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Liquidated Damages In FLSA Retaliation Claims Are Not Mandatory

Is it a requirement to award liquidated damages in a wage and hour retaliation case?  The question has been raised before and rejected.  It has now been rejected again.  This time, in Moore v. Appliance Direct, Inc., 2013 U.S. App. LEXIS 3047 (11th Cir. Feb. 13, 2013), the Eleventh Circuit held that the plain language of the Fair Labor Standards Act (FLSA) makes the award of liquidated damages discretionary and agreed with the Sixth and Eighth Circuits, the two other appellate courts that have considered the issue.

Section 216(b) of the FLSA provides that:

 “Any employer who violates the provisions of section 206 or section 207 of this title [minimum wage or overtime provisions] shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages. Any employer who violates the provisions of section 215(a)(3) of this title [retaliation provision] 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 equal amount as liquidated damages.”

29 U.S.C. § 216(b) (emphasis added).

The question of willfulness technically governs an employee’s entitlement to liquidated or double damages.  As a practical matter, however, most courts award such damages based on the “strong [statutory] presumption … in favor of doubling.”  Shea v. Galaxie Lumber & Const. Co., 152 F.3d 729, 733 (7th Cir. 1998).  See also Herman v. Hogar Praderas de Amor, Inc., 130 F. Supp. 2d 257, 267 (D.P.R. 2001) (“Th[e] burden on the employer is a difficult one to meet. Double damages will be the norm, and single damages will be the exception.”).

Under this approach, liquidated damages are mandatory for FLSA violations involving minimum wage or overtime violations, unless the employer proves that it acted in good faith and had reasonable grounds to believe that its conduct was consistent with the law.  See, e.g., Chao v. Barbeque Ventures, LLC, 547 F.3d 938, 942-43 (8th Cir. 2008); Alvarez Perez v. Sanford Orlando Kennel Club, Inc., 515 F.3d 1150, 1163 (11th Cir. 2008); Braswell v. City of El Dorado, 187 F.3d 954 (8th Cir. 1999).

But what about FLSA retaliation claims, which fall under Section 215(a)(3) of the Act?  Braswell v. City of El Dorado, Ark., supra, and Blanton v. City of Murfreesboro, 856 F.2d 731 (6th Cir. 1988), considered the issue and held that the language of Section 216(b) stating that the award of “such legal or equitable relief as may be appropriate to effectuate the purposes of section 215(a)(3) of this title . . .” provides discretion on the part of the district court in the award of liquidated damages.

In Moore, the Eleventh Circuit considered the argument of three delivery drivers who had settled overtime claims, but sued for FLSA retaliation when they were not offered the opportunity to become independent contractors when the company outsourced its delivery duties.  The jury returned a verdict of $30,000 for each driver.  The court denied their request for liquidated damages.  On appeal, the Eleventh Circuit, relying on the district court’s “well-reasoned opinion” as well as Braswell and Blanton, held that the “as may be appropriate” language was clear – the decision is left to the discretion of the district court.

The court concluded:  “[W]e join the Sixth and Eighth Circuits in holding that the second sentence in section 216(b), which allows such damages ‘as may be appropriate to effectuate the purposes of [the retaliation provision],’ creates a separate, discretionary, standard of damages for retaliation claims. We therefore hold that the retaliation provision of 29 U.S.C. § 216(b) gives the district court discretion to award, or not to award, liquidated damages, after determining whether doing so would be appropriate under the facts of the case. The district court made the determination in this case that it would not be appropriate, and in declining to award liquidated damages it did not abuse its discretion.”  2013 U.S. App. LEXIS 3047 at *23.

 

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