Third Circuit decision gives HR leaders more flexibility to resolve wage-and-hour class actions – find out what this means for your compliance strategy
A federal appeals court just made it easier for employers to settle wage-and-hour lawsuits – reshaping class action strategies for HR teams nationwide.
On October 16, 2025, the United States Court of Appeals for the Third Circuit issued a decision in Graham Lundeen v. 10 West Ferry Street Operations LLC d/b/a Logan Inn. The case involved allegations by Graham Lundeen, a former bartender and server at the Logan Inn in Pennsylvania, that the inn’s tip pool was improperly shared with a salaried manager. Lundeen brought the action on behalf of himself and similarly situated employees, alleging violations of the Fair Labor Standards Act (FLSA) and the Pennsylvania Minimum Wage Act (PMWA).
Lundeen filed the suit as a hybrid class and collective action, seeking compensatory damages and liquidated damages under the FLSA and PMWA. The FLSA claim was brought as a collective action under § 216(b), and the PMWA claim as a Rule 23(b)(3) class action. The District Court conditionally certified an FLSA collective and identified a proposed class of 59 individuals, including Lundeen.
The parties reached a settlement agreement in June 2024, with a maximum total payment of $100,000. Of this, $60,000 would be distributed pro rata to all class members who did not opt out, and an additional $5,000 would be shared among the ten individuals who...
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