Fifth Circuit Rules Retaliation Provision of the Fair Labor Standards Act Permits Recovery for Emotional Distress Damages

A Texas man struck gold last week with the Fifth Circuit’s decision that the Fair
Labor Standards Act (the “FLSA”) allows retaliation victims to recover emotional
distress damages.

fifth-circuit-court-rules-retaliation-provision-permits-recovery-for-emotional-distress-damagesSantiago Pineda and Maria Pena, a married couple, leased an apartment owned by
JTCH Apartments, LLC (“JTCH”). Pineda performed maintenance work in and around
the apartment complex for JTCH in return for compensation and discounted rent. Pineda
initially filed suit against JTCH and its owner and manager, Simona Vizireanu, for unpaid
overtime under the FLSA. However, three days after Pineda served JTCH with the
summons, he and his wife received a notice to vacate their apartment for nonpayment of
rent. The amount JTCH demanded equaled the rent reductions that Pena had received
over the period of Pineda’s employment. Having been evicted, Pena then joined Pineda’s
suit and they amended the complaint to include retaliation claims based on the back rent
demanded after the filing of the lawsuit.

At trial, the Defendants successfully moved for a judgment as a matter of law on
Pena’s claim, arguing that non-employee spouses are outside the protection of the FLSA.
Pineda was successful on both his overtime wage claim and his retaliation claim, but U.S.
District Judge Jane J. Boyle rejected his bid to have the jury hear an instruction on
emotional distress damages for his retaliation claim. Judge Boyle cited an earlier
appellate decision that found the remedies provisions of the FLSA and the Age
Discrimination in Employment Act should be interpreted consistently, and used that
premise to conclude that emotional damages were not available under the FLSA.

On appeal, the Fifth Circuit overruled that determination and found that, unlike
the ADEA, the FLSA does not require exhaustion of remedies before an agency. Instead,
the appellate court observed that, it follows the path of tort law by allowing immediate
suits for compensation and deterrence. “We have never said that this freestanding
language in the ADEA automatically applies to the FLSA, and that would make little
sense,” the court wrote. “Although the ADEA incorporates portions of the FLSA, the
FLSA does not incorporate the ADEA.” The court concluded that emotional damages are
“such legal or equitable relief as may be appropriate” for an employee that has suffered
emotional damages as a result of employer retaliation. Unfortunately for Pena, the Fifth
Circuit upheld the district court’s decision that non-employee spouses are outside of the
protection of the FLSA.