A group of wait staff at a posh New York City restaurant sued their employer, claiming it violated both the federal Fair Labor Standards Act (FLSA) and New York state labor laws in its compensation practices. Specifically, plaintiffs charged that the restaurant made them share tips with employees who were ineligible for tips and failed to pay them an extra hour's minimum wage when they worked more than 10 hours in a day.

What happened. The waiters were former or current employees of Park Avenue Restaurant. And, they charged that they were forced to share their tips with one management employee and many workers who did not provide direct customer service, such as "expediters," dishwashers, coffee makers, and silver polishers.

Furthermore, state labor laws require what's called a "spread of hours" premium for working more than 10 hours in a day. But running suits under both laws simultaneously causes some complexity: Plaintiffs must opt in to an FLSA suit but must opt out of a state lawsuit, which is governed by the Federal Rules of Civil Procedure. Park Avenue argued that the two laws are incompatible for that reason and alleged further that state lawsuit plaintiffs would vastly outnumber FLSA plaintiffs—by as much as 275 to 25.

But a federal district court judge ruled that the two suits could be considered together, primarily because the charges under both were substantially the same. Park Avenue appealed to the 2nd Circuit, which covers Connecticut, New York, and Vermont.

What the court said. Appellate judges agreed with the district judge that the same claims lay behind both lawsuits. They also noted out that at least three other requirements for the state law claims were met: Plaintiffs are numerous enough, they all have the same claims, and the plaintiffs are typical of the entire class. Only ultimate damage awards may differ from plaintiff to plaintiff.

They also said that the waiters' state law claims are "straightforward" and "do not appear to raise a 'novel or complex issue of state law.'" And, their review of FLSA's "savings clause" led them to believe that Congress intended that state wage laws co-exist with FLSA. Judges pointed out that rulings by the 7th (IL, IN, WI), 9th (AK, AZ, CA, HI, ID, MT, NV, OR, WA), and District of Columbia Circuits have also allowed state and federal wage and hour claims to be considered simultaneously. Shahriar et al. v. Park Avenue Restaurant, U.S. Court of Appeals for the 2nd Circuit, No. 10-1884-cv (2011).

Point to remember: Only where "novel and complex" questions of state law arise might judges insist on separating state and federal wage and hour cases.