Key Indicia Of Retaliation In FLSA Action

by Proskauer - Whistleblowing & Retaliation
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The U.S. Court of Appeals for the Seventh Circuit recently denied an employer’s  motion for summary judgment in a closely watched FLSA retaliation case based on circumstantial evidence of a causal nexus between protected activity and an adverse employment action. Kasten v. Saint-Gobain Performance Plastics Corp., No. 12-cv-1671, 2012 U.S. App. LEXIS 24624 (7th Cir. Nov. 30, 2012). The court focused closely on:  (i) suspicious timing; (ii) allegedly “ambiguous” statements and behavior; and (iii) purported evidence of pretextual reasons for the adverse employment action. Though this case arises in the FLSA context, it sheds light on the approach the Seventh Circuit other courts can be expected to take in a variety of employment retaliation cases.

Background Facts & Procedural History

Defendant-Appellee Saint-Gobain Performance Plastics Corporation (the “Company”) employed Plaintiff-Appellant Kevin Kasten as an hourly manufacturing and production employee. The Company discharged Mr. Kasten after he lodged oral complaints concerning the location of time clocks at a production facility. Mr. Kasten received several warnings about his failures to punch-in and punch-out, and two suspensions. The Company discharged Mr. Kasten shortly after he complained, and he proceeded to file suit in the U.S. District Court for the Northern District of Illinois, alleging a violation of the FLSA anti-retaliation provision (29 U.S.C. § 215(a)(3)).

The district court originally granted the Company summary judgment, concluding that oral complaints do not constitute protected activity under the FLSA, and the Seventh Circuit affirmed. But the U.S. Supreme Court vacated and remanded, ruling that oral complaints can qualify as protected activity if they provide fair notice that an employee is asserting his or her rights under the FLSA. On remand, the district court found Mr. Kasten’s oral complaints provided such fair notice, but that summary judgment in the Company’s favor still was warranted on causation grounds.

The Seventh Circuit’s Ruling

The Seventh Circuit reversed, finding that Mr. Kasten raised a jury question with respect to fact issues bearing on causation, stressing that circumstantial evidence in this context (specifically, under the direct method of proof) can include suspicious timing, ambiguous statements or behaviors, evidence that similarly situated employees were treated differently, and a pretextual reason for an adverse action. The Seventh Circuit found that much of this indicia existed in this case in light of the following assertions Mr. Kasten made. Specifically:

  1. Suspicious Timing: The decision to discharge Mr. Kasten allegedly was made hours after operations and plant managers learned that he asked his shift supervisor about class action lawsuits regarding time-clock punches.
  2. Ambiguous Statements: Mr. Kasten asserted that his supervisor told him to “Just lay down and tell them what they want to hear, [they] can probably save your job.”
  3. Suspicious Behavior: The Company allegedly moved the time-clocks the day Mr. Kasten was discharged.
  4. Pretext: The court relied on Mr. Kasten’s assertion that the Company’s reasons for his discharge had shifted.

Implications

The Kasten case has received substantial attention because it led to a Supreme Court ruling on what qualifies as protected activity under the FLSA; oral complaints now qualify as protected activity under the FLSA’s anti-retaliation provision. The Seventh Circuit’s most recent decision in this case with respect to issues of causation is instructive as well. Indeed, employment retaliation cases are routinely filed under myriad statutes governing the employment relationship and the principles articulated in this case shed light on the framework the Seventh Circuit and other courts generally apply. However, it is important to note that a range of anti-retaliation statutes – such as AIR 21, the Energy Reorganization Act, the STAA, and Section 806 of SOX – have unique burden-shifting standards that differ in material respects from the framework applied in Kasten.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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