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Florida’s Third DCA (Once Again) Narrowly Construes Protected Activity Under the FLSA

Defense lawyers should always remove Fair Labor Standards Act cases to federal court, right?

I thought so until last October, when Florida’s Third District Court of Appeals, relying on the U.S. Seventh Circuit Court of Appeals’ decision in Kasten v. Saint-Gobain Performance Plastics Corp., 570 F.3d 834, 838-40 (7th Cir. 2009), ruled that to “file” a complaint under the FLSA, the employee must complain in writing.  See Alvarado v. Bayshore Grove Mgmt., LLC, 2010 Fla. App. LEXIS 15020 (Fla. 3d DCA 2010).  This decision was at odds with precedent in the U.S. Court of Appeals for the Eleventh Circuit (which covers Florida, Georgia, and Alabama).  I wrote a blog post at the time recommending that defense attorneys reconsider their practice of removing FLSA retaliation cases to federal court.  If the employee did not make a written complaint, the employer was probably better off in state court, where the employer could argue that the employee did not engage in protected activity under the FLSA.  

In March of this year, the United States Supreme Court vacated the Seventh Circuit’s decision in Kasten, holding that oral complaints can suffice under the FLSA.  See Kasten v. Saint-Gobain Performance Plastics Corp., 131 S. Ct. 1325 (U.S. 2011).  I thought that it was back to business as usual, and that defense attorneys should resume their practice of removing FLSA retaliation cases to federal court. 

Now I’m re-thinking that strategy again.  Last week, the Third DCA issued a new decision in Alvarado that acknowledges the Supreme Court’s holding in Kasten, but once again seems to  construe the concept of protected activity under the FLSA more narrowly than Eleventh Circuit precedents.  See Alvarado v. Bayshore Grove Mgmt., LLC, 2011 Fla. App. LEXIS 12136 (Fla. 3d DCA. Aug. 3, 2011).

In Alvarado, the plaintiff described his complaint to his employer as follows:

Just before I was fired on July 11, 2007, I complained to Defendant's management that I was not receiving the correct amount of pay since my time records were altered and/or falsified so as to avoid having to pay me overtime.

The Third DCA held that “[i]t is obvious that this ‘complaint’ fell far short of the degree of specificity and reference to the statute required by the Supreme Court [in Kasten].”  In Kasten, the Supreme Court held that “[t]o fall within the scope of the antiretaliation provision, 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 Alvarado decision once again seems at odds with Eleventh Circuit precedents and other federal court decisions, under which employees can engage in protected activity by complaining about a practice that is regulated by the FLSA without mentioning the FLSA by name.  See, .e.g,  EEOC v. White & Son Enters., 881 F.2d 1006, 1011-12 (11th Cir. 1989) (finding that employees' informal complaints concerning unequal pay, which did not involve citation of the Equal Pay Act or the FLSA, constituted protected activity); Debrecht v. Osceola County, 243 F. Supp. 2d 1364, 1374 (M.D. Fla. 2003) (finding that employees' informal complaints to employer concerning unpaid overtime constituted protected activity under the FLSA). 

I do not believe the Supreme Court’s decision in Kasten changed this legal standard. But apparently, in the Third District Court of Appeals, an employee must do something more than complain about not receiving overtime pay.  That’s good news for employers, and suggests (once again) that employers may be better off defending FLSA retaliation claims in state court. 



Big Enough to Drive a Truck Through? Considering Florida’s “Ulterior Purpose” Exception to the Third Party Requirement of a Tortious Interference Claim

There is no basis for holding an individual liable under Title VII, the Florida Civil Rights Act, or the Florida private sector Whistleblower’s Act.  So, managers and co-workers need not fear being sued for discrimination or retaliation.  Only the employer can be held liable, right?  

Not exactly.  Supervisor and co-workers can be sued under one or more tort theories for conduct that violates one of these laws.  For example, a plaintiff who sues her employer alleging that her supervisor sexually harassed her by groping or fondling her in violation of Title VII can also sue the supervisor for battery.

But what about garden variety discrimination or retaliation claims?  Can the facts that support such a claim also support a claim against the plaintiff’s supervisor or co-worker for tortious interference with a business relationship?  According to a recent decision by Florida’s Third District Court of Appeals, Alexis v. Ventura, Case No. 3D10-2879 (Fla. 3d DCA, June 29, 2011), the answer is yes. 

Ketlyn Alexis was terminated from her job with Arbor E&T, LLC. She filed suit under the Florida Civil Rights Act, claiming that her supervisor, Lilliam Ventura, and others subjected her to a hostile work environment based on her race (black) and national origin (Haitian.). 

Alexis later amended her complaint to add Ventura as a defendant, alleging that Ventura tortiously interfered with an advantageous business relationship that Alexis had with Arbor E&T. In particular, Alexis alleged that Ventura made a number of hostile statements and engaged in a number of hostile acts against Alexis.  For example, Alexis alleged in her complaint that Ventura told other employees: “I am the boss and I am in charge and I’m going to make that Haitian Bitch know it.” Alexis alleged that these statements and acts were motivated by a discriminatory intent to undermine Alexis’ job performance in the eyes of Arbor E&T, and that these statements and acts by Ventura ultimately led to Alexis’ termination by Arbor E&T.

Ventura filed a motion to dismiss this count and to dismiss Ventura as a defendant to the action. Ventura argued that, as a matter of law, Alexis could not state a claim against Ventura for tortious interference with a business relationship because Ventura and Alexis were co-workers. The trial court granted the motion, dismissed the claim, and dismissed Ventura as a party defendant.

On appeal, the Third DCA reversed the trial court’s order.  The court noted that to state a claim for unlawful interference with an advantageous business relationship, Alexis must have alleged the following elements: 1. The existence of a relationship between Alexis and her employer, under which Alexis has legal rights; 2. Ventura’s knowledge of the relationship; 3. An intentional and unjustified interference with that relationship; 4. By a third party; 5. Resulting in damages to Alexis caused by the interference.

The court’s decision turned on the fourth element: whether Ventura could be characterized as a “third party” where she and Alexis were co-employees of Arbor E&T. Generally, the court noted, “in the context of a managerial or supervisory employee terminating a plaintiff’s employment, an action will usually not lie against the terminating employee because he/she is considered a party to the employment relationship.”

But, the court wrote, “[t]here is a recognized exception to this general rule, as explained in O.E. Smith’s Sons, Inc., v. George, 545 So. 2d 298 (Fla. 1st DCA 1989): 

For the interference to be unjustified, the defendant must be a third party, external to the business relationship. However, the privileged interference enjoyed by a party that is integral to the business relationship is not absolute.  The privilege is divested when the defendant “acts solely with ulterior purposes and the advice is not in the principal’s best interest.”  Id. at 299 (quoting Sloan v. Sax, 505 So. 2d 526, 528 (Fla. 3d DCA 1987)) (emphasis supplied).

The court noted further that, “[a]lthough ‘an allegation that [defendant] was maliciously motivated does not by itself mean that [defendant] acted outside the scope of his employment,’ Sloan, 505 So. 2d at 528, an allegation that the defendant was not acting on the employer’s behalf or was acting to its detriment satisfies the “third party” requirement.” 

Because Alexis had made the requisite allegations, the Third DCA ruled that Alexis had stated a claim against Ventura for tortious interference with an advantageous business relationship.

It is, of course, a relatively easy matter for a plaintiff to allege that her supervisor, in discriminating against or retaliating against her in violation of the law, was acting solely with ulterior purposes, and not in the best interests of the employer.  Indeed, while an employer accused of discrimination or retaliation will typically deny such allegations, it will also likely take the position that if its supervisor discriminated against or retaliated against the plaintiff, the supervisor was acting with ulterior purposes and not in the employer’s best interest.  After all, an employer is not going to admit that it encourages or condones unlawful discrimination or retaliation. 

So, it would seem that the “ulterior purpose” exception to the third party requirement of a tortious interference claim is “big enough to drive a truck through,” at least in cases of discrimination or retaliation.

The inclusion of a supervisor as a co-defendant complicates an employer’s case.  Depending on the facts, the supervisor may have to retain separate counsel because of a potential conflict of interest.  And the employer may choose, or be obligated, to pay for the supervisor’s defense, which increases the overall cost of the defense.  If the employer agrees to indemnify the supervisor in the event of an adverse judgment, the employer must realize that there are no automatic caps on damages in a tort claim, unlike claims under Title VII or the Florida Civil Rights Act. 

Plaintiff-side lawyers realize that the addition of a supervisor-defendant typically drives up the settlement value of the case, and may even make a plaintiff’s verdict more likely at trial.  Thus, in the wake of the Alexis case, it seems likely that Florida employers will see an increase in tortious interference claims against their supervisors.  


Mulling the Meaning of an Employee’s “Termination”

Florida’s Third District Court of Appeal, construing a non-compete provision in an employment agreement, ruled this week that the phrase “employee’s termination of employment with the company” “unambiguously refers to the employee’s own termination of his or her employment.” Avisena v. Santalo, Case No. 3D10-178 (Fla. 3d DCA, May 4, 2011) (emphasis supplied). 

The effect of the court’s ruling was that the employee, who had been terminated by the company, was not bound by the longer non-compete restriction that would have applied if he had left on his own accord.  The court, therefore, affirmed the trial court’s denial of the company’s motion for a temporary injunction.

Ironically, I  have heard employees’ attorneys argue that the words "employee's termination” mean precisely the opposite of the Third DCA’s interpretation.  These attorneys say that when an employee’s personnel file reflects an employee’s “termination,” that suggests the company terminated the employee.  According to these plaintiffs’ lawyers, if the employee actually resigned, documenting a “termination” in a personnel file, or in a response to a request for employment verification, could constitute defamation; or, in the case of an employee who had engaged in protected activity before she resigned, retaliation.

I always considered such arguments to be dubious, and still do.  But I also think the Third DCA got it wrong in Avisena.  As Judge Schwartz noted in his dissenting opinion, the word “termination” “simply means the end of given period of time or relationship, regardless of how it occurs.”  The word “termination” and the phrase “employee’s termination” do not unambiguously describe who initiated the termination.  If your employment contracts are premised on the assumption that the word “termination” carries an unambiguous meaning, you may want to revisit those contracts.  Avisena’s attorneys are probably doing that right now.


Third DCA Erases $2.6 Million Racial Discrimination and Retaliation Verdict

Florida’s Third District Court of Appeals has reversed the jury verdict and judgment of a Miami-Dade Circuit Court in favor of the plaintiff for nearly $2.6 million.  Ruling that the plaintiff failed to meet the legal requirements for establishing racial discrimination or retaliation under the Florida Civil Rights Act, the appellate court ruled that the trial judge should have directed a verdict in favor of the employer. The case is Sean St. Louis v. Florida International University, Case No. 3D08-2316 (Fla. 3d DCA, March 30, 2011).

The court’s opinion is straightforward and sensible.  The plaintiff could not establish his discrimination claim, the court ruled, because he could not show that similarly situated employees outside his protected class were treated more favorably.  As for the plaintiff’s retaliation claim, the plaintiff produced no evidence that the decision makers knew of his allegations of discrimination, so they could not have retaliated against him.

The Third DCA’s opinion reads like a federal district court’s order granting summary judgment to the employer.  The difference, of course, is that this case went to trial at great expense to the employer.  That’s not surprising, because state court trial judges, unlike their federal counterparts, are generally reluctant to grant motions for summary judgment before trial, or motions for directed verdict at trial.  That’s why defense counsel remove employment cases to federal court, if possible. Here, that wasn’t possible because there were no federal claims, and there was no diversity of citizenship between the parties.  The saving grace for the employer was that cases under the Florida Civil Rights Act are supposed to be analyzed under the same rigorous standards as federal Title VII claims.  And under those standards, the Third DCA ruled that the employer was entitled to a defense verdict, the jury’s feelings to the contrary notwithstanding.




The Florida Employer

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Michael W. Casey III, Kevin E. Vance, Mark J. Beutler, and Teresa M. Maestrelli practice labor and employment law, with a particular focus on labor and employment litigation, including Title VII, ADEA, ADA, Florida Civil Rights Act, and whistleblower claims, as well as non-compete litigation, in state and federal trial and appellate courts in Florida and throughout the United States. They also represent employers before the National Labor Relations Board (NLRB), the National Mediation Board (NMB), the U.S. Department of Labor, including the Wage and Hour Division and the Occupational Safety and Health Administration (OSHA), the Equal Employment Opportunity Commission (EEOC), and various state and local agencies, as well as in arbitrations, collective-bargaining negotiations and union representation elections. Hector A. Chichoni practices in the area of US and global immigration law. He chairs Duane Morris's Florida Immigration Practice. The editors of Chambers USA 2010 also selected Mr. Chichoni as a "Leader in the Immigration Field." He has represented a vast number of corporate and individual clients throughout his career ranging from premier US health care organizations, Fortune 100 and Fortune 500 companies, multinational corporations and universities to doctors, professors, researchers and students. His international experience includes handling matters relating to export controls and global corporate compliance and business transactions. He has represented clients in a wide variety of cases before the US Immigration Court.
© 2009- Duane Morris LLP. Duane Morris is a registered service mark of Duane Morris LLP.
The opinions expressed on this blog are those of the author and are not to be construed as legal advice.