On March 22, 2011, the United States Supreme Court held that the Fair Labor Standards Act's prohibition on retaliation against employees who "file" complaints includes both oral and written complaints. Kasten v. Saint-Gobain Performance Plastics Corp., No. 09-834, 2011 U.S. LEXIS 2417 (U.S. Mar. 22, 2011). To be considered protected activity, 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," according to the Court. Although the complaint in Kasten was allegedly made directly to the employer, the Court did not decide whether the FLSA's antiretaliation provision protects employees who make complaints to their employer or whether the complaints must instead be filed with the government. That issue, and the issue of what level of communication by an employee will be deemed sufficient to constitute a "complaint" under this standard, are left open to be addressed by the lower courts. While these issues are grappled by the lower courts, employers are advised to have appropriate processes in place to record and promptly address employee complaints.
A Circuit Split
Kasten arose from plaintiff Kevin Kasten's claim that he was terminated by his employer, defendant Saint-Gobain Performance Plastics Corp., in retaliation for making an oral complaint to his employer about the location of Saint-Gobain's time clocks. Kasten believed the time clocks prevented employees from receiving credit for time spent changing in and out of work clothes. Kasten claimed that he followed Saint-Gobain's internal grievance-resolution procedure by raising his concerns with his shift supervisor, a human resources employee, the human resources manager, and the operations manager. Saint-Gobain denied that Kasten had made a significant complaint about the time clocks, and contended it terminated Kasten because he failed to clock in and out after repeated warnings.
The FLSA's antiretaliation provision makes it unlawful: "to discharge or in any other manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to [the Act], or has testified or is about to testify in such proceeding, or has served or is about to serve on an industry committee…" 29 U.S.C. § 215(a)(3) (emphasis added). Relying on this provision, Saint-Gobain moved for judgment as a matter of law, arguing that Kasten had not "filed any complaint." The U.S. District Court for the Western District of Wisconsin agreed, granting the Saint-Gobain's motion.
On appeal, the Seventh Circuit Court of Appeal affirmed, finding that Kasten did not engage in protected activity under the FLSA's antiretaliation provision. In contrast, other circuit courts have found the FLSA's antiretaliation provision covers oral complaints. In light of this split, the U.S. Supreme Court granted certiorari in Kasten to determine whether an oral complaint constitutes protected activity under the FLSA.
The Majority Opinion
In a 6-2 decision, Justice Breyer delivered the opinion of the Court. The opinion opens by examining the statutory text in an effort to discern whether the phrase "filed any complaint" is limited to written complaints, or encompasses both written and oral complaints. Considering the word "filed" in a variety of contexts, the Court concluded that the language of the provision was open to competing interpretations.
Finding that the statutory text failed to conclusively answer the question as to whether oral grievances are protected activity, the Court went on to "functional considerations." First, the Court considered the purpose of the FLSA, holding that a more restrictive interpretation would undermine the Act's basic objectives. Next, the Court noted that excluding oral complaints from the antiretaliation provision would reduce agency flexibility in enforcing the FLSA, such as limiting the ability of government agencies to use hotlines and interviews to receive complaints. The Court also pointed out that insofar as the antiretaliation provision applies to complaints made to employers (which the Court expressly declined to decide), excluding oral complaints would discourage the use of informal workplace grievance procedures.
In addition to these "functional considerations," the Court also gave "a degree of weight" to the views of federal administrative agencies responsible for enforcing the FLSA, specifically the Secretary of Labor and the EEOC. Both of these federal agencies share the view that oral complaints are protected activity.
The Court agreed with Saint-Gobain's assertion that the FLSA seeks to establish an enforcement system that is fair to employers by providing them sufficient notice that an employee is making a complaint. Accordingly, the Court held that the phrase "'filed any complaint' contemplates some degree of formality, certainly to the point where the recipient has been given fair notice that a grievance has been lodged and does, or should, reasonably understand the matter as part of its business concerns." The Court thus adopted the standard that in order for a complaint to "fall within the scope of the antiretaliation provision, [it] 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 did not give further guidance on which oral and written complaints are protected activity, nor did it decide whether intracompany complaints constitute protected activity.
Justice Scalia, largely joined by Justice Thomas, dissented and criticized the majority's decision not to address the issue of whether an intracompany complaint constitutes protected activity. The dissent concluded that Kasten's suit should fail because the FLSA's antiretaliation provision does not cover any complaint to an employer. Rather, the dissent contended that the term "complaint" has a specialized meaning in the legal context, which is limited to a formal allegation or charge to an appropriate court or officer.
Implications for Employers
Although the majority opinion in Kasten expressly declined to decide whether complaints to an employer (rather than the government) are covered by the FLSA's antiretaliation provision, the holding does make clear that oral complaints may be protected activity. The reach of this holding – i.e., what types of oral complaints will be deemed to be sufficiently clear and detailed – remains unclear. Nonetheless, given the Court's ruling, employers should take steps to appropriately handle employee complaints and diligently manage performance issues to document the reasons for personnel decisions. Thus, for example, employers should:
- Train management and human resources personnel who are in a position to receive oral complaints from employees.
- Have appropriate processes in place to promptly record and address employee complaints.
- Clearly communicate the employer's policy prohibiting retaliation for raising a good-faith complaint.
- Promptly and consistently document employee performance and personnel issues.
- Consistently provide detailed and accurate employee performance evaluations.