The U.S. Court of Appeals for the First Circuit (First Circuit) recently overturned an employer's summary judgment victory in a Fair Labor Standards Act (FLSA) retaliation case, finding that the CEO's alleged repeated statements that he wanted to fire the lead plaintiff in a collective action could have created an awareness among decision-makers of the CEO's desire to retaliate, even though there was no direct evidence that the CEO had any involvement in the decision to terminate the plaintiff, or that the decision-makers were even aware of the CEO's alleged statements.
In Travers v. Flight Servs. & Sys., Inc., a skycap recruited coworkers to join a collective action alleging failure to pay minimum wage. In multiple conversations with the plaintiff's then-supervisor and other witnesses, the CEO allegedly complained about the expense of the lawsuit and stated a desire to terminate the plaintiff's employment. Subsequent to those alleged statements, a customer complained that the plaintiff had solicited a tip in violation of company policy. The plaintiff admitted that he had advised the customer that tips were optional and not included in the established fees, and that he said something to the effect of "I'm sorry you weren't happy with the service" when the customer declined to tip. The company terminated the plaintiff, citing a policy stating that tip solicitation was a terminable offense. The CEO was not directly involved in that decision.
The U.S. District Court for the District of Massachusetts granted summary judgment in the company's favor. On appeal, the First Circuit overturned that decision, finding that a reasonable jury could conclude that the CEO's alleged comments – which came from "the apex of the organizational hierarchy" – had become well-known to others within the organization. Furthermore, the First Circuit found that there was insufficient evidence that the termination would have occurred regardless of the CEO's alleged animus. The Court noted that the company's policy did not bar employees from informing customers that tips are appreciated, and that the company had not terminated other employees who had allegedly solicited tips.
The First Circuit limited its holding, stating that while the evidence did not conclusively establish an inference of retaliation, the evidence was "not so clear as to place beyond reasonable challenge" the company's assertion that it would have terminated plaintiff's employment regardless of the CEO's alleged comments.
The Travers case is a cautionary tale that the statements of an executive at the "apex of organizational hierarchy" may be considered evidence of retaliatory animus, even if the executive plays no role in the decision-making process and there is no direct evidence that the decision-makers are actually aware of the executive's comments. However, this fact-specific decision should not foreclose summary judgment in cases involving stray comments if the employer can present stronger comparators and other persuasive evidence that the discipline would have occurred regardless of any alleged retaliatory intent.