The Eleventh Circuit decided an interesting FLSA retaliation case this week, Moore v. Appliance Direct, Inc. I have noticed an uptick in the filing of those kinds of suits in recent months/years, so this decision is significant. The facts are basic - the three employee plaintiffs were delivery drivers for Appliance Direct, and filed an FLSA overtime suit while they were still employed. During the pendency of the case, Appliance Direct fired the three drivers. The company claimed that it had outsourced those jobs. The drivers, as you might expect, filed an FLSA retaliation suit against the company and its CEO. After some procedural machinations, the retaliation case against the CEO went to jury trial. The jury found in favor of the drivers, and awarded each $30,000 in damages. The Court declined to award plaintiffs an additional amount in liquidated damages.
Under the FLSA's overtime and minimum wage provisions, a plaintiff's entitlement to liquidated damages - or, double damages - is a question for the judge, and it depends on whether the defendant company acted in good faith. For example, a jury may award an FLSA overtime plaintiff a certain sum in unpaid overtime, say $10,000. If the judge determines that the defendant failed to prove that it acted in "reasonable good faith" with respect to the pay decisions, then an award of liquidated damages (an additional $10,000 in this example) is mandatory.
In Moore, the Eleventh Circuit considered whether the same is true in an FLSA retaliation case, and decided that it is not. The Court noted that the text of the anti-retaliation provision differs from the text of the unpaid wages provisions, and determined that liquidated damages are discretionary in retaliation cases, even where the defendant has failed to prove it acted in good faith with respect to the alleged retaliatory conduct. The Court stated that the FLSA "gives the district court discretion to award, or not award, liquidated damages, after determining whether doing so would be appropriate under the facts of the case."
The Court did not explain when it would be appropriate to award liquidated damages in a retaliation case, but it is safe to say that it depends on whether the company has any explanation (other than a retaliatory one) as to why it fired (or took other adverse action) against the employee. An employer who has no explanation for the employment decision will probably be assessed liquidated damages. On the other hand, an employer who has a reasonable, non-retaliatory explanation (with contemporaneous written documentation of the decision) may be able to avoid liquidated damages, even when that explanation was insufficient to convince the jury to find in its favor. The real takeaway from this case is that it is more important than ever for employers to do their duty and document the reasons for terminations.