Federal Court Certifies Overtime Collective Action Against Mississippi Behavioral Health Provider — What Mental Health Workers Need to Know

The Pay Structure at Issue

MBHS is a private community mental health center with sixteen offices across Mississippi. It employs workers it calls "Community Providers" to deliver mental health services to clients, often at clients' homes or via telehealth. Because MBHS is largely funded by Medicaid, which only reimburses for direct client care, the company drew a sharp line between "billable" hours - time spent treating clients - and "nonbillable" hours — time spent on travel, meetings, training, and administrative tasks.

Each week, Community Providers were generally required to complete 30 hours of billable work. The remaining 10 hours were supposed to cover all of their nonbillable duties. Together, this was treated as a 40-hour workweek.

Here is where the problems start. If Community Providers exceeded 30 billable hours, MBHS offered "incentive pay" for each additional billable hour. But the company's policies did not account for the additional nonbillable time those extra billable hours generated, the extra progress notes, travel, and administrative work that naturally followed. Meanwhile, MBHS did not track how many nonbillable hours its employees actually worked. The plaintiffs allege that completing these nonbillable tasks regularly pushed Community Providers past 40 hours per week and that MBHS never paid overtime for any of it.

The Court's Analysis

Certifying an FLSA collective action in the Fifth Circuit is not easy. Under the framework established in Swales v. KLLM Transport Services, LLC, 985 F.3d 430 (5th Cir. 2021), courts must scrutinize whether proposed collective members are actually "similarly situated" to the named plaintiffs from the very beginning of the case. This is a more demanding standard than the old two-step Lusardi approach that many other circuits still follow.

Judge Reeves found the Community Providers cleared that bar. The court walked through several key factors.

First, on job duties, the court found that all Community Providers - regardless of their specific title - performed similar work. They each provided mental health services, scheduled appointments, treated clients, and completed progress notes. They were supervised in the same manner and categorized the same way for pay purposes. MBHS argued that differences in travel distances and weekly hours should defeat certification, but the court rejected that argument, noting that variations in hours worked go to damages, not liability.

Second, on pay policies and practices, the court found that all Community Providers were subject to the same compensation structure. They all faced the 30-billable-hour requirement, the same pay reductions for falling short, and the same incentive pay framework. The plaintiffs alleged that under this common structure, overtime premium pay was never offered or received.

Third, on unpaid overtime, the court addressed MBHS's argument that the plaintiffs could not prove they worked overtime because they lacked records showing exact hours. The court turned this argument on its head: it is the employer's burden to maintain accurate records, and employees should not be penalized for an employer's failure to do so. The court cited the Supreme Court's reasoning in Tyson Foods, Inc. v. Bouaphakeo - when an employer fails to keep adequate records, plaintiffs may use representative evidence to fill the evidentiary gap.

Finally, the court addressed MBHS's claim that many Community Providers were exempt from overtime as "learned professionals." The court was unconvinced. To qualify for that exemption, an employee must meet a duties test, an income threshold, and be paid on a salary basis. The plaintiffs cast significant doubt on the salary-basis element. Under the Supreme Court's decision in Helix Energy Solutions Group, Inc. v. Hewitt, 598 U.S. 39 (2023), a true salary must be a predetermined amount that does not change based on how many days or hours an employee works. The plaintiffs pointed out that Community Providers' pay was subject to reductions when they did not hit their billable hour targets - which is the opposite of how a salary is supposed to work. The court found these questions could be resolved collectively rather than on an individual basis.

Equitable Tolling Granted

The court also granted the plaintiffs' request to toll the statute of limitations from the date the certification motion was filed (May 31, 2024) through the date of the order. Under the FLSA, the statute of limitations for potential opt-in plaintiffs continues to run until they file consent forms unlike a traditional class action. Judge Reeves found that the delay in resolving the certification motion was not caused by routine litigation or by any party's conduct, but rather by the court's own schedule. Because that delay was beyond anyone's control, tolling was equitable.

What This Means for Mississippi Mental Health Workers

If you are a current or former Community Provider at MBHS - whether a Mental Health Therapist, Community Support Specialist, or Peer Support Specialist - and you worked more than 40 hours in a week without receiving overtime pay at time-and-a-half, this case may directly affect you. The opt-in period runs for 60 days from the date of the order and expires on May 11, 2026. That means the window to join the case is open now but will not stay open forever.

More broadly, the pay structure at issue in this case is not unique to MBHS. Many behavioral health providers, home health agencies, and community-based care organizations in Mississippi use similar billable-hour models that effectively ignore the nonbillable work their employees perform. If you work in the behavioral health field and your employer only tracks or pays for billable hours but expects you to handle travel, documentation, training, and meetings on your own time, you may have a claim for unpaid overtime under the FLSA.

Key Takeaways

This opinion is a useful addition to the growing body of post-Swales certification decisions in the Fifth Circuit. First, the court applied the Loy v. Rehab Synergies framework, confirming that while the old Lusardi factors are no longer mandatory, they remain useful guideposts. The court found that shared factual and employment settings, collectively arguable defenses, and fairness considerations all supported certification here.

The salary-basis analysis under Hewitt continues to be a potent tool for plaintiffs. Where an employer's pay structure allows reductions based on hours or output, there is a strong argument that the salary-basis test is not met which can defeat the learned professional, administrative, and executive exemptions across an entire class.

The equitable tolling ruling is also noteworthy. Judge Reeves distinguished this case from the general rule that protracted litigation does not justify tolling, finding that the court's own scheduling delays constituted an extraordinary circumstance under Sandoz v. Cingular Wireless. Practitioners filing certification motions should consider requesting tolling as a matter of course, particularly when significant delay is anticipated.

Contact Us

If you believe you have been denied overtime pay, we want to hear from you. At Simpson, PLLC, we represent employees in unpaid overtime and wage claims across Mississippi and nationwide. Contact us today at jack@simpson-pllc.com or (662) 913-7811 for a free consultation.