AT&T wage lawsuit cannot proceed as class-action

By Jonathan Stempel

NEW YORK (Reuters) - AT&T Inc <T.N> won a ruling from a Manhattan federal judge to decertify a class-action lawsuit by more than 4,100 workers who complained its mobile unit failed to properly pay wages and overtime.

The ruling, by U.S. District Judge Jed Rakoff in favor of AT&T Mobility LLC, came two weeks after the U.S. Supreme Court, by a 5-4 vote, upheld the company's ability to require customers to waive their right to class-based arbitrations to resolve disputes, even over small sums.

In the wage case, Gamze Zivali, a Brooklyn, New York resident and assistant store manager, accused AT&T Mobility of requiring her to spend 10 to 15 unpaid hours per week answering e-mails, texts and phone calls, and performing other work.

Rakoff in July 2009 granted "conditional" permission for other AT&T Mobility workers to join the case, and allege they were victims of a "common policy or plan" that violated federal labor laws. More than 4,100 workers joined the case.

But in a decision made public late Thursday, Rakoff said there was "an extremely wide variety of factual and employment settings" among the workers, their managers and retail stores.

"Resolution of the many fact-specific issues in this case would essentially require 4,100 mini-trials," Rakoff wrote. "Such a result is the antithesis of collective action treatment and would overwhelm the judicial system and eliminate any judicial efficiency that might be gained."

The judge denied AT&T Mobility's motion to dismiss the case, saying the evidence suggested that some plaintiffs might be able to recover damages for unpaid overtime. He also said Zivali may pursue her claims at trial.

Lawyers for the plaintiffs did not immediately return requests for comment. AT&T spokeswoman Kate Tellier said the Dallas-based company is pleased with the ruling, and that it complies with all federal and state wage and hour laws.

In a separate case involving class certification, the Supreme Court is expected to decide by the end of June whether a bias lawsuit against Wal-Mart Stores Inc <WMT.N> may proceed as a class action on behalf of a group believed to exceed 1.5 million current and former female workers.

It would be the largest class-action gender bias case in history. Wal-Mart has argued that the claims are too disparate to be joined together in a single lawsuit.

The case is Zivali v. AT&T Mobility LLC et al, U.S. District Court, Southern District of New York, No. 08-10310.

(Additional reporting by Sinead Carew; Editing by Gerald E. McCormick and Steve Orlofsky)