File this one away: Supreme Court continues its trend of protecting complaining employees from retaliation

Kasten v. Saint-Gobain Performance Plastics asks a very simple question: does the word “file” in the Fair Labor Standards Act’s anti-retaliation provision only refer to written complaints, or does it also cover oral complaints? Yesterday, by a 6-2 majority, the Supreme Court concluded the latter, resolving a split among the federal appellate courts and, yet again, opening employers to more expansive liability for retaliation.

The Court spent nearly half of its analysis discussing the merits of various definitions of the word “file,” only to conclude that “the text, taken alone, cannot provide a conclusive answer to our interpretive question. The phrase ‘filed any complaint’ might, or might not, encompass oral complaints.” It instead reached its conclusion that the FLSA’s “antiretaliation provision cover[s] oral, as well as written, ‘complaint[s]’” based on policy concerns:

Why would Congress want to limit the enforcement scheme’s effectiveness by inhibiting use of the Act’s com­ plaint procedure by those who would find it difficult to reduce their complaints to writing, particularly illiterate, less educated, or overworked workers? …

To limit the scope of the antiretaliation provision to the filing of written complaints would also take needed flexi­bility from those charged with the Act’s enforcement. It could prevent Government agencies from using hotlines, interviews, and other oral methods of receiving com­ plaints. And insofar as the antiretaliation provision cov­ers complaints made to employers…, it would discourage the use of desirable informal workplace grievance procedures to secure compliance with the Act….

The Court concluded that the method of communication of a complaint is irrelevant to whether it qualifies as protected activity. A complaint is protected, whether oral or written, if it is “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 case merely brings the FLSA’s anti-retaliation provision in line with most, if not all, other statutes. Employers simply need to be aware that they take must all complaints seriously, whether communicated verbally or in writing.

The takeaway that is significant for employers, however, is just how difficult oral complaints are to handle. Oral complaints often place employers in the difficult position of having to prove a negative—that is, that the employee did not complain. To combat this problem, employers should consider establishing a protocol that all complaints must be documented, whether by the employee making the complaint or the individual receiving it. Provided that this protocol is consistently and uniformly followed, an employer will at least have the benefit of an inference that an oral complaint was not made if no written record exists.

As always, I’m happy to share the thoughts of my fellow blawgers:

• BREAKING: SCOTUS Holds that Oral Complaints Receive Retaliation Protection Under FLSA – from Philip Miles’s Lawffice Space
• Oral Complaints under FLSA are Shielded from Retaliation, Supreme Court Rules; Impact in Connecticut? – from Daniel Schwartz’s Connecticut Employment Law Blog
• When Your Employees Verbally Complain, You Better Listen! – from Stephanie Thomas’s The Proactive Employer Blog
• File this Supreme Court decision under “R” for RETALIATION – from Eric Meyer’s The Employer Handbook Blog
• Employees are protected from retaliation for making verbal complaint under the Wage and Hour Laws – from Business, Employment and Real Estate Law in Ohio
• Kasten v. Saint-Gobain Performance Plastics Corp., U.S., No. 09-834, 3/22/11 – from LaborRelated (which includes a great cartoon illustrating the case)
• Kasten v. Saint-Gobain - Supreme Court Rules in Favor of Employees in FLSA Complaint Case – from HR Lawyer’s Blog
• SCOTUS: Oral complaints can qualify as “filed” for FLSA purposes – from Work Matters
• Employers Cannot Fire Workers Who File Oral or Written FLSA Complaints, U.S. Supreme Court Holds – from Joe’s HR and Benefits Blog
• Supreme Court Rules that Oral Complaint Can Support FLSA Retaliation Claim – from Workplace Prof Blog
• Supreme Court Rules Oral Complaints Of Wage Violations Are Protected Under FLSA – from World of Work
• USSCt: Oral Complaints Are Covered Under the Fair Labor Standard Act’s Anti-Retaliation Provision – from Alaska Employment Law
• Oral Complaint Protected From Retaliation Under FLSA – from Hawaii Labor and Employment Law
• Supreme Court Defines When an Employee Complaint is a “Complaint” – from TLNT
• Supreme Court Decides FLSA Retaliation Case based upon Oral Notice – from Alabama Employment Law Report

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BREAKING NEWS: FLSA anti-retaliation provision covers oral complaints, per SCOTUS

This morning, the Supreme Court held that the FLSA’s anti-retaliation provision includes oral, in addition to written, complaints.

• A copy of the opinion in Kasten v. Saint Gobain Performance Plastics is avaiable for download here.
• You can read my prior thoughts on this case here.

I’ll have analysis of this opinion tomorrow, including what it means for employers.

[Hat tip: Lawffice Space]

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

The “cat’s paw” lives: Supreme Court issues broad victory for employees in Staub v. Proctor Hospital

This morning, the Supreme Court issued its decision in Staub v. Proctor Hospital, which asked whether the “cat’s paw” is a valid theory of liability in discrimination cases. The “cat’s paw” seeks to hold an employer liable for the discriminatory animus of an employee who played no role in the decision, but nevertheless exerted some degree of influence over the ultimate decision maker.

Staub is a huge victory for employees. A unanimous opinion written by Justice Scalia whole-heartedly endorsed the “cat’s paw”:

We therefore hold that if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA.

The Court also declined to immunize employers who undertake their own independent investigation of the circumstances leading to the adverse employment action. Instead, the Court only excuses reliance on the biased report of a supervisor if the employer independently determines that the decision was entirely justified apart from the supervisor’s input:

Thus, if the employer’s investigation results in an adverse action for reasons unrelated to the supervisor’s original biased action (by the terms of USERRA it is the employer’s burden to establish that), then the employer will not be liable. But the supervisor’s biased report may remain a causal factor if the independent investigation takes it into account without determining that the adverse action was, apart from the supervisor’s recommendation, entirely justified.

While the Court limited its holding to USERRA, it pointed out that USERRA’s “motivating factor” causation standard is “very similar to Title VII.” It will be difficult for lower court’s to avoid this broad application of the cat’s paw in Title VII (and likely ADA) cases. The only hold-out will be ADEA cases, which, in light of Gross v. FBL Financial Services, Inc., requires “but for” causation.

I have two initial reactions to this opinion:

1. Staub is a broad, sweeping win for employees, which leaves employers with little protection against the discriminatory animus of those who play no role in the decision making process.
2. The Court’s holding hinges on ideals such as “intent” and “proximate cause,” which are almost always fact-based inquiries. Because it is very difficult for an employer to win summary judgment on these issues, the Court has turned nearly every “cat’s paw” case into a jury case—an expensive proposition for employers.

Staub v. Proctor Hospital [pdf] is available for download directly from the Supreme Court’s website via this link.

[Hat tip: Workplace Prof Blog]

It’s déjà vu all over again—Supreme Court recognizes associational retaliation

In The Gay Science, Friedrich Nietzsche explained his theory of the eternal recurrence—that if the universe is infinitely big, time is eternally long, and everything that exists in that universe is made up of a finite number of elements, then over the course of eternity everything that happens will happen again. For the theory of associational retaliation under Title VII, eternity didn’t even last four years.

In Thompson v. North American Stainless, the 6th Circuit originally recognized the theory of associational retaliation – that Title VII prohibits an employer from retaliating by inflicting reprisals on a third party (such as a spouse, family member, or fiancé) closely associated with the employee who engaged in such protected activity but who engaged in no protected activity of his or her own.

Sometimes, it stinks to be right. In its unanimous opinion [pdf], the Court recognized that certain employees, within the “zone of interests” protected by Title VII, will have a valid claim for associational retaliation:

Title VII’s antiretaliation pro­vision prohibits any employer action that “well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” … We think it obvious that a reasonable worker might be dissuaded from engaging in protected activity if she knew that her fiancé would be fired…. We … decline to identify a fixed class of relation­ ships for which third-party reprisals are unlawful. We expect that firing a close family member will almost al­ways meet the Burlington standard, and inflicting a milder reprisal on a mere acquaintance will almost never do so, but beyond that we are reluctant to generalize…. 

[W]e conclude that Thompson falls within the zone of interests protected by Title VII. Thompson was an employee of NAS, and the purpose of Title VII is to protect employees from their employers’ unlawful actions. Moreover, accepting the facts as alleged, Thompson is not an accidental victim of the retaliation—collateral damage, so to speak, of the employer’s unlawful act. To the contrary, injuring him was the employer’s intended means of harming Regalado. Hurting him was the unlawful act by which the employer punished her. In those circumstances, we think Thompson well within the zone of interests sought to be protected by Title VII.

What does all this mean?

1. This supposed pro-business Court continues to be decidedly anti-business when it comes to protecting employees from retaliation, and even the most conservative members of this Court are open to expanding civil rights when it satisfies a policy they consider important.
2. Employers are now subject to retaliation for taking an adverse action against anyone “closely related” to an employee who engaged in protect activity.
3. To claim associational retaliation, the aggrieved employee must prove that the employer intended to injure the associated employee by its action against the aggrieved employee.

For employers, there are no bright-line rules for associational retaliation. The real import of this decision is the same as when the 6th Circuit first recognized this new theory of liability nearly four years ago. As I said at that time:

If Title VII protects those "who are so closely related to or associated" with employees who engage in protected activity, it simply begs the question, how close is close enough? In Thompson, the relationship was a fiancée. It is safe to assume liability will also extend to action taken against spouses. What about boyfriends and girlfriends? How long do you have to date to be protected from retaliation? The same protection also will probably extend to parents and children. What about siblings? Grandparents? Cousins? 3rd cousins twice removed? In-laws? Friends? Carpoolers? The people you share your lunch table with? The person you sat next to in 3rd grade? How close is close enough for an employer to intend for its actions to punish the exercise of protected activity? Do employers now have to ask for family trees and class pictures as part of the orientation process? 

These questions, none of which the Thompson court answers, could hamstring employers from making any employment decisions for fear of doing something against someone who has some relationship to someone else who complained about something last October. The implications of this case have the potential to reach that level of silliness. The best course of action is still to make legitimate personnel decisions for bona fide business reasons and let the chips fall where they may.

Does Justice Alito read my blog? Dissecting the oral argument in Thompson v. North Am. Stainless

Thompson v. North Am. Stainless is near and dear to my heart. This post marks the 8th I’ve written covering this important 6th Circuit retaliation case. Yesterday, the Supreme Court heard oral argument on the issue of whether Title VII prohibits an employer from retaliating by inflicting reprisals on a third party (such as a spouse, family member, or fiancé) closely associated with the employee who engaged in such protected activity but who engaged in no protected activity of his or her own. The oral argument transcript is available for download [pdf] from the Supreme Court’s website.

When the 6th Circuit originally recognized a cause of action for associational retaliation (before the en banc reversal that led to the Supreme Court appeal), I worried, “How close is close enough?”

In Thompson, the relationship was a fiancée. It is safe to assume liability will also extend to action taken against spouses. What about boyfriends and girlfriends? How long do you have to date to be protected from retaliation? The same protection also will probably extend to parents and children. What about siblings? Grandparents? Cousins? 3rd cousins twice removed? In-laws? Friends? Carpoolers? The people you share your lunch table with? The person you sat next to in 3rd grade? How close is close enough for an employer to intend for its actions to punish the exercise of protected activity? Do employers now have to ask for family trees and class pictures as part of the orientation process?

While I’m not so vain as to think that Justice Alito reads my blog (just in case, hello, Your Honor), the theme of the slippery slope resonated heavily in his questioning of Mr. Thompson’s attorney:

That’s what's troubling to me about – about the theory. Where it’s a fiancée, it’s – that’s a relatively strong case, but I can imagine a whole spectrum of cases in which there is a lesser relationship between those two persons, and if – if –­ if – unless there’s a clear line there someplace, this theory is rather troubling. …

Can you help – can you help provide where the clear line is? Does it go – does it include simply a good friend? Does it include somebody who just has lunch in the cafeteria every day with the person who engaged in the protected conduct? Somebody who once dated the person who engaged in the protected conduct? Are these all questions that have to go to a jury?

Justice Alito continued to hammer this theme when questioning the attorney arguing for the Justice Department:

Put yourself in the – in the shoes of an employer, and you – you think – you want to take an adverse employment action against employee A. You think you have good grounds for doing that, but you want – before you do it, you want to know whether you’re potentially opening yourself up to a retaliation claim.

Now, what is the employer supposed to do then? They say, … now we need to see whether this person who we’re thinking of taking the adverse employment action against has a … “close relationship” with any of those people. So what do you do? Do you call everybody in from the company and you say, now, is – you know, was – are these people dating? Did they once date? Are they good friends? What are you supposed to do?

Despite this Court’s perception as pro-business, it has proven itself to be a favorable venue for retaliation claims. This Court's pro-employee, anti-retaliation bent should hold form in this case. Notwithstanding Justice Alito’s (and my) concerns, reading the tea leaves I predict Thompson will be a victory for the employee. I cannot see this Court permitting an employer to fire an employee whose fiancée claims discrimination. There should be at least five Justices who will craft a standard workable enough to avoid Justice Alito’s slippery slope.

I don’t expect any bright lines to be drawn. Since Burlington Northern, it is clear that actionable retaliation includes any adverse action that is “harmful to the point that they could well dissuade a reasonable worker from making or supporting a charge of discrimination.” I expect the Court to conclude that this test encompasses associational retaliation; we will be litigating the degree of closeness and its impact on the “reasonable employee” in future retaliation cases.

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BREAKING NEWS: Supreme Court agrees to hear appeal in Dukes v. Wal-Mart

This morning, the Supreme Court agreed to hear the appeal of the class certification of the largest employment discrimination lawsuit ever filed in this country, Dukes v. Wal-Mart. Greg Stohr at Bloomberg News provides details. You can also read my previous thoughts on this historic appeal.

This appeal will not only impact the more than 1.5 million potential class members who seek billions of dollars in damages, but it also has the potential to shape the future of employment class action litigation for years to come. Keep watching this blog for future updates on the landmark Dukes case as it continues to wind its way through the Supreme Court.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Reading the tea leaves: Staub v. Proctor Hospital and the “Cat’s Paw”

Before we get into the specifics of the Staub case, let’s first discuss the relationship between a cat’s appendage and employment discrimination law. The “cat's paw” derives from a 17th century fable by French poet Jean de la Fontaine. In “The Money and the Cat,” a monkey tricks a cat into scooping chestnuts out of a fire so that the monkey can eagerly gobble them up, leaving none left for the cat. It generally describes a situation where one is unwittingly manipulated to do another’s bidding. Drawing the parallel between la Fontaine’s fable and discrimination law, one seeks to hold an employer (the cat) liable for the discriminatory animus of an employee who played no role in the decision, but nevertheless exerted some degree of influence (the monkey). As Mike Maslanka put it on his Work Matters blog, the question is what is an employer’s liability “when the guy who pulled the trigger is pure, but the guy who loads the gun is not?”

Thus, the argument in the case is framed like this:

• Employers argue that federal discrimination laws make the employer liable only for the actions of the employee or supervisor who takes the discriminatory action.
• Employees,  however, argue that the is enough that the person with the discriminatory animus (the money) played some role in the process, even if the decision maker (the cat) is completely unaware of the animus.

As for the specifics of the case, Staub brought his claim under USERRA, which, among other things, protects those in military service from discrimination upon their return to employment from active duty. Staub had been a long-time employee of Proctor Hospital before being called upon to serve in Iraq. Many at the hospital were critical of Staub’s military service because of the strain it put on those who had to cover from him in his absence. When the Vice President of HR, who held no hostility towards Staub, terminated him, he sued, claiming that although the decision maker was not personally biased against his military service, she fired him based on the hostility of Staub’s direct supervisors.

The 7th Circuit reversed a jury verdict for Staub, holding:

[W]here an employee without formal authority to materially alter the terms and conditions of a plaintiff’s employment nonetheless uses her “singular influence” over an employee who does have such power to harm the plaintiff for racial reasons, the actions of the employee without formal authority are imputed to the employer…. [W]here a decision maker is not wholly dependent on a single source of information, but instead conducts its own investigation into the facts relevant to the decision, the employer is not liable for an employee’s submission of misinformation to the decision maker.

In other words, under the 7th Circuit’s pronouncement of the cat’s paw, the employer can only be liable if the decision maker is only influenced by the animus of the non-decision makers.

Yesterday, the Supreme Court held oral argument [transcript, in pdf] in this case. It’s hard to read Supreme Court Justices at oral argument. Sometimes they play devil’s advocate, and sometimes they genuinely challenge the attorney. Regardless, I found the following question from Justice Breyer (one the Court’s more liberal justices) to the employer’s attorney to be insightful:

You have A and B, they are both supervisors; in the one case B fires the employee because he is in the Army, and he says it: Ha, ha, that’s why I’m doing it. In the second case he fires the employee … for a perfectly good reason, but A has lied about it. And the reason A lied about it was because she wanted to tell him a lie so B would fire the employee, and her reason is because he’s in the Army. Those two situations, the second seems to me one of … 80 million situations, fact-related, that could arise, and I don’t know why we want a special standard for such a situation. Why not just ask the overall question, was this action an action that was -­ in which the bad motive was a motivating factor. Forget psychoanalysis of A. B is good enough -- or vice versa.

I also found insightful the following exchange between Justices Alito and Kennedy and the employee’s attorney:

   Justice Alito: Even -- even if the employer at that time did every -- made every reasonable effort to investigate the validity of all the prior evaluations, still the employer would be on the hook?

   A: Yes. There is nothing in the statute or in the common law that creates a special rule for thorough investigation.

   Justice Kennedy: Well, that's a sweeping rule. I was going to ask a related hypothetical. Suppose the -- the officer who is in charge, charged with the decision to terminate or not to terminate says: I'm going to have a hearing. You can both have counsel. And you have who, is it -- suppose Buck -- suppose the two employees that were allegedly anti-military here testified and they said there was no anti-military bias, and the person is then terminated. Later the employee has evidence that those two were lying. Could he bring an action then?

   A: Yes. Yes.

   Justice Kennedy: That’s sweeping. That's almost an insurer’s liability insofar as the director of employment is concerned…. He has to insure. He has -- he has done everything he can, he has an hearing, and he has almost absolute liability.

Reading the tea leaves, it is likely that the cat’s paw will survive the Supreme Court’s review in a narrow form. I predict that the court will derive a standard that looks to the ultimate decision and the role that the animus of the non-decision maker played in that decision. I also think that the Court will craft an affirmative defense or other means to rebut the inference of the cat’s paw, such as the decision maker's independent investigation of the circumstances leading to the termination.

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