At a Glance
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The growing divergence among the U.S. Circuit Courts of Appeal—ranging from those following the lenient “two-step” framework first endorsed in Lusardi to the more rigorous evidentiary thresholds articulated by the Fifth, Sixth, and Seventh Circuits—has created substantial uncertainty for employers and employees navigating collective action litigation.
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Four different approaches for determining whether a named plaintiff in a collective action is “similarly situated” to the employees they seek to represent now exist across seven different circuits.
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The defendant-petitioner’s intent to appeal the Ninth Circuit’s ruling in Harrington v. Cracker Barrel based on this conflict represents a rare opportunity for the U.S. Supreme Court to opine on the appropriate standard.
The Fair Labor Standards Act (FLSA) provides a framework for how employees are compensated under federal law. In addition to establishing minimum wage and overtime standards, among other things, the FLSA allows employees to bring “collective” actions “for and on behalf of themselves and other employees similarly situated.” 29 U.S.C. 216(b). Notably, Section 216(b) applies to claims under the FLSA, the Age Discrimination in Employment Act (ADEA), and the Equal Pay Act. Despite this provision being law for more than 75 years, federal courts have largely been left to their own devices to develop and apply an appropriate framework to determine when a court may authorize notice in a Section 216(b) collective action to “similarly situated” employees, who must give written consent if they wish to “opt in” to the collective action.
As a result, several divergent standards for evaluating motions seeking authorization to send notice have emerged. Indeed, no fewer than four different frameworks have been endorsed by U.S. Circuit Courts of Appeal. However, the recent Ninth Circuit decision in Harrington v. Cracker Barrel may finally provide the vehicle for the U.S. Supreme Court to resolve this multi-circuit split and provide clear guidance on the correct framework to be applied. Notably, after the Ninth Circuit’s July 1, 2025, decision declining to adopt the more rigorous standard for notice articulated by the Fifth Circuit, and its subsequent refusal to rehear the matter en banc, Cracker Barrel filed a motion asking the Ninth Circuit to stay its mandate while it sought review by the U.S. Supreme Court. The Ninth Circuit granted Cracker Barrel’s stay request on August 19, 2025.
Given the considerable split among the circuits, there is a real possibility that the U.S. Supreme Court will take up the decision and finally do what the FLSA itself fails to do – articulate the standard to be applied to a request to authorize notice in a collective action under Section 216(b) and provide important guidance to the district courts and the parties in the thousands of putative collective actions filed each year.
The Long Accepted “Two-Step” Approach for “Conditional Certification”
When analyzing whether the named plaintiff in a putative collective action may send court-authorized notice of the action to other employees, district courts must evaluate whether there are other alleged “similarly situated” employees subject to a common policy or plan that violates the FLSA. Lacking guidance from the FLSA or the U.S. Supreme Court, many district courts have followed an approach first articulated nearly 40 years ago by the U.S. District Court for the District of New Jersey in Lusardi v. Xerox Corp., 118 F.R.D. 351 (D.N.J. 1987). Under the so-called Lusardi “two step” approach, a court analyzes the plaintiff’s allegations and evidentiary submission to determine whether the proposed named plaintiff and members of the proposed collective are “similarly situated” such that a collective should be “conditionally certified” and notice issued. Many district courts described the first step in this two-step framework as having a “low” or “lenient” standard – one that could, in certain cases, be satisfied merely by the plaintiff’s reference to the four corners of his complaint and a self-serving affidavit or declaration. To make matters worse for employers, some district courts have declined to consider contrary evidence presented by defendants in opposing notice showing that the putative collective members were, in fact, not similarly situated.
Such an approach not only leads to the formation of large collectives of party-plaintiffs who join the case following notice, but it also places defendants in the position of having to wait until after expensive, disruptive, and time-consuming post-conditional certification discovery to seek to present its evidence to the district court in an effort to “decertify” the conditionally certified collective by showing that the putative collective members were not, in fact, “similarly situated.” Many courts have, in turn, recognized that this process, exacerbated by an often lenient notice standard, has resulted in placing significant pressure on defendants to settle cases after conditional certification, rather than incur the costs necessary to ultimately seek to decertify a collective action.1
Significantly, in the years following Lusardi, the Second, Ninth, Tenth, and Eleventh Circuits endorsed the use of a “two-step” approach.2
The Pendulum Swings with the Fifth Circuit’s Decision in Swales
In January 2021, after decades of employer challenges to the two-step procedure, the Fifth Circuit became the first court of appeals to outright reject it, in Swales, 985 F.3d at 434. There, the Fifth Circuit held that district courts have a duty to “consider all of the available evidence” before issuing notice to potential collective members. Thus, district courts in the Fifth Circuit are now empowered to move beyond the bare allegations of the pleadings to consider all evidence presented when ruling on a motion to issue notice in a collective action and, in doing so, must apply a higher, more rigorous standard than the “lenient” one associated with the two-step framework. In a stark departure from the two-step approach, the Fifth Circuit stressed that district courts should rigorously enforce the FLSA’s “similarly situated” requirement at the outset of litigation. As such, parties must be allowed sufficient discovery to fully analyze whether the putative collective members are, in fact, “similarly situated,” before the court may authorize the issuance of notice to other employees.
The Sixth Circuit Similarly Rejects the Two-Step Approach in Clark
In May 2023, the Sixth Circuit became the second federal appeals court to heighten the standard in Clark, 68 F.4th 1003. In Clark, the Sixth Circuit held that a plaintiff must demonstrate a “strong likelihood” that members of the notice group are similarly situated to the plaintiff for a district court to grant certification and authorize notice to the collective. Indeed, the Sixth Circuit directly rejected Lusardi, as well as use of the term “conditional certification.” The court reasoned that authorizing notice in a collective action is comparable to a provisional decision of whether to grant a preliminary injunction, specifically with respect to the standard’s fourth element: a strong likelihood of success on the merits. In so doing, the Sixth Circuit explained that its “strong likelihood” standard requires a showing greater than necessary to create a genuine issue of fact (as in opposing summary judgment), but less than necessary to show a preponderance of the evidence. Moreover, in applying this standard, district courts were directed to expedite their decision to the extent practicable (given the FLSA’s presumptive two-year statute of limitations). To that end, a district court in the Sixth Circuit may promptly authorize discovery relevant to a motion to provide notice.
The Seventh Circuit Rejects the “Lenient” Two-Step Approach, But Declines to Endorse the More Stringent Fifth and Sixth Circuit Approaches
In Richards, 2025 WL 2218500, the Seventh Circuit adopted its own “flexible” standard. In doing so, it expressly rejected the two-step approach articulated in Lusardi, but also declined to adopt the more rigorous approaches outlined by the Fifth and Sixth Circuits, creating instead its own “middle-ground” approach to the issue. The Seventh Circuit’s framework requires plaintiffs to “make a threshold showing that there is a material factual dispute as to whether the proposed collective is similarly situated.” The court explained that this threshold showing must include “some evidence” from the plaintiff(s) “that they and the members of the proposed collective are victims of a common unlawful employment practice or policy.” Importantly, the Seventh Circuit also held that district courts must consider rebuttal evidence from defendants in evaluating whether plaintiffs met their burden.
The Ninth Circuit Recently Reaffirmed its Endorsement of the Two-Step Process
After first endorsing the use of the “two-step” approach in Campbell v. City of Los Angeles, 903 F.3d 1090, 1108-10 (9th Cir. 2018), the Ninth Circuit waded back into this controversy in Harrington v. Cracker Barrel and reiterated its support for that approach. 142 F.4th 678 (9th Cir. 2025).
The named plaintiffs in Cracker Barrel brought a putative collective action under the FLSA alleging that Cracker Barrel failed to properly apply tip credits and underpaid wages to current and former tipped employees. The U.S. District Court for the District of Arizona applied the two-step framework and granted conditional (or “preliminary” certification) and permitted notice to be sent to putative collective members (including those subject to arbitration agreements with class and collective action waivers) over Cracker Barrel’s objection.
Cracker Barrel appealed the district court’s order and, among other issues, addressed the propriety of the two-step certification process. The Ninth Circuit, however, affirmed the district court’s use of the two-step framework, citing its earlier endorsement of that approach in Campbell. In doing so, it expressly declined to adopt the Fifth Circuit’s more stringent one-step approach from Swales, reasoning that case management decisions in FLSA actions are within the district court’s discretion. Cracker Barrel then sought, but was denied, a rehearing by the full appellate panel.
Is There a Potential Resolution on the Horizon?
In an interesting twist, though, on August 14, 2025, Cracker Barrel filed a Motion to Stay Mandate Pending Petition for Certiorari. In its Motion to Stay, Cracker Barrel asked the Ninth Circuit to stay its mandate to allow Cracker Barrel to file a petition for writ of certiorari to the U.S. Supreme Court seeking a review of the Ninth Circuit’s decision. Specifically, Cracker Barrel argued that the four varied approaches to the certification of collective actions under Section 216(b) warrants Supreme Court review.
The Ninth Circuit granted Cracker Barrel’s stay request on August 19, 2025. Cracker Barrel’s petition for a writ of certiorari is due to the U.S. Supreme Court on November 6, 2025, and will be closely watched to see if the Supreme Court will finally weigh in on the proper standard to be applied by the district courts in determining whether to authorize notice to be sent to putative collective members in Section 216(b) collective actions.
Footnotes
1 See Swales v. KLLM Transport Services, LLC, 985 F.3d 430, 442 (5th Cir. 2021) (observing that, as a result of lenient standards for notice, “collective actions also pose dangers [] for the opportunity for abuse (by intensifying settlement pressure no matter how meritorious the action”) Richards v. Eli Lilly & Co., Case No. 24-257, 2025 WL 2218500 at *3 (7th Cir. Aug. 5, 2025) (notice “matters greatly to defendants, who worry that overly permissive notice standards will allow plaintiffs to artificially expand the size of a collective, ‘increas[ing] pressure to settle, no matter the action’s merits’” and “can transform what should be a neutral case management tool into a vehicle for strongarming settlements and soliciting claims”) (quoting Bigger v. Facebook, 947 F.3d 1043, 1049) and citing Swales 985 F.3d at 442); Clark v. A&L Homecare & Training Ctr., LLC, 68 F.4th 1003 (6th Cir. 2023) (“the decision to send notice of an FLSA suit to other employees is often a dispositive one, in the sense of forcing a defendant to settle—because the issuance of notice can easily expand the plaintiffs’ ranks a hundredfold...”).
2 See, e.g., Myers v. Hertz Corp., 624 F.3d 537, 554–55 (2d Cir. 2010); Campbell v. City of Los Angeles, 903 F.3d 1090, 1108-10 (9th Cir. 2018); Thiessen v. Gen. Elec. Cap. Corp., 267 F.3d 1095, 1105 (10th Cir. 2001); Hipp v. Liberty Nat’l Life Ins. Co., 252 F.3d 1208, 1219 (11th Cir. 2001).
