The U.S. Supreme Court has opted not to intervene in a major legal dispute regarding the reach of federal wage laws. By declining to hear a petition from Cracker Barrel Old Country Store employees, the justices have left a significant “circuit split” intact, meaning the rules for multi-state labor lawsuits will continue to vary depending on where a case is filed.
The Core of the Dispute: Harrington v. Cracker Barrel
The case, Harrington v. Cracker Barrel Old Country Store, began when four employees sued the restaurant chain in an Arizona federal court. They alleged they were improperly paid sub-minimum wages for non-tipped work and forced to work off the clock. While the plaintiffs represented workers from Arizona, Ohio, North Carolina, and Florida, the 9th U.S. Circuit Court of Appeals ruled that the court lacked jurisdiction over the out-of-state residents.
This decision effectively slashed the potential plaintiff pool by 90%, restricting the collective action solely to workers within Arizona.
A Divided Legal Landscape
At the heart of the issue is the Fair Labor Standards Act (FLSA), which governs how workers can join forces to sue for unpaid wages. Federal appeals courts are currently deadlocked on how to handle these “collective actions”:
- The Restrictive View: The 9th Circuit and four other appeals courts argue that unless a company is headquartered in the state where the suit is filed, the court cannot hear claims from out-of-state workers. They cite a 2017 Supreme Court ruling involving Bristol-Myers Squibb to support this limitation.
- The Expansive View: Conversely, the 1st U.S. Circuit Court of Appeals ruled in 2022 that the FLSA was specifically intended to facilitate large-scale actions against national corporations.
Why the Stakes are High
For workers, represented in this case by the Public Citizen Litigation Group, the 9th Circuit’s stance creates a massive hurdle. They argue that forcing employees to file separate, identical lawsuits in every state is a waste of judicial resources. Furthermore, many low-wage workers lack the financial means to pursue individual claims, effectively stripping them of their federal rights.
For businesses, the ruling is a shield against expensive, nationwide litigation often filed in plaintiff-friendly jurisdictions. For now, the Supreme Court’s silence means the geographic lottery of labor law continues.
