Emotional Distress That Results From Retaliation is Recoverable Under the FLSA

Pineda v. JTCH Apartments, LLC - Fifth Circuit Court of Appeals

Facts:  Santiago Pineda ("Pineda") and his wife lived in an apartment owned by JTCH Apartments, LLC ("JTCH").  Pineda did maintenance work around the apartment complex in return for a discount on his rent.  Pineda initially filed a lawsuit against JTCH for unpaid overtime in violation of the Fair Labor Standards Act ("FLSA").  Three days after JTCH was served with the summons, Pineda and his wife received a notice to vacate their apartment for nonpayment of rent.  (The amount JTCH demanded was equal to the rent reductions Pineda had received over the course of his employment).  Subsequently, Pineda's wife joined his suit and amended complaint was filed which included a retaliation claim.  

In the following jury trial, Pineda unsuccessfully sought an instruction on emotional distress damages for his retaliation claim.  The jury found in favor of Pineda for both his overtime wage claim and his retaliation claim.  Pineda subsequently appealed on the grounds that at trial, the court should have instructed the jury on damages for emotional harm. 

Holding:  (Note, this analysis focuses only on the issue of whether emotional distress resulting from retaliation is recoverable under the FLSA).  The Fifth Circuit began its review of the case with an examination of the language of the FLSA in regard to the remedies available for retaliation claims:  "Any employer who violates the provisions of section 215(a)(3) of this title shall be liable for such legal or equitable relief as may be appropriate to effectuate the purposes of section 215(a)(3) of this title, including without limitation employment, reinstatement, promotion, and the payment of wages lost and an additional amount as liquidated damages."  The Court noted that although it had never considered whether this statutory language allows a plaintiff to recover for emotional injuries, two other circuits had ruled in the affirmative (the Sixth and Seventh Circuits).  (However, note that other district courts in the Fifth Circuit have previously held that damages for emotional distress in retaliation suits is not available.)  In addition, other circuits had previously upheld jury awards for emotional damages in FLSA retaliation cases, although those cases were not challenged on appeal (the First, Eighth, and Ninth Circuits).

Prior to the 1977 amendments to the FLSA, plaintiffs only had a cause of action for minimum wage and overtime violations.  The remedies provision was subsequently added to the FLSA in 1977 to allow employees the ability to recover not just wages and liquidated damages but also "such legal or equitable relief as may be appropriate."  (The Seventh Circuit has interpreted this expansive language to include compensation for emotional distress as an available remedy in regard to retaliation causes of action). The Court acknowledged a disagreement among district courts in the Fifth Circuit over the issue.  The Court pointed out that the disagreement arose out of prior Fifth Circuit opinions which stated that the remedies provision of the FLSA and the Age Discrimination in Employment Act ("ADEA") should be interpreted consistently.  As a result, based upon a 1977 Fifth Circuit case that held emotional distress damages were not available under the ADEA, some courts had interpreted this to mean emotional distress damages were also not available under the FLSA.  The Court clarified this confusion and pointed out that when the 1977 case, Dean v. American Security Insurance Co., considered whether the ADEA afforded a remedy for emotional distress, it was looking at the pre-1977 FLSA (which limited relief to economic damages a did not allow for private retaliation claims). 

Further, the Court clarified that it has never considered the language of the ADEA to automatically apply to the FLSA.  Although the ADEA incorporates portions of the FLSA, the FLSA does not incorporate the ADEA.  Consequently, the Court pointed out that the issue remained whether there was a factual basis for instructing the jury on the type of damage instruction that Pineda had requested (and whether Pineda had proven any harm at trial). 

Judgment:  The Fifth Circuit Court of Appeals reversed and remanded the decision of the trial court and held that a jury instruction should have been given as Pineda requested, as emotional distress that results from retaliation is a recoverable damage under the FLSA.

The Takeaway:  For those readers who enjoy an intensive parsing of the language of a statute and how amendments can impact causes of action/recoverable damages, this case should be right up your alley.  For other readers (such as those in H.R.) who might deal with retaliation claims more frequently, take note of this ruling.  Although there is some disagreement over whether emotional distress is a recoverable damage under the FLSA in retaliation claims, it certainly appears that many circuits are moving in that direction.  While rulings from district courts provide some guidance, when a case such as this comes along from a Court of Appeals, it is important to read through the opinion and take note that the Court's ruling will likely overrule what district courts in that circuit have decided upon.  In particular, a ruling such as this provides employees with a much larger possible recovery in a retaliation suit...I hope employers that are reading this note keep this case in mind going forward.

Majority Opinion Judge:  Judge Costa

Date:  December 19, 2016

Opinion:  hr.cch.com/eld/PinedaJTCH121916.pdf