The U.S. Court of Appeals for the Seventh Circuit recently denied an employer’s  motion for summary judgment in a closely watched FLSA retaliation case based on circumstantial evidence of a causal nexus between protected activity and an adverse employment action.  Kasten v. Saint-Gobain Performance Plastics Corp., No. 12-cv-1671, 2012 U.S. App. LEXIS 24624 (7th Cir. Nov. 30, 2012).  The court focused closely on:  (i) suspicious timing; (ii) allegedly “ambiguous” statements and behavior; and (iii) purported evidence of pretextual reasons for the adverse employment action.  Though this case arises in the FLSA context, it sheds light on the approach the Seventh Circuit other courts can be expected to take in a variety of employment retaliation cases.

Background Facts & Procedural History

Defendant-Appellee Saint-Gobain Performance Plastics Corporation (the “Company”) employed Plaintiff-Appellant Kevin Kasten as an hourly manufacturing and production employee.  The Company discharged Mr. Kasten after he lodged oral complaints concerning the location of time clocks at a production facility.  Mr. Kasten received several warnings about his failures to punch-in and punch-out, and two suspensions.  The Company discharged Mr. Kasten shortly after he complained, and he proceeded to file suit in the U.S. District Court for the Northern District of Illinois, alleging a violation of the FLSA anti-retaliation provision (29 U.S.C. § 215(a)(3)). 

The district court originally granted the Company summary judgment, concluding that oral complaints do not constitute protected activity under the FLSA, and the Seventh Circuit affirmed.  But the U.S. Supreme Court vacated and remanded, ruling that oral complaints can qualify as protected activity if they provide fair notice that an employee is asserting his or her rights under the FLSA.  On remand, the district court found Mr. Kasten’s oral complaints provided such fair notice, but that summary judgment in the Company’s favor still was warranted on causation grounds.

The Seventh Circuit’s Ruling

The Seventh Circuit reversed, finding that Mr. Kasten raised a jury question with respect to fact issues bearing on causation, stressing that circumstantial evidence in this context (specifically, under the direct method of proof) can include suspicious timing, ambiguous statements or behaviors, evidence that similarly situated employees were treated differently, and a pretextual reason for an adverse action.  The Seventh Circuit found that much of this indicia existed in this case in light of the following assertions Mr. Kasten made.  Specifically:

  1. Suspicious Timing:  The decision to discharge Mr. Kasten allegedly was made hours after operations and plant managers learned that he asked his shift supervisor about class action lawsuits regarding time-clock punches. 
  2. Ambiguous Statements:  Mr. Kasten asserted that his supervisor told him to “Just lay down and tell them what they want to hear, [they] can probably save your job.”  
  3. Suspicious Behavior:  The Company allegedly moved the time-clocks the day Mr. Kasten was discharged. 
  4. Pretext:  The court relied on Mr. Kasten’s assertion that the Company’s reasons for his discharge had shifted.

Implications

The Kasten case has received substantial attention because it led to a Supreme Court ruling on what qualifies as protected activity under the FLSA; oral complaints now qualify as protected activity under the FLSA’s anti-retaliation provision.  The Seventh Circuit’s most recent decision in this case with respect to issues of causation is instructive as well.  Indeed, employment retaliation cases are routinely filed under myriad statutes governing the employment relationship and the principles articulated in this case shed light on the framework the Seventh Circuit and other courts generally apply.  However, it is important to note that a range of anti-retaliation statutes – such as AIR 21, the Energy Reorganization Act, the STAA, and Section 806 of SOX – have unique burden-shifting standards that differ in material respects from the framework applied in Kasten.

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Photo of Rachel Fischer Rachel Fischer

Rachel S. Fischer is a senior counsel in the Labor & Employment Law Department.

Rachel represents employers in all types of employment-related disputes, including defending clients against claims of discrimination, harassment, retaliation, wrongful discharge, whistleblowing, breach of contract, and in wage and hour…

Rachel S. Fischer is a senior counsel in the Labor & Employment Law Department.

Rachel represents employers in all types of employment-related disputes, including defending clients against claims of discrimination, harassment, retaliation, wrongful discharge, whistleblowing, breach of contract, and in wage and hour matters. She represents employers in federal and state courts, arbitration tribunals, and before administrative agencies, and has litigated both single plaintiff and class action lawsuits. As an experienced trial lawyer, Rachel has successfully litigated numerous cases from complaint through jury verdict or arbitral award.

Rachel represents employers across a wide variety of industries, including banking and finance, law firms, media and entertainment, sports, and higher education.

Rachel also counsels clients on a broad range of employment law matters, including investigations, employee terminations and discipline, and employment policies and procedures.

Photo of Steven J. Pearlman Steven J. Pearlman

Steven J. Pearlman is a partner in the Labor & Employment Law Department, where he is Head of the Restrictive Covenants, Trade Secrets & Unfair Competition Group and Co-Head of the Whistleblowing & Retaliation Group.

Employment, Whistleblower, Restrictive Covenant and Trade Secret Practice.

Steven J. Pearlman is a partner in the Labor & Employment Law Department, where he is Head of the Restrictive Covenants, Trade Secrets & Unfair Competition Group and Co-Head of the Whistleblowing & Retaliation Group.

Employment, Whistleblower, Restrictive Covenant and Trade Secret Practice. Steven’s national practice focuses on defending companies in federal and state courts and arbitration against claims of: discrimination, retaliation and harassment, including claims brought by high-level executives; whistleblower retaliation; restrictive covenant violations; theft of trade secrets; and wage-and-hour violations (including class, collective and PAGA actions).

Illustrating his versatility, Steven has successfully handled bench and jury trials in multiple jurisdictions (e.g., Illinois, California, Florida and Texas); defended one of the largest Illinois-only class actions in the history of the federal courts in Chicago; and prevailed following his oral arguments before the Seventh Circuit and state appellate courts. Steven brings his litigation experience to bear in counseling clients to minimize risk and avoid or prepare for success in litigation.

Investigations. Reporting to boards of directors, their audit committees, CEOs and in-house counsel, Steven conducts sensitive investigations and has testified in federal court. His investigations have involved complaints of sexual harassment involving C-suite officers; systemic violations of employment laws and company policies; and fraud, compliance failures and unethical conduct.

Thought Leadership and Accolades. Steven was named Lawyer of the Year for Chicago Labor & Employment Litigation in the 2023 edition of The Best Lawyers in America. He was also named as One of the Top 10 Impactful Labor & Employment Lawyers in Illinois for 2023 by Business Today. He is a Fellow of the College of Labor and Employment Lawyers. Chambers describes Steven as an “outstanding lawyer” who is “very sharp and very responsive,” a “strong advocate,” and an “expert in his field.” Chambers also reports that “He is someone who can navigate the twists and turns of litigation without difficulty. Steven is great with brief-writing, crafting arguments, and making sure the client is always happy.”

Steven was 1 of 12 individuals selected by Compliance Week as a “Top Mind.” Earlier in his career, he was 1 of 5 U.S. lawyers selected by Law360 as a “Rising Star Under 40” in the area of employment law and 1 of “40 Illinois Attorneys Under Forty to Watch” selected by Law Bulletin Publishing Company. Steven is a Burton Award Winner (U.S. Library of Congress) for “Distinguished Legal Writing.”

Steven was appointed to Law360’s Employment Editorial Advisory Board and selected as a Contributor to Forbes.com. He has appeared on Bloomberg News (television and radio) and Yahoo! Finance, and is often quoted in leading publications such as The Wall Street Journal.

The U.S. Chamber of Commerce has engaged Steven to serve as lead counsel on amicus briefs to the U.S. Supreme Court and federal circuit courts of appeal. He was appointed to serve as a Special Assistant Attorney General for the State of Illinois in employment litigation matters. He has presented with the Solicitor of the DOL, the Acting Chair of the EEOC, an EEOC Commissioner, Legal Counsel to the EEOC, and heads of the SEC, CFTC and OSHA whistleblower programs. He is also a member of the Sedona Conference, focusing on trade secret matters.

In 2024, Steven received the Excellence in Pro Bono Service Award from the United States District Court for the Northern District of Illinois and the Chicago Chapter of the Federal Bar Association.