## Facts

- Hourly, nonexempt employees of Federal Express Corporation (FedEx) alleged they were not paid for all time worked.
- Plaintiffs claimed FedEx required uncompensated work during “gap periods,” including time before scheduled shifts, after scheduled shifts, and during unpaid meal or rest breaks.
- Employees received an Employment Handbook and a People Manual that contained express disclaimers stating the documents did not create contractual rights or an employment contract.
- Plaintiffs relied on a People Manual provision stating FedEx’s policy was to compensate employees for all time worked and that employees were not permitted to work “off the clock.”
- Plaintiffs asserted a state-law breach of contract theory that the employment documents and manuals created a uniform contract breached by a nationwide, common practice of unpaid work.
- Plaintiffs moved to certify a nationwide class of hourly, nonexempt employees (excluding California) whose claims were not time-barred.

## Issues

1. Whether Rule 23(b)(3) predominance was satisfied where the proposed nationwide class asserted state-law breach of contract claims implicating multiple states’ contract doctrines.
2. Whether the handbook/manual disclaimers and varying state rules on handbook enforceability required individualized determinations of contract formation and interpretation.
3. Whether breach and damages would require individualized proof of off-the-clock work, employer knowledge or direction, and uncompensated hours that would overwhelm common questions.

## Decision

- The court denied class certification of the proposed nationwide class.
- The court found Rule 23(b)(3) predominance was not met because individualized issues and variations in applicable state contract law would outweigh common issues.
- The court concluded that contract formation and interpretation could not be determined on a classwide basis given express disclaimers and differing state-law standards.
- The court also found individualized inquiries into unpaid work, causation, and damages would require employee-by-employee evidence, creating manageability problems and undermining superiority.

## Legal Principles

- Under Rule 23(b)(3), a class may be certified only if common questions predominate over individualized issues and the class action method is superior for adjudication.
- In a proposed nationwide state-law contract class, differences among states’ contract-formation and interpretation rules can defeat predominance.
- Express handbook/manual disclaimers may preclude or complicate proof of a binding contract, often requiring state-specific analysis.
- When liability and damages depend on individualized proof of uncompensated work time and related circumstances, predominance and manageability are less likely to be satisfied.

## Conclusion

The court refused to certify a nationwide class for a state-law breach of contract claim based on alleged off-the-clock work because varying state contract law, handbook disclaimers, and individualized proof of breach and damages prevented common issues from predominating and made nationwide class treatment impracticable.


Clausnitzer v. Fed. Express Corp., 248 F.R.D. 647 (S.D. Fla. 2008)