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3d Cir.: FLSA Retaliation Provisions Protect Anticipated Collective Action Opt-ins

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Uronis v. Cabot Oil & Gas Corp.

Resolving an issue of first impression, the Third Circuit recently held that a job applicant who was a potential member of a collective action, was entitled to the protections of the FLSA anti-retaliation provisions.

The FLSA prohibits discrimination against employees who have engaged in “protected activity” which, in part, includes having “testified” or being “about to testify” in any FLSA-related proceeding. 29 U.S.C. § 215(a)(3). However, until the Third Circuit’s recent decision, it was unclear whether an employee or potential employee’s status as a potential member of a collective action protected him or her from retaliation under the FLSA. The Third Circuit held that it does, and reversed the lower court’s opinion which had dismissed the Complaint and held that it did not.

In this case, a former coworker of plaintiff Matthew Uronis filed a collective action lawsuit against both Cabot Oil & Gas Corporation and a transport and rental company, claiming that the two companies were joint employers and that they failed to properly pay overtime to members of the class, in violation of the FLSA, in February 2019. Uronis, who was similarly employed by the same transport and rental company (and arguably jointly employed by Cabot), was allegedly similarly situated to the named-Plaintiff in that case, based on the definition of the putative collective action contained within the complaint in the initial case.

Subsequent to February 2019, in August 2019, Uronis alleged that he applied for a position with GasSearch Drilling Services Corporation (GDS), a subsidiary of Cabot. In response, on August 28, 2019, a GDS manager sent Uronis a text message stating that, despite his clear qualifications, GDS could not hire Uronis because he was a putative member of the collective action lawsuit against Cabot and the transport and rental company. That same day, Uronis signed his consent to join the collective action. However, he had not informed anyone at Cabot or GDS that he planned to join the lawsuit.

Following GDS refusal to hire him, based on his status a potential opt-in plaintiff, Uronis filed his own lawsuit, against Cabot and GDS, alleging they violated Section 215(a)(3) of the FLSA when GDS refused to hire him and others because they were “about to testify” in his former coworker’s lawsuit. Uronis referenced the text message from the GDS manager and attached a copy to his Complaint.

In response to the Complaint, the defendants filed a motion to dismiss on the basis that Uronis had not pled conduct constituting protected activity under Section 215(a)(3). The district court agreed, granted the defendants’ motion, and dismissed the case.

The district court concluded that Uronis was not “about to testify” because he had not alleged he was scheduled to provide testimony in the underlying collective action. On appeal, the Third Circuit reversed.

Noting first that “Congress included in the FLSA an antiretaliation provision . . . to encourage employees to assert their rights without ‘fear of economic retaliation [which] might often operate to induce aggrieved employees to quietly accept substandard conditions,” the Third Circuit stated that the FLSA “must not be interpreted or applied in a narrow, grudging manner.” In support of this position, the Court of Appeals cited to the U.S. Supreme Court’s decision in Kasten v. Saint-Gobain Performance Plastics Corporation, 563 U.S. 1 (2011), in which the Court held that an oral complaint of an FLSA violation constitutes protected activity, even though the statute (in a companion subsection) refers to a complaint that has been “filed,” which most commonly is interpreted to require a written document.

In so holding, the Supreme Court reasoned that to limit the scope of Section 15(a)(3) to the filing of written complaints would foul Congress’ intent by ‘prevent[ing] Government agencies from using hotlines, interviews, and other oral methods of receiving complaints’ and ‘discourag[ing] the use of desirable informal workplace grievance procedures to secure compliance with the [FLSA].’” The Court further noted that it had interpreted an analogous provision of the National Labor Relations Act (NLRA) to protect conduct not explicitly listed in that NLRA, specifically, to extend anti-retaliation protection to individuals who merely had participated in a National Labor Relations Board investigation, even though the language of the NLRA itself referred only to those who had “filed charges or given testimony.”

The Court of Appeals further noted that previously, in Brock v. Richardson, 812 F.2d 121 (3d Cir. 1987), it had extended the protections of Section 215(a)(3) to individuals whom the employer believed had filed a complaint with the Department of Labor, even though they had not actually done so. “Even though the statute could be narrowly read to not include retaliation based on perception, such retaliation ‘creates the same atmosphere of intimidation’ as does discrimination based on situations explicitly listed in Section 15(a)(3),” the Court of Appeals reiterated, adding that “[s]uch an atmosphere of intimidation is particularly repugnant to the purpose of the FLSA in the context of collective actions.” Similarly, “[i]f employers can retaliate against an employee because the employer believes the employee has or will soon file a consent to join an FLSA collective action, this enforcement mechanism – and employee protection – will be gutted.

However, added the Third Circuit, “Section [2]15(a)(3) is not a per se bar against any adverse employment action against an employee who is or might soon be a collective action member. Rather, it bars discrimination because of protected activity.” Again citing to Kasten, the Court of Appeals emphasized that to qualify as arguably protected activity, the employer must be given “fair notice” that a reasonably detailed and clear complaint, whether oral or written, has been asserted (as in Kasten) or, as here, that the individual was “about to testify” in an FLSA proceeding (as the Third Circuit now broadly interprets that phrase) and there must be plausible evidence (or allegations) that the employer was aware of the conduct.

Reversing the district court, the Third Circuit explained:

The reasoning of Kasten and Brock compel the conclusion that to ‘testify’ under Section [2]15(a)(3) includes the filing of an informational statement with a government entity. A consent to join a collective action is just that: it is an informational statement (that an employee is similarly situated to the named plaintiff with respect to the alleged FLSA violation) made to a government entity (the court).

Accordingly, concluded the Third Circuit, “an employee testifies under Section [2]15(a)(3) when the employee files a consent to join an FLSA collective action.”

Likewise, the Court of Appeals held that “‘about to testify’ includes testimony that is impending or anticipated, but has not been scheduled or subpoenaed.” As set forth in several other district court decisions, “‘about to’ . . . includes activity that is ‘reasonably close to, almost, on the verge of,’ or ‘intending to do something or close to doing something very soon.’” This includes individuals who, like Uronis, intended to soon file his consent to join the collective action and testify in that lawsuit, the Third Circuit noted. Finally, the Court of Appeals held, Uronis had sufficiently pled – as evidenced by the text to him from the GDS manager – not only that Cabot and GDS were aware, or at least assumed, that he would join the collective action, but that GDS was flatly refusing to hire him for this very reason. Based on these allegations, “[i]t is plausible that [GDS would not hire Uronis] because they anticipated [he] and his former co-workers would soon file consents to join the putative collective action, or otherwise provide evidence relating to it.” Accordingly, the Third Circuit said, the complaint should not have been dismissed on the pleadings and the case was due to be remanded for further consideration.

Congratulations to Morgan & Morgan attorney Angeli Murthy for her outstanding advocacy on behalf of Uronis! Ms. Murthy was supported by the Department of Labor who filed amicus in support of Uronis as well.

Click Uronis v. Cabot Oil & Gas Corp. to read the entire decision.

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