The crux of the problem is that the class representatives are former employees who allegedly were denied their vacation pay when they left the company, but the class definition includes current employees and former management employees who had a different set of benefits from non-management employees. Accordingly, the court found the class to be overly broad as currently pleaded and that the named plaintiffs failed “to satisfy the typicality and adequacy requirements.”

The Judge also addressed J.C. Penny’s argument that all non-management employees that started after July 2009 are subject to arbitration agreements and should be excluded from the class (which covers employees employed from April 2007 to December 2014). The court, however, found that those agreements had no bearing on the size of the class – the issue at bar.

Although not required to offer employees paid vacation, J.C. Penny chose to offer benefits, but argues that it was only to be accrued after the expiration of a waiting period. The company previously failed to obtain summary judgment, with the court holding that there was evidence that not every class member received the same policy and that the policy was not clearly explained.

The case is Tschudy v. J.C. Penney Corp. Inc., case number 3:11-cv-01011, in the U.S. District Court for the Southern District of California.

For information about California wage and hour law, contact the experienced Orange County civil attorneys at Ford & Diulio PC at 714-384-5540 or email Jessica Diulio at jdiulio@forddiulio.com.