March 2011

By: James B. Sherman, Esq.

On March 22, 2011, the Supreme Court expanded the scope of the anti-retaliation provisions of the Fair Labor Standards Act (FLSA), overturning a decision of the Court of Appeals in Chicago. In Kasten v. Saint-Gobain Performance Plastics Corp., Case. No. 09-834, the plaintiff alleged that he was discharged for making an internal, oral complaint to the company’s management about the location of its time clocks, which he claimed prevented workers from being paid for time spent “donning and doffing” protective gear required on the job. The district court and, on appeal, the Seventh Circuit Court of Appeals dismissed Kasten’s claims based on their conclusion that a verbal complaint did not trigger the FLSA’s protection against employer retaliation. In reversing, the Supreme Court held that even though the statute purports to protect those who “filed” a complaint, Congress intended this language to apply to complaints regardless of whether they are in writing or are raised purely through oral objections. Clearly this decision greatly expands the reach of the FLSA’s anti-retaliation provisions and paves for the way for more lawsuits from employees.

As with most other federal and state employment laws, the FLSA contains an anti-retaliation provision to protect employees who avail themselves of the rights it grants (e.g. minimum wages, overtime pay and pay for all compensable time worked). Specifically, in bold where pertinent to this decision, the FLSA’s anti-retaliation provision provides that it is “unlawful for any person … 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 this chapter, or has testified or is about to testify in any such proceeding …” In Kasten, however, the plaintiff employee did not file anything; he merely complained to management – in accordance with the internal grievance-resolution procedure stated in the employee handbook, we might add – that the location of Saint-Gobain’s time clocks prevented employees from punching in to be paid for “the time [they] came in and start doing stuff.” Mr. Kasten went on to verbally complain on other occasions to company officials that what the company was doing was illegal. Since these internal grievances were never stated in writing, however, the lower courts determined that Kasten was not protected from being discharged over them because he never filed a complaint as the statute seemed to require.

In overruling the lower courts, the Supreme Court specifically held:

To fall within the scope of the anti-retaliation provision [of FLSA], a complaint must be sufficiently clear and detailed for a reasonable employer to understand it, in light of both content and context, as an assertion of rights protected by the statute and a call for their protection. This standard can be met, however, by oral complaints, as well as by written ones.

The Court did not decide whether Mr. Kasten’s grievances fell under the FLSA’s protection against retaliation; it merely reversed the Seventh Circuit’s holding that oral complaints cannot trigger such protection. The case was sent back to the lower courts for a determination, based on the facts, whether Kasten can satisfy “the Act’s notice requirement” articulated in the above-quoted objective standard. If his testimony is credible, the odds are in Kasten’s favor since he apparently utilized the company’s own grievance procedure stated in its employee handbook to complain about not being paid for time worked and that the company’s practices were illegal. Another thing in Kasten’s favor is that a court in a separate class/collective action found merit to the allegation that Saint-Gobain violated the FLSA by not paying its workers for time spent donning and doffing certain required protective gear and walking to work areas.

With federal protections now triggered even by internal, verbal employee complaints, what can employers take from this new Supreme Court decision? Here are some thoughts and suggestions from this writer:

• The Court continues to expand the protections afforded to employees under federal workplace laws. Recall the 2006 decision in Burlington Northern v. White, where the Court held that the anti-retaliation provisions of Title VII were not confined to actions related to employment or that occur in the workplace; rather, they encompass any actions that would be “materially adverse” to a reasonable employee, such that they would be dissuaded from engaging in protected activity (e.g. filing an EEOC charge or assisting in an investigation).
• The Kasten Court’s decision now triggers the FLSA’s protections against retaliation much more easily, even including an oral grievance raised in the workplace, so long as it meets the aforementioned “notice” standard.
• Coupled with the Court’s recent “Cat’s Paw” ruling in Staub v. Proctor Hospital, also decided in March of 2011, there is much room for employees to claim to have raised oral complaints with lower level supervisors who then participated in causing some adverse employment action against them in retaliation, even though they may not have been the ultimate decision-makers. Being fact specific, trial courts may need to conduct full trials to sort out the evidence, meaning more and more expensive litigation for employers to defend against such claims.
• As always, but even more so in view of the Supreme Court’s continuing expansion of employee rights, employers are well advised to shore up their internal grievance procedures; train their supervisors on these new developments in the law; and formalize to the greatest extent practical their protocol for disciplinary actions, from the information relied upon to who makes the decisions. In the end, a strong and independent basis to support disciplinary action will always be the best defense against these ever-changing legal avenues available to employees through new legislation and, more recently, the courts.