On Monday, a unanimous three-judge panel ruled that workers who sue for retaliation under the Fair Labor Standards Act (FLSA) may recover emotional damages, but not their spouses. The 5th Circuit Court of Appeals joins the 6th and 7th Circuits in allowing for the recuperation of emotional damages for retaliation claims under the FLSA.
The 5th Circuit in Pineda v. JTCH Apartments LLC upheld a 2015 jury verdict, in the Northern District of Texas, of over $5,000 in an overtime wage and retaliation suit. The case went like this. A married couple, Santiago Pineda and Maria Pena, lived in an apartment where they would get reduced rent for maintenance work Pineda would do in and around the apartment building. The rent reduction, though, did not account for overtime worked by Pineda. He filed suit against JTCH Apartments for unpaid overtime in the Northern District of Texas. Soon after the suit was filed, Pineda and Pena were put on notice to vacate their apartment for nonpayment of rent (the amount demanded was equal to the total amount of rent reductions). This is when Pena joined the suit and together filed an amended complaint for retaliation.
The Texas District Court ruled in favor of Pineda but Pineda appealed because he felt that the court should have instructed the jury on damages for emotional harm. He claimed that the episode led to marital discord, sleepless nights, and anxiety of where their family would live. The 5th Circuit ruled in favor of Pineda and ultimately ordered a new trial to determine damages in the overtime pay case against the property management firm.
Pena’s retaliation claim, however, failed in the Texas District Court on Defendant’s motion for judgment as a matter of law. The court held that a nonemployee is outside the protection of the FLSA. Pena appealed but the 5th Circuit rejected the claim on the grounds that it was outside the scope of the text of the FLSA. The 5th Circuit, quoting the FLSA said, “it is only unlawful to discharge or…discriminate against an because such employee has filed any complaint.” Pena was also unable to cite any precedent to support her claim.
The 5th Circuit decidedly said that the FLSA “follows the path of tort law,” designed to both provide compensation and deterrence. The ruling is consistent with that notion that damages are designed to both compensate the employee and deter the employer from future violations. Employers should make sure to understand current rulings on FLSA issues in order to fully understand the scope of their obligations and repercussions for violations.
