Continued Evolution in the Standards for Conditional Certification of FLSA and ADEA Claims

This blog often focuses on traditional, opt-out class actions brought under Federal Rule of Civil Procedure 23, but there is another common form of mass action: collective actions under the Fair Labor Standards Act and the Age Discrimination in Employment Act. More than 5,000 collective action lawsuits are filed each year under the FLSA and ADEA, making those claims among the most popular forms of mass action and worthy of continued attention.

The FLSA and ADEA allow for aggregate litigation by providing that claims can be brought by employees on behalf of themselves and “other employees similarly situated.”¹ Unlike opt-out class actions under Rule 23, however, the FLSA and ADEA expressly provide that an employee will not become a party plaintiff unless he or she files a consent with the court to “opt in” to the case. The statutes themselves do not define what it means to be “similarly situated” and provide courts with no guidance for determining when employees are sufficiently similarly situated to litigate their claims together. However, to keep the opt-in process efficient, the Supreme Court has held that district courts have discretion to “facilitate[e] notice to potential plaintiffs.”²

For decades, to determine whether employees are similarly situated, district courts across the country have generally adopted a two-step process credited to the District of New Jersey’s 1987 decision in Lusardi v. Xerox Corp.³ The first step occurs shortly after the filing of the complaint, when the plaintiffs move for “conditional certification” and request that the court authorize the plaintiffs to send notice of the case to potential collective action members. Courts have long applied an extremely low bar for plaintiffs to obtain conditional certification and send that notice — generally, an affidavit or two from the plaintiffs will suffice, and courts regularly decline to consider any countervailing evidence offered by the defendant. Later in the case, at step two, the courts apply a more stringent standard in revisiting the preliminary determination as to whether the plaintiffs are similarly situated. This second step is more akin to class certification under Rule 23, albeit under a potentially more lenient standard.

Over the years, a number of federal courts of appeals either expressly or impliedly adopted the two-step approach.⁴ However, as the number of FLSA collective actions has increased, so too has scrutiny over the fairness of a lenient conditional certification standard. As one might expect, once notice is sent to potential class members, the claims against the defendant rapidly accumulate. This creates substantial settlement pressure regardless of the merits of the case.⁵ Just as with Rule 23 class actions, conditional certification “can rachet liability to potentially ruinous levels and force companies to settle or bet the store.”⁶ But a class action must meet the strict Rule 23 requirements before that possibility is implicated. Not so with collective actions under the two-step certification model.

As a result, some courts have recently jettisoned the lenient approach. First, in 2021 the Fifth Circuit in Swales v. KLLM Transport Services, LLC held that a court must authorize discovery and rigorously consider all the evidence before determining whether employees are similarly situated and authorizing any notice.⁷ Two years later, in Clark v. A&L Homecare and Training Center, LLC, the Sixth Circuit rejected a lenient conditional certification standard and instead held that the plaintiffs must show a “strong likelihood” that the to-be-noticed employees are similarly situated to the named plaintiffs.⁸

Despite these back-to-back decisions, district courts outside of the Fifth and Sixth Circuits have been hesitant to stray from the two-step certification model and its lenient conditional certification standard. Both the Eastern and Western Districts of North Carolina, for example, have issued decisions declining to adopt Swales or Clark based on the long-running use of the two-step model in the Fourth Circuit.⁹

This month, the Seventh Circuit in Richards v. Eli Lilly & Co. became the third court of appeals to offer a new interpretation of the two-step certification model, opting for a “middle ground” between Lusardi’s modest standard and the more demanding tests established in Swales and Clark.¹⁰ In Richards, the Seventh Circuit recognized that Lusardi’s lenient standard has been difficult to apply and has created undue pressure for defendants to settle early. Nevertheless, the court concluded that requiring plaintiffs to prove they are similarly situated by a preponderance of the evidence (as the Fifth Circuit did in Swales) would be inappropriate because plaintiffs often lack access to evidence at the conditional certification stage that would be necessary to carry such a burden.¹¹ Likewise, the panel concluded that requiring plaintiffs to show a “strong likelihood of similarity” (as the Sixth Circuit did in Clark) is impracticable because evidence supporting that showing “is in the hands of individuals who are not yet parties to the action.”¹²

Instead, the court settled on an alternative test that aims to resolve these information asymmetries and provide district courts with more flexibility. The panel held that, to secure notice, a plaintiff must first make a “threshold showing that there is a material factual dispute as to whether the proposed collective is similarly situated.”¹³ That means the plaintiff must “produce some evidence suggesting that they and the members of the proposed collective action are victims of a common unlawful employment practice or policy.”¹⁴ The district court must then independently assess the evidence submitted by both parties and determine — in its discretion — whether facilitating notice is appropriate. Alternatively, if the district court believes that the evidence necessary to resolve the question of similarity is in the hands of yet-to-be-noticed opt-ins, the district court may proceed with a two-step approach whereby it issues notice while postponing the similarly situated determination and then makes that determination upon a later certification motion.¹⁵

Although the Fifth, Sixth, and Seventh circuits have all now issued opinions in the last five years that reject Lusardi’s modest conditional certification standard, it remains to be seen whether that trend will catch on in the Fourth Circuit or whether district courts here will continue applying the Lusardi framework until commanded otherwise.

¹ 29 U.S.C § 216(b).
² Hoffmann-La Roche v. Sperling, 493 U.S. 165, 169 (1989).
³ Lusardi v. Xerox Corp., 118 F.R.D. 351 (1987).
⁴ See, e.g., Campbell v. City of Los Angeles, 903 F.3d 1090, 1109 (9th Cir. 2018); Myers v. Hertz Corp., 624 F.3d 537, 554-55 (2d Cir. 2010); Thiessen v. Gen. Elec. Capital Corp., 267 F.3d 1095, 1105 (10th Cir. 2001).
⁵ Bigger v. Facebook, Inc., 947 F.3d 1043, 1049 (7th Cir. 2020) (observing that collective actions present “the opportunity for abuse of the collective-action device: plaintiffs may wield the collective-action format for settlement leverage,” and that “expanding the litigation with additional plaintiffs increases pressure to settle, no matter the action’s merits”).
⁶ Stafford v. Bojangles’ Restaurants, Inc., 123 F.4th 671, 678 (4th Cir. 2024). Robinson Bradshaw represents Bojangles’ in this matter.
⁷ Swales v. KLLM Transp. Servs., LLC, 985 F.3d 430, 441-43 (5th Cir. 2021).
⁸ Clark v. A&L Homecare & Training Ctr., LLC, 68 F.4th 1003, 1011 (6th Cir. 2023).
⁹ Andrews v. Bojangles Opco, LLC, No. 3:23-cv-593, 2024 WL 4154825, at *2-3 (W.D.N.C. Sept. 11, 2024); Johnson v. PHP of NC, Inc., No. 5:23-cv-462, 2024 WL 2290590, at *2-4 (E.D.N.C. May 21, 2024).
¹⁰ Richards v. Eli Lilly & Co., No. 24-2574, 2025 WL 2218500, at *1 (7th Cir. Aug. 5, 2025).
¹¹ See id. at *6 (“In such cases, this heightened requirement for notice functions as an insurmountable barrier for even meritorious collective actions.”).
¹² Id.
¹³ Id. at *7.
¹⁴ Id.
¹⁵ Id.