RETALIATION UNDER THE FAIR LABOR STANDARDS ACT: DON`T DO IT
BY RANDY K. CLARK
It is common knowledge that within the Fair Labor Standards Act (FLSA)1 you will find regulations and prohibitions pertaining to topics such as minimum wages and maximum hours, FLSA exemptions, and so on. What may not be as well known is that within the FLSA are specific provisions that prohibit an employer from retaliating or discriminating against any employee who files a claim or exercises a right under the FLSA.2 In addition, the FLSA has a specific section that provides for potential damages that can be assessed against an employer.3 These damages include civil4 and criminal5 penalties.
Following is an overview of the sections on retaliation and remedies and a survey of recent case law construing these sections under various scenarios.
RETALIATION
The pertinent section of the FLSA for private employees is section 15 (a) (3), which provides
?, Prohibited acts; Prima facie evidence
(a) After the expiration of one hundred and twenty days from the date of enactment of this Act (June 25, 1938), it shall be unlawful for any person
(3) to discharge or in any other manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to the Act (29 USCS §§ 20 1-2 16, 217-219, 557), or has testified or is about to testify in any such proceeding, or has served or is about to serve on an industry committee.
The pertinent section of the FLSA for public employees is section 8 of the Fair Labor Standards Amendments of 1985,6 which provides as follows:
A public agency which is a State, political subdivision of a State, or an interstate governmental agency and which discriminates or has discriminated against an employee with respect to the employee`s wages or other terms or conditions of employment because on or after February 19, 1985, the employee asserted coverage under section 7 of the Fair Labor Standards of Act of 19387 shall be held to have violated section 15 (a) (3) of such Act.8 The protection against discrimination afforded by the preceding sentence shall be available after August 1, 1986, only for an employee who takes an action described in section 15 (a) (3).
The prohibition of 29 USCS § 215 (a) (3) against discharge or discrimination in any other manner was promulgated to permit employees to feel free to exercise their rights in the form of asserting coverage under the Act. Further rationale is found in the desire to establish a higher degree of likelihood of compliance with the substantive provisions of the FLSA. The employer must be aware that liability for retaliation under the Act will be premised on the employee`s engaging in conduct based on a belief that the employer has violated the FLSA. This means that even if it is found that the employer has not violated the FLSA, no retaliatory action may be taken against the employee who took action mistakenly believing that the employer had violated the FLSA.9 Thus, it is clear that an employer may be liable under the retaliation section of the Act even though there was an underlying FLSA violation.10 The employee must be free to find out whether the FLSA is being violated without the threat of retaliation from his employer.
It does not take a formal lawsuit or the filing of a complaint to establish that an employee has asserted coverage under the FLSA. Just making an inquiry or complaining to Department of Labor investigators or other personnel is sufficient for the purposes of retaliation under the FLSA. In Brock v. Richardson,11 the court held that an employer who discharged his employee after the employee met with a Department of Labor compliance officer violated 29 USCS section 215 (a) (3), even though the employee had not actually filed a complaint under the FLSA as the employer believed he had. The court said that “the discharge of an employee in the mistaken belief that the employee has engaged in protected activity creates the same atmosphere of intimidation as the discharge of an employee who did in fact complain of FLSA violations.” Similarly, in Daniel v. Winn-Dixie Atlanta, Inc.,12 the court held that an employee`s telephone call to the wage and hour division of the Department of Labor triggered the protection of section of 215 (a) (3), even though the employee did not file a complaint or testify in a proceeding.13
In addition, the employer must be careful when it comes to discharging an employee who has previously asserted coverage under the Act. Courts have held that even where an employer had good cause to discharge an employee for other reasons, the employer was held liable under section 215 (a) (3) if the immediate cause or motivating factor of the discharge is the employee`s assertion of rights under the FLSA.14
Conversely, the fact that an employee has complained about FLSA violations or otherwise asserted coverage under the Act does not establish an employer`s liability under section 215 (a) (3) for a subsequent discharge or discipline of the employee if the employer`s action was for good cause and not motivated by the employee`s protected activity. In Martin v. Gingerbread House, Inc.,15 the court held that the discharge of a day care center employee was not in retaliation for filing a complaint with the Secretary of Labor under the FLSA, where the employer had a host of legitimate reasons for termination including failure to follow directions, mismanagement, and inappropriate use of students to care for a small child.
An employer will not be held liable for retaliating against an employee for engaging in protected activity where it is shown that the employer was not aware of the activity.16 Nor will an employer be held liable where the discharge of an employee was necessitated by financial reasons unrelated to the employee`s complaints under the FLSA.17
The scope of coverage of the prohibition against discriminations is very broad. Under section 215 (a), “any person” may be liable for violations of section 215 (a) (3). Courts have said that this provision and section 203, which defines “employer” under the FLSA, should be construed broadly. The result has been to find managerial employees and owners personally liable for retaliatory action taken against employees.18 In determining personal liability of a managerial employee or an owner, the courts have considered such factors as personal involvement in the acts of retaliation, daily management or supervisory activities, and financial interest in the company.19 Further, in construing the term “any person” under section 215 (a) broadly, it has been held that “any person” under the Act is broad enough to include a labor union, its officers, and members.20
“DISCHARGE OR IN ANY OTHER MANNER DISCRIMINATE”
A. “Discharge”
This key language tells the employer what conduct he cannot engage in in response to an employee`s asserting coverage under the FLSA. As with other provisions of the FLSA, this language has been interpreted broadly. The plain meaning provides that an employer cannot fire an employee for asserting coverage or filing a claim under the FLSA. This broad scope of protection is evident in Nairne v. Manzo,21 where the court held that an employee was protected from discrimination under section 215 (a) (3) for posting wage and hour information in her employer`s office. There, the employee, after learning that employees covered by the FLSA were entitled to time and a half for overtime, posted a “wage and hour” bulletin she received from the Department of Labor and was subsequently discharged by her employer. The court held this to be a retaliatory discharge.
The court in Malone v. Signal Processing Technologies, Inc.22 set out the requisite elements of an alleged retaliatory discharge saying that the claimant must prove that (1) the employee engaged in protected opposition to discrimination or participated in a proceeding arising out of discrimination; (2) the employer took adverse action against the employee after she engaged in protected conduct; and (3) that there is a causal connection between the employee`s protected activity and the employer`s reaction. Once the plaintiff in a retaliatory discharge claim shows that she engaged in a protected activity, she suffered an adverse action by her employer, and that there is a causal link between the protected conduct and the adverse action, the burden shifts to the employer defendant to articulate and legitimate nondiscriminatory reasons for the discharge.23 Once the employer meets this burden of production, the plaintiff must then show that the stated reasons are pretext for discrimination.
This “non-discharge” prohibition has also been expanded to prohibit the employer from “constructively discharging” an employee who has asserted coverage under the FLSA. The employer who cannot discharge an employee in retaliation for asserting coverage under the FLSA is also prohibited from creating intolerable and discriminatory working conditions that would force an employee to “voluntarily quit,” thereby obtaining the same result that the employee asserting the coverage has been discharged.
In Ford v. Alfaro,24 the court held that two employees were constructively discharged in violation of 29 USCS section 215 (a) (3) for exercising their rights under the FLSA. The court said that the conduct of the employer in threatening an employee with serious bodily harm after the employee told the employer that he intended to testify at a trial concerning the employer`s violation of the FLSA, along with harassment on the job and other actions which impeded the employee`s ability to perform his job, constituted “constructive discharge” in violation of the FLSA.
However, the courts will place the burden of proving that a reasonable person could not have continued working in the environment created by the employer to establish a constructive discharge under the FLSA on the plaintiff. In Cuevas v. Monroe Street City Club, Inc.,25 the court held that a restaurant worker failed to establish a prima facie case of retaliatory constructive discharge under the FLSA on the basis of claims that his supervisor ignored his complaints, the breakfast shifts were reduced, and his supervisor was hard on him. This conduct on the part of the employer could not have created an atmosphere in which a reasonable employee would feel forced to quit his job, which is required for constructive discharge under the FLSA.
B. “In Any Other Manner Discriminate”
This language has also been given a broad interpretation by the courts. In Hill v. Greenville,26 the court held that city firefighters were improperly discriminated against under the FLSA where the city had unilaterally reduced the firefighters` hourly rate of pay to nullify the effect of overtime payments required under the FLSA. After the decision in Garcia v. San Antonio Metropolitan Transit Authority,27 which made minimum wage and overtime provisions applicable to state and municipal employees, the defendant city recalculated the firefighters` compensation on an hourly basis and then reduced their hourly rate of pay. The court held that the city was prohibited by section 8 of the FLSA from reducing the firefighters` wages if the reduction was in response to application for the FLSA overtime provision.28
However, in Adams v. City of McMinn-ville,29 the court held that it was not discrimination against firefighter employees, where the city responded to fiscal pressure created by the FLSA by reducing the number of hours worked by firefighters so they would not work overtime, thereby eliminating the city`s need to pay premium wages for overtime.
Under some circumstances, an employer can be held liable for retaliation for failing to promote an employee. In EEOC v. Romeo Community Schools,30 the court held that an employee who was denied a promotion to permanent status after having told her employer that she believed it was “breaking some sort of law” established a prima facie case of retaliation and said that is asserting of statutory rights, which is the triggering factor in retaliation claims, not the filing of a formal complaint.
Additionally, this provision also prohibits an employer from demoting an employee in retaliation for asserting a right under the FLSA. This was the case in Soto v. Adams Elevator Equipment Company,31 where the court held that it was a violation of the FLSA to retaliate against the employee who had initiated a lawsuit under the Act by demoting her, and she was entitled to damages as a result.
Given the broad scope and liberal construction of these provisions, it seems that almost any kind of adverse action taken against an employee in retaliation for asserting coverage of FLSA can result in the employer`s being liable under the FLSA. While much of this conduct falls short of the seriousness of discharging an employee, it nonetheless can have serious consequences to an employer who is held liable for “in any other manner discriminating” against an employee who asserted coverage or exercises a right under the FLSA.
REMEDIES
The pertinent section of the FLSA with respect to remedies for violations of section 215 is section 16, which provides as follows:
?. Penalties
(a) Any person who willfully violates any of the provisions of section 215 of this title shall be upon conviction thereof be subject to a fine of not more than $10,000, or to imprisonment for not more than six months, or both. No person shall be imprisoned under this subsection except for an offense committed after the conviction of such person for a prior offense under this section.
(b) Any employer who violates the provisions of section 206 or section 207 of this title shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime liquidated damages. Any employer who violates the provisions of section 215 (a) (3) of this title shall be liable for such legal or equitable relief as may be appropriate to effectuate the purposes of section 215 (a) (3) of this title, including without limitation, employment, reinstatement, promotion, and the payment of wages lost and an additional equal amount as liquidated damages. An action to recover the liability prescribed in either of the preceding sentences may be maintained against any employer (including public agency) in any Federal or State court of competent jurisdiction by any one or more employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought. The court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney`s fee to be paid by the defendant, and cost of the action. The right provided by this subsection to bring an action by or on behalf of any employee, and the right of any employee to become a party plaintiff to any such action, shall terminate upon the filing of a complaint by the Secretary of Labor in an action under section 217 of this title in which (1) restraint is sought of any further delay in the payment of unpaid minimum wages, or the amount of unpaid overtime compensation, as the case may be, owing to such employee under section 206, or section 207 of this title by an employer liable therefore under the provisions of the subsection or (2) legal or equitable relief is sought as a result of alleged violations of section 215 (a) (3).
In essence, subsection (a) provides criminal penalties for an employer who violates the provisions of section 215 with respect to retaliation against employees for asserting coverage under the FLSA. Subsection (b) provides for civil remedies where the employee may recover monetary damages for lost wages, liquidated damages, interest, attorney`s fees, and court costs. This section allows a private action by an employee in Federal or State court or the employee can elect to have the Secretary of Labor represent him.
The Court in Hayes v. McIntosh32 stated that the underlying rationale respecting the goals of the remedies provision where they said that in order to carry out the purposes of the section of the FLSA prohibiting discharge or discrimination against an employee who has filed a complaint or instituted a proceeding under the Act by freeing employees of the fear of economic retaliation, a discharged employee should be restored, as nearly as possible to the same situation he would have occupied if he had not been discharged.
An example of just how broad the scope of available remedies is can be found in Travis v. Gary Community Mental Health Center, Inc,33 where the court awarded the plaintiff $45,500 in punitive damages and $35,000 in compensatory damages, plus $21,000 in attorney`s fees based upon retaliation in violation of section 215 (a) (3). The court noted that the language permitting certain specified remedies “without limitation” meant that Congress has authorized other measures of relief as well. The court therefore concluded that section 216 (b) was sufficiently broad to support an award of compensatory and punitive damages for retaliation stating that “compensation for emotional distress, and punitive damages, are appropriate for intentional torts such as retaliatory discharge.”
In Soto v. Adams Elevator Equipment Company,34 the court allowed a recovery of $43,000 in damages to the plaintiff based on finding retaliation by the employer under the FLSA and affirmed an award of $42,381 in attorney`s fees under section 216 (b).
* * *
The FLSA provides guidelines on what conduct is prohibited with respect to employers taking action against employees in response to their having filed a formal or informal claim under the FLSA or otherwise asserting coverage under the Act. The penalty provisions are designed to encourage compliance with the FLSA as well as to provide remedies for employees who have been damaged by an employer`s illegal conduct. In most instances, it is in neither the employer nor the employee`s best interest to have retaliatory action taken that violates the FLSA. Employers should be aware that the Act expressly provides the courts with wide latitude in fashioning remedies in the form of damages in favor of employees who have been discriminated against.
The fire chief should first realize the consequences and the applicability of the FLSA to the fire departments, take steps to ensure compliance, and finally refrain from taking retaliatory action against any employee who files a claim or asserts coverage under the FLSA. The easy way out is to make excuses or blame the complexity of the laws after a problem arises. The professional will address FLSA issues before they become problems and should not hesitate to seek legal assistance from the city or county attorney or other similar legal resource. n
Endnotes
1. Fair Labor Standards Act of 1938, as amended (52 Stat. 1060, as amended; 29 USC 201-219).
2. Section 15 (a) (3) of the Fair Labor Standards Act [29 USC § 215 (a) (3)].
3. Section 16 (a) and (b) of the FLSA [29 USC § 216 (a) and (b)].
4. 29 USC § 216 (b).
5. 29 USC § 216 (a).
6. Reprinted as a note at 29 USCS § 215.
7. 29 USCS § 207.
8. 29 USCS § 215 (a) (3).
9. Brock v. Richardson, 812 F.2d 12 1 (3rd Cir. 1987).
10. In Legutko v. Local 816, International Brotherhood of Teamsters, 606 F. Supp. 352 (E.D. N.Y. 1985), aff`d on other grounds 852 F.2d 1046 (2d Cir. 1985), the court held that irrespective of the merits of an employee`s substantive overtime claim under 29 USCS § 207 (a) (1), the employee stated a cause of action under § 215 (a) (3) by alleging that his employer threatened to discharge him for circulating a petition requesting union intervention to stop what he perceived to be an overtime violation under the FLSA.
11. 812 F.2d 121 (3rd Cir. 1987).
12. 611 F. Supp. 57 (N.D. Ga. 1985).
13. See also, Prewitt v. Factory Motor Parts, Inc., 747 Supp. 560 (W.D.Mo.1990), where the court held that an employee`s telephone call to the Wage and Hour Division of the Department of Labor, inquiring into the legality of the employer`s proposed plan to change salaries and working hours, was conduct protected by the FLSA section prohibiting retaliatory discharge.
14. In Love v. RE/MAX of America, Inc., 738 F.2d 383 (10th Cir. 1984), the court said that when the immediate cause or motivating factor of a discharge is the employee`s assertion of statutory rights, the discharge is discriminatory under 29 USCS § 215 (a) (3) regardless of whether other grounds for discharge exist.
15. 977 F.2d. 1405 (10th Cir. 1992).
16. Strickland v. MICA Information Systems, 800 F. Supp. 1320 (M.D. N.C. 1992).
17. Brennan v. Braswell Motor Freight Lines, Inc., 396 F. Supp. 704 (N.D. Tex. 1975).
18. In Hayes v. McIntosh, 604 F. Supp. 10 (N.D. Ind. 1984), the court, in an action for retaliatory discharge under 29 USCS § 215 (a) (3), held the employer corporation as well as the man who had been the primary owner and operator of the corporation liable under the Act.
19. Donovan v. Schoolhouse Four, Inc., 573 F. Supp. 185 (W.D. Va. 1983).
20. Bowe v. Judson C. Burns, Inc., 137 F.2d 37 (3rd Cir. 1943).
21. 187 US Dist LEXIS 2723 (E.D. Pa. 1987).
22. 826 F. Supp. 370 (D. Colo. 1993).
23. See generally, Cuevas v. Monroe Street City Club, Inc., 752 F. Supp. 1405 (N.D. Ill. 1990).
24. 785 F.2d 835 (9th Cir. 1986).
25. 752 F. Supp 1405 (N.D. Ill. 1990).
26. 696 F. Supp. 1123 (N.D. Tex. 1988).
27. 469 U. S. 528 (1985).
28. Hill v. Greenville at 1129.
29. 890 F.2d 836 (6th Cir. 1989).
30. 976 F.2d 985 (6th Cir. 1992).
31. 941 F. 2d 543 (7th Cir. 1991).
32. 604 F. Supp. 10 (D.C. Ind. 1984).
33. 921 F.2d 108 (7th Cir. 1990).
34. 941F.2d 543 (7th Cir. 1991).
RANDY K. CLARK is a trial lawyer and former fire officer who practices civil law including civil rights and employment issues. He writes and consults on fire service legal issues and is currently working on The Fire Chief`s Guide to Avoiding Litigation.
