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Kasten v. Saint-Gobain Performance Plastics Corp., No. 09-834,
Argued October 13, 2011, Decided March 22, 2011

Introduction

Kasten v. Saint-Gobain Plastics Corporation sheds light on the scope of FLSA's anti-retaliation provision. The case involved an employee who alleged that he was discharged as a result of oral complaints to his employer about the placement of its timeclocks. Overturning the Seventh Circuit's judgment that oral complaints are not protected, the Supreme Court held that oral complaints are covered by the FLSA's anti-retaliation provision when they provide the employer with fair notice under an objective standard.

The Facts and Procedural History

Petitioner Kevin Kasten worked at Saint-Gobain Performance Plastics Corporation's manufacturing facility in Portage, Wisconsin. Employees at the Portage plant punched a Kronos timeclock at the beginning and end of each shift, and when taking lunch. The timeclock Kasten used was positioned inside the area where he and other employees changed in and out of protective gear on a daily basis, which Kasten alleged resulted in employees not being paid for donning and doffing time. Kasten alleged that he made multiple complaints about the timeclocks to Saint-Gobain's management team, beginning with his immediate supervisor and working up to the Operations Manager and Human Resources Manager. In those complaints, Kasten alleged that he specifically stated that he believed the location of the timeclocks was illegal and that he was thinking about filing a lawsuit to challenge the practice. Kasten never complained in writing, contacted the Department of Labor, or instituted a lawsuit while he was employed. All of his alleged complaints were made in face-to-face meetings with his supervisors.

Kasten brought suit against Saint-Gobain, alleging that it retaliated against him after he complained by suspending and then firing him. Saint-Gobain denied that the firing was retaliatory, claiming instead that it fired Kasten for repeated timekeeping infractions that predated his complaints. The District Court for the Western District of Wisconsin granted Saint-Gobain's motion for summary judgment, holding that as a matter of law, the FLSA's anti-retaliation provision, 29 U.S.C. § 215(a)(3), does not protect an employee who makes an oral complaint about FLSA violations to his/her employer. 619 F. Supp. 2d 608 (W.D. Wis. 2008). The Seventh Circuit agreed with the district court that only retaliation in response to a written complaint, which could be filed with the employer, is unlawful under Section 215(a)(3). 570 F. 3d 834 (7th Cir. 2009).

The Legal Issue

The Court granted certiorari on the following question: "Is an oral complaint of a violation of the Fair Labor Standards Act protected conduct under the anti-retaliation provision, 29 U.S.C. § 215(a)(3)?"

The Supreme Court's Opinion

Justice Breyer delivered the opinion of the Court, which was joined by Chief Justices Roberts and Justices Kennedy, Ginsburg, Alito, and Sotomayor. Justice Kagan was recused from consideration of the case.

The Court first examined the text of the FLSA's anti-retaliation provision to determine whether the term "filed any complaint" is limited to written complaints, or encompasses both written and oral complaints. Considering dictionary definitions, as well as legislative, regulatory, and judicial usage of the word "filed," the Court concluded that the statutory text was inconclusive as to whether "filed any complaint" includes oral complaints.

Next, the Court considered various "functional considerations." The Court noted that limiting the anti-retaliation provision only to written complaints would "undermine the Act's basic objectives." The Court also observed that excluding oral complaints from the anti-retaliation provision would reduce the flexibility of federal agencies in enforcing the FLSA, such as preventing agencies from using hotlines and interviews. The Court also pointed out that insofar as the anti-retaliation provision covers complaints made solely to employers excluding oral complaints would discourage use of informal workplace grievance procedures that are desirable to secure compliance with the Act.

Agreeing that the FLSA requires fair notice to employers, the Court adopted an objective standard to determine whether an employee has "filed any complaint." Specifically, the Court acknowledged that filing contemplates a degree of formality, stating "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."

The Court's opinion gave "a degree of weight" to the views of federal administrative agencies responsible for enforcing the FLSA. Looking to the positions taken by the Secretary of Labor and EEOC in briefs, agency publications, and prior enforcement actions, the Court found that the agencies share the view that the words "filed any complaint" cover oral and written complaints. The Court further held that the agencies' positions were reasonable, consistent with the FLSA, and reflected careful consideration.

Finally, the Court declined to address the question of whether a complaint could be "filed" with an employer rather than with the government. The Seventh Circuit had ruled that it could, and the issue was not raised in the certiorari briefs.

The Dissent

Justice Scalia, joined by Justice Thomas, would have addressed the issue that the majority left undecided: The dissent opined that "[t]he plain meaning of the critical phrase and the context in which [it] appears make clear that the retaliation provision contemplates an official grievance filed with a court or an agency." The dissent declined to consider whether such a complaint must be in writing.

In reaching this question, the dissenting Justices took the view that the Court has discretion to consider issues not raised in the certiorari briefs, and that a decision on whether intra-company complaints fall within the statute's protection is "predicate to an intelligent resolution of the question presented." Examining the definitions of the words "complaint" and "filed," the dissent found that in the context of the statutory text, these words refer only to formal statements made to government authorities. Accordingly, the dissent concluded that the text of the statute provides a conclusive answer to the question before the Court.

Justice Scalia expressed the view that the Court owes no deference to agency interpretations of an FLSA provision where, the agencies have no specific authority to make interpretive regulations with respect to the provision, which he believed to be the case here. He opined that no Skidmore deference is due because the agencies' views on this question lack "the power to persuade." Justice Thomas declined to join in Justice Scalia's criticism of the Skidmore doctrine, set forth in footnote 6 of the dissent.

Employee's Perspective

The Kasten decision is a victory for the enforcement of workplace rights under the FLSA. It provides much needed protection to workers whose first response to an illegal pay practice is to attempt an informal and verbal resolution of a matter. The decision settles the unsettled question of whether complaints must be written to be protected activity. However, the Court left employees and their advocates to struggle with some lingering questions.

Kasten continues the Court's recent pattern of preserving strong protections against retaliation for employees. Importantly for FLSA practitioners, the Court's ruling also represents a continued embrace of the economic realities of the workplace in giving the law a broad interpretation. Specifically, the majority recognized that limiting protection to written complaints would " inhibit[] use of the Act's complaint procedure by those who would find it difficult to reduce their complaints to writing, particularly illiterate, less educated, or overworked workers." Majority opin. at 9. This is a nod to Kasten's statement at oral argument that "coal miners, factory workers, line workers-they don't write memos . . . lawyers write memos." By allowing an oral complaint to establish protection under the FLSA, the Court has recognized the reality that at the employee level, many workplaces, including the plastics factory where Kasten worked, do not have a culture of written communication. It is an encouraging sign for employees that a six-Justice majority interpreted the FLSA in light of both its legislative history and the interpretive guidance of the agency tasked with enforcement. Both Congress and the Department of Labor have been protective of employee rights under the FLSA.

The Court leaves employees up in the air, however, on the question of whether to report a pay practice internally. Although the majority declined to reach the question, the objective standard it adopted for evaluating the content of complaints seems to contain an implicit answer. As the dissent pointed out, the standard only makes sense in the context of an intra-company complaint, since a complaint to a judicial or administrative body is by its very nature an assertion of rights. Complaints to one's employer therefore appear to be protected, as long as they meet the objective standard.

Attorneys advising employees should keep in mind that the standard of protection under the FLSA requires something more than "opposing any [unlawful] practice" as is the case under Title VII. See, e.g., 42 U.S.C. § 2000e–3(a). Although an oral complaint is protected, an employee who wants to establish protection against retaliation would still be well advised to document her complaint in writing. It is still unclear whether an employee can risk an internal complaint to the employer before filing a lawsuit or an administrative complaint. The answer may depend on existing law in the relevant circuit.

Employer's Perspective

In Kasten, the Court decided that the phrase "filed any complaint" in the FLSA's anti-retaliation provision may include oral complaints. In answering this narrow issue, however, the Court leaves employers with a number of unresolved issues. Key among those issues is that the Court expressly declined to opine as to whether the FLSA's anti-retaliation provision applies only to complaints filed with the government. Indeed, the only opinion provided by the Court on this issue is offered by the dissent, in which Justices Scalia and Thomas concluded that the anti-retaliation provision does not apply to intra-company complaints. Likewise, while the Kasten opinion applies an objective standard to determine whether a complaint falls within the scope of the anti-retaliation provision, the Court gives little guidance as to what "complaints" will meet this standard. Ultimately, these issues remain open for the lower courts.

Despite the questions the opinion leaves open, it is clear that after Kasten internal oral complaints may be protected activity. As such, employers should take steps to minimize the risks associated with potential retaliation claims. One key step is to train management and human resources personnel on how to appropriately respond to employee complaints. This includes understanding and communicating the employer's policy prohibiting retaliation for good-faith complaints. This also includes utilizing the employer's processes to promptly document and thoroughly investigate employee complaints. Indeed, the importance of this issue is underscored by the Kasten decision, where the parties disagreed as to whether Kasten ever made "significant complaints" (a term used, but not explained, by the Court) concerning Saint-Gobain's timeclocks.

In addition, in order to protect themselves from potential retaliation claims, it is also important that employers consistently document the reasons for appropriate personnel actions. This includes, for example, promptly documenting and communicating employee performance issues, as well as consistently providing detailed, accurate employee performance evaluations. By creating and communicating a clear record of personnel issues, employers reduce the risk that they will be subject to liability for appropriate personnel actions.

Union's Perspective

Unions have long championed the principle that the collective voice of employees is the first line of defense in preventing abuses in the workplace. The Court in Kasten has properly interpreted the FLSA in its historical and practical context, recognizing that a broad prohibition on retaliation is vital to the enforcement of the statute. This decision affirms the centrality of employee action to ensuring that the labor standards protected by the Act are a reality for all American workers. The Kasten decision is consistent with an encouraging recent trend in which the Court has favored employees in statutory anti-retaliation cases, and with the anti-retaliation protections long guaranteed by the National Labor Relations Act.

The Court properly found that the FLSA's purpose is to assist the poorest and least educated workers, and cited the 1948 report of the National War Labor Board (also cited in the amicus brief of the AFL-CIO) to point out that these are the workers most likely to be unable to reduce complaints to writing. In fact, the impact of this ruling may extend beyond the FLSA context. The Migrant and Seasonal Agricultural Worker Protection Act (MSPA/AWPA) prohibits retaliation against employees using the same language as the FLSA. Farmworkers, who rarely work in conditions conducive to filing written complaints, and in many cases do not speak English, are poised to benefit from Kasten.

The amicus brief filed by the AFL-CIO emphasized that the hard-won, long-established union grievance process can serve as a guide to understanding the role of oral complaints. In the unionized workplace, informal, non-written steps often initiate the grievance process. Where such communications touch on FLSA violations, employees who speak up are now granted protection from discharge and discrimination. In addition, oral testimony in arbitration hearings is a regular feature of the unionized workplace. Employees should be able to testify without fear, and this ruling expands the protection available in this context. The Court, in fashioning its "fair notice" standard, may have drawn from the AFL-CIO amicus brief's description of the grievance process. The Court's standard recognizes that informal, non-written discussions provide a workable forum for airing complaints-a forum worthy of protection.

This Hot Topic was prepared by the Federal Labor Standards Legislation Committee of the ABA Section of Labor & Employment Law, with the assistance of Sara Dionne, who represents employers and works in the Sacramento office of Orrick, Herrington & Sutcliffe LLP; Keren Wheeler, who represents unions and union workers in the New York office of Spivak Lipton, LLP; and Michael Scimone, who is a plaintiff employment attorney representing individuals and classes of workers at Outten & Golden LLP in New York.

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American Bar Association Section of Labor and Employment Law
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