Wage and Hour Law Update : Wage & Hour Lawyer & Attorney : Jackson Lewis Law Firm : Minimum Wage, Overtime & Service Contracts

Jackson Lewis previously advised clients and friends of the Health Care Reform Act’s provision requiring employers to provide employees breaks for breastfeeding: http://www.jacksonlewis.com/legalupdates/article.cfm?aid=2016. (Regulations interpreting such requirements are expected to be issued within the next 6 months.)  Also contained in the over two thousand-page enactment is Section 1558, which adds a new Section 18C to the FLSA.  This new FLSA provision prohibits employers from discriminating or retaliating against any employee who has:

(1) received a credit under section 36B of the Internal Revenue Code of 1986 or a subsidy under section 1402 of this Act; (2) provided, caused to be provided, or is about to provide or cause to be provided to the employer, the Federal Government, or the attorney general of a State information relating to any violation of, or any act or omission the employee reasonably believes to be a violation of, any provision of this title (or an amendment made by this title); (3) testified or is about to testify in a proceeding concerning such violation; (4) assisted or participated, or is about to assist or participate, in such a proceeding; or (5) objected to, or refused to participate in, any activity, policy, practice, or assigned task that the employee (or other such person) reasonably believed to be in violation of any provision of this title (or amendment), or any order, rule, regulation, standard, or ban under this title (or amendment).

Aggrieved current or former employees who assert claims under this provision are entitled to a jury trial.

Employers can expect this cause of action for retaliation to be another tool in the arsenal of Plaintiffs’ lawyers.

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In today’s world, it is not overly difficult for a prospective employer to learn that an applicant has sued a prior employer under the FLSA. Can the prospective employer decide not to hire based on this information? 

In Dellinger v. Sci. Applications Int'l Corp., 2010 U.S. Dist. LEXIS 32861 (E.D. Va. Apr. 2, 2010), Judge Cacheris of the United States District Court for the Eastern District of Virginia, Alexandria Division, held that an employer could do so, finding that the FLSA’s anti-retaliation provision only protects employees, and not applicants. In reaching its decision, the court relied on two district court cases from other jurisdictions with similar holdings – Harper v. San Luis Valley Regional Medical Center, 848 F.Supp. 911 (D. Colo. 1994) and Glover v. City of North Charleston, 942 F. Supp. 243 (D.S.C. 1996). Judge Cacheris continually referred to the express language of the FLSA and declined to expand the definition of “employee” (meaning one who is “suffered or permitted” to work) to include applicants, observing that the plaintiff had never performed any work for the defendant. 

While no appellate court has ruled on this particular issue, Dellinger supports an employer’s right to disqualify applicants based on previous filings of FLSA suits. 

Of course while such information regarding prospective employees can be easily acquired in the era of the online social network, with extensive information about almost any subject only a click or two away through so-called “open source” searches, there are numerous potential pitfalls including potential FCRA violations and violations of “lawful activities” statutes (such as N.Y. Labor Law § 201-d) in gathering such information.

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The Supreme Court, on March 22, 2010, agreed to answer a question that has divided the circuit courts of appeal—whether the FLSA retaliation provision protects verbal complaints made by employees or only written ones. The Court will review the Seventh Circuit’s decision in Kasten v. Saint-Gobain Performance Plastics Corp., 570 F.3d 834 (7th Cir. 2009), where the Seventh Circuit held verbal complaints regarding unlawful pay practices do not fall under the protections of the FLSA’s anti-retaliation provision, 29 U.S.C. § 215(a)(3).  The decision follows the Second and Fourth Circuits, which previously held that an employee is not protected from retaliation under the FLSA where the employee has not complained in writing, based on the statutory requirement that the retaliation be in response to a “filing” (Note: the Second Circuit goes even further -- declining to protect internal written complaints and protecting only formal complaints to the DOL or a court). In Kasten, the Seventh Circuit agreed with this interpretation, and held that since Plaintiff’s complaints were “purely verbal”, this was fatal to his claim.  Id. at 838. 

Several circuit courts, including the First, Fifth, Sixth and Ninth, however, have ruled verbal complaints are sufficient. Three judges dissented in the Seventh Circuit’s subsequent decision in Kasten to deny rehearing en banc, citing these cases. Kasten v. Saint-Gobain Performance Plastics Corp., 585 F.3d 310 (7th Cir. 2009). The dissenters criticized the majority's decision, observing: "the [Seventh Circuit] has taken a position contrary to the longstanding view of the Department of Labor, departed from the holdings of other circuits, and interpreted the statutory language in a way that [we] believe is contrary to the understanding of Congress." Id. at 311.

The Supreme Court’s decision in Kasten, whether accepting or rejecting the Seventh Circuit’s employer-friendly approach, will hopefully provide some clarification regarding whether internal verbal complaints are protected under federal law. As always, state laws may (and do) differ.

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