United States Court of Appeals,
Eleventh Circuit.
No. 94-2075.
Robert B. REICH, Plaintiff-Appellant,
v.
John C. DAVIS, Individually d/b/a John C. Davis, P.A., Defendant-
Appellee.
April 26, 1995.
Appeal from the United States District Court for the Middle
District of Florida. (No. 91-170-CIV-FTM-23D), L. Clure Morton,
Visting Judge.
Before CARNES, Circuit Judge, DYER and GUY1, Senior Circuit Judges.
CARNES, Circuit Judge:
The Secretary of Labor sued on behalf of two employees,
claiming that their employer had discharged them in retaliation for
the exercise of their rights under the Fair Labor Standards Act
("FLSA"). After a bench trial, the district court entered judgment
in favor of the employer. We vacate and remand for clarification
by the district court.
I. FACTS
Darlene Smiley and Cynthia Fellows were two of the five
employees who worked for John Davis, a certified public accountant.
Davis properly paid his employees overtime at one-and-a-half times
their wages during the tax season, which lasted roughly from
January to April. For the rest of the year, however, Davis did not
pay his workers extra wages for working overtime. Instead, during
that period he allowed his employees "compensatory leave": they
1
Honorable Ralph B. Guy, Jr., Senior U.S. Circuit Judge for
the Sixth Circuit, sitting by designation.
received one hour off for every hour of overtime worked. It is
undisputed that Davis's method of compensating his employees by
awarding them compensatory leave time instead of extra wages
violated the FLSA.
In the fall of 1986, Smiley asked Davis to pay her the extra
wages to which she was entitled, but Davis refused. Smiley filed
a written complaint against Davis with the Wage and Hour Division
of the Department of Labor on October 6, 1987. A Wage and Hour
Division investigator examined Davis's pay practices, interviewed
Smiley and Fellows, and informed Davis that his system of using
compensatory leave in lieu of extra wages for overtime was
unlawful. Davis computed the unpaid overtime wages he owed each of
his five employees and on September 20, 1988, mailed back wages
checks to three of them. Three days later, Davis called Smiley and
Fellows into his office. He handed them their back wages checks
and fired them.
Following their discharge, Smiley and Fellows both filed
successful state unemployment compensation claims against Davis.
In contesting their claims, Davis listed on an unemployment
compensation form several reasons why he discharged them. One of
the reasons Davis listed for both Smiley's and Fellows's discharge
was "conspiracy with another employee to file [a] false claim with
the Federal Wage and Hour Board." His position was that they had
conspired with each other to file a false claim with the Wage and
Hour Division.
The Secretary of Labor brought this lawsuit to permanently
enjoin Davis from violating § 15(a)(3) of the FLSA, 29 U.S.C. §
215(a)(3), which prohibits an employer from discharging an employee
in retaliation against the employee's filing a complaint with or
testifying in an investigation led by the Wage and Hour Division.
The Secretary also requested other relief, including an order
requiring Davis to offer reinstatement to Smiley and Fellows, and
an order "restraining the withholding by [Davis] of wages lost by
reason of" Smiley's and Fellows's discharge. The district court
entered judgment in favor of Davis. The only explanation we have
of the reasoning behind the district court's judgment is a
memorandum opinion which, in its entirety, states as follows:
The Secretary of Labor brings this suit against the
defendant pursuant to the Fair Labor Standards Act. Among
other allegations, the defendant is charged with discharging
two employees, Cynthia B. Fellows and Darlene Smiley, because
they exercised their rights under the Fair Labor Standards
Act. He asserted that the discharged employees filed false
claims that "he did not pay overtime." In fact, this
information was given to him by the government inspector, and
he relied on it, although it was only half true. The court
accepts defendant's explanation for the reason he used this
half truth as a ground to defeat the unemployment compensation
claim.
Defendant had a practice of paying overtime compensation
during the tax season. Overtime after the tax season was
treated as comp time which the employee could use for vacation
or time off with regular pay. That issue has no bearing on
this case. On audit the defendant complied with the Fair
Labor Standards Act and paid the employees what they were
entitled to, plus penalty. This is a dead issue.
The only matter before the court is whether the two
employees were fired because they initiated the investigation
of their lack of payment of overtime. After listening to all
the witnesses, pro and con, and judging their credibility, the
court finds that the plaintiff has failed to sustain its
burden of proof. Therefore, judgment will be entered for the
defendant.
Davis maintains on appeal, as he did in the district court,
that Smiley's claim was false because Davis did pay a significant
amount of overtime during tax season. In addition, Davis contends
that even before he heard of the FLSA complaint, he was planning to
fire both employees because of their poor work habits and poor work
product. These reasons, Davis argues, were the motivating factors
that led to the discharge.
II. DISCUSSION
At issue is the proper interpretation of § 15(a)(3) of the
FLSA, which 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 this chapter, or has testified or is about to
testify in any such proceeding, or has served or is about to
serve on an industry committee....
29 U.S.C.A. § 215(a)(3) (1965). We review both questions of law
and a district court's application of law to the facts de novo.
See In re Sloma, 43 F.3d 637, 639 (11th Cir.1995) (questions of
law); Reich v. Department of Conservation and Natural Resources,
28 F.3d 1076, 1085 (11th Cir.1994) (applications of fact).
A. WHETHER THE FLSA CLAIM WAS "FALSE"
As an initial matter, Davis's contention that Smiley and
Fellows conspired to file a false claim is utterly meritless.
According to a pre-trial stipulation, Smiley filed a claim that
Davis did not pay overtime. That claim was not false, because for
eight months of the year, Davis did not pay overtime. There is no
evidence that either Smiley or Fellows said that Davis never paid
overtime. It therefore would be clear error to find that Smiley
and Fellows conspired to file a false claim, or that they did file
a false claim. Davis was mistaken if he believed that the claim
was false, and he—not Smiley or Fellows—should bear the
consequences of his mistake.
Moreover, the truthfulness of the complaint that Smiley and
Fellows filed is evidenced by its result: an award of back wages
to Davis's employees. The anti-retaliation provision of the FLSA
would be toothless indeed if it did not prevent an employer from
discharging an employee for the filing of a successful claim. We
reject the notion that an employer may fire a worker who files a
successful claim merely because the employer decides that his
violation of the law was not quite as extensive as the employer
thinks the employee has alleged. The FLSA was designed to protect
the rights of employees, not the feelings of employers.
B. APPLICATION OF THE "IMMEDIATE CAUSE" OR "MOTIVATING FACTOR"
TEST
Davis also argues that he did not violate the
anti-retaliation provisions of the FLSA because the filing of the
claim was not the reason he fired Smiley and Fellows. The record
establishes without dispute, however, that Davis did list the
filing of the claim (i.e., the "conspiracy ... to file a false
claim") as one of the reasons he fired the two employees. To the
extent that the district court's rather cryptic opinion finds to
the contrary, that finding is clearly erroneous. See Anderson v.
City of Bessemer, N.C., 470 U.S. 564, 575, 105 S.Ct. 1504, 1512, 84
L.Ed.2d 518 (1985) (despite substantial deference due trial court's
factfindings based upon credibility determinations, appellate court
may find clear error where the story of the witness credited by
trial court is contradicted by documentary evidence). One of the
reasons Davis gave for firing Smiley and Fellows, the filing of the
claim, was an improper reason. However, our analysis does not end
here.
Alternatively, Davis argues that the improper reason was not
a "but for" cause of Reich's and Fellows's discharge. It is
possible that the district court agreed with him on this ground.
In other words, the district court may have decided that Davis
truly had been planning to fire Smiley and Fellows on September 23,
1988, and that they would have been discharged on that date even if
no complaint had been filed. There is some evidence in the record
to support Davis's factual premise. For the reasons below, we do
accept Davis's legal premise: that retaliation must be the "but
for" reason for Smiley's and Fellows's termination before they are
entitled to any relief under § 15(a)(3) of the FLSA.
We reach our decision based upon our interpretation of this
circuit's precedent and the purpose of the anti-retaliation
provision. The FLSA makes it unlawful for an employer to fire an
employee "because" the employee asserted rights protected under the
statute. In deciding what meaning we should apply to the term
"because," and whether Smiley's and Fellows's discharge fell within
that meaning, we are guided by Goldberg v. Bama Manufacturing
Corp., 302 F.2d 152 (5th Cir.1962), where we stated:
There is no doubt in our minds that the record fully supports
the district court's finding that there were half a dozen
reasons why [the employee] should have been discharged.
Nevertheless, the fact remains that the immediate cause of her
discharge was the assertion of a statutory right, the exercise
of which is protected from reprisals.
Id. at 154. Thus despite the existence of legitimate business
reasons for discharging one who we agreed "was an incompetent,
dishonest employee," id. at 156, we held in Goldberg that a
violation of the FLSA occurs when the "immediate cause" of
discharge is retaliation. Other circuits have similarly applied an
"immediate cause or motivating factor" test to determine whether an
employer who later produces legitimate business reasons for the
discharge nonetheless violated § 15(a)(3). See Martin v.
Gingerbread House, Inc., 977 F.2d 1405, 1408 n. 4 (10th Cir.1992);
Love v. RE/MAX of America, Inc., 738 F.2d 383, 387 (10th Cir.1984);
Brennan v. Maxey's Yamaha, Inc., 513 F.2d 179, 181 (8th Cir.1975).
In Goldberg, we applied the "motivating factor" test in a "but
for" way. The Tenth Circuit has followed the same approach,
holding that "the discharge is unlawful only if it would not have
occurred but for the retaliatory intent." Martin, 977 F.2d at 1408
n. 4. In Martin, the Tenth Circuit affirmed a ruling that the
discharge was not retaliatory, despite the employer's statement
that "people who are loyal don't call the labor department,"
because other valid reasons would have led to the same result. Id.
at 1408-09. The "but for" interpretation still serves the
statutory purpose of encouraging employees to report violations of
the FLSA. Only those employees who would have suffered exactly the
same adverse action even if they had not engaged in FLSA activities
will be unprotected under the "but for" test. We therefore hold
that the "motivating factor" test is equivalent to a "but for"
standard.
Applying the Goldberg "motivating factor" or "but for" test
to this case means that Smiley and Fellows are entitled to relief
only if they establish that the filing of the complaint with the
Wage and Hour Division, or their cooperation in the ensuing
investigation, caused them to suffer adverse action that they
otherwise would not have suffered. The relief to which they are
entitled is commensurate with the extent of the adverse action they
suffered as a result. If they establish that they would not have
been fired at all but for their protected activities, then they are
entitled to reinstatement and full back pay.
By contrast, if the evidence establishes that Smiley and
Fellows eventually would have been fired anyway, but not as soon as
they were, then they are not entitled to reinstatement; they are
entitled only to back pay for the period of time that they would
have been employed but for their protected activity.2 Fitting the
relief to the consequences of the employees' participation in
protected activity balances the important interest of protecting
employee participation in protected activity against the employer's
interest in not being saddled with unsatisfactory employees, who
would have been fired anyway, just because they engage in protected
activities.
A remand is necessary in this case. To the extent that the
district court found that Smiley's and Fellows's participation in
protected activities was not a reason Davis terminated them, that
finding is clearly erroneous. On the state unemployment
compensation form, Davis listed their activities in relation to the
Wage and Hour claim—which proved to be valid—as a reason they were
terminated. On remand, the district court is to take that fact as
established and proceed to a factual determination of whether
Fellows and Smiley would have been fired anyway and, if so, when.
If the district court finds that either or both of them would not
2
If it is established that Smiley or Fellows suffered any
adverse action because of protected activities, the Secretary
would be entitled to the injunctive relief he seeks.
have been fired, or would not have been fired as soon as they were,
but for their participation in protected activities, the court is
to grant commensurate relief to them and such additional
appropriate injunctive relief as the Secretary is entitled to
receive.
III. CONCLUSION
The district court's opinion is VACATED and the case is
REMANDED for further proceedings consistent with this opinion.