FLSA ‘Manager Rule' Doesn't Apply to Title VII Cases

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By Jay-Anne Casuga

Aug. 10 — A former employee assistance program consultant for a Virginia nonprofit health-care organization who alleged he was fired because he assisted a male worker with internal sexual harassment and retaliation complaints and criticized the company's handling of a resulting investigation stated a plausible retaliation claim under Title VII of the 1964 Civil Rights Act, the U.S. Court of Appeals for the Fourth Circuit ruled Aug. 10.

Reversing and remanding the dismissal of J. Neil DeMasters's complaint against Carilion Clinic and related entities, the Fourth Circuit rejected the U.S. District Court for the Western District of Virginia's conclusion that a so-called manager rule prevented DeMasters, whose job duties included reporting bias claims, from seeking protection under Title VII's opposition clause, which prohibits employers from retaliating against workers who oppose unlawful practices.

The court explained that the “manager rule” has been applied by the First, Fifth and Tenth circuits in the context of Fair Labor Standards Act retaliation claims to require an employee to “‘step outside his or her role of representing the company' in order to engage in” activity protected by the FLSA.

Congressional Intent Examined

Joining the Sixth Circuit, the Fourth Circuit held that the FLSA “manager rule” doesn't apply to Title VII. Nothing in the text of Title VII, which covers a broader range of activity than the FLSA, indicates that its provisions rely on an employee's job description or that “Congress intended to excise a large category of workers from its anti-retaliation protections,” it said.

The court said its conclusion is supported by U.S. Supreme Court precedent that cautions against restricting the scope of Title VII. Applying the “manager rule” potentially could discourage employees from complaining about workplace discrimination, it added.

In addition, the Fourth Circuit ruled that the lower court erred by examining each of DeMasters's communications with the allegedly harassed worker and Carilion officials as individual acts that separately didn't constitute Title VII protected activity.

The court said DeMasters's conversations and complaints should have been viewed as a “continuous course of oppositional conduct,” given that nothing in the text, purpose or interpretations of Title VII “supports a myopic analysis under which an employee’s opposition must be evaluated as a series of discrete acts.”

Furthermore, the appeals court said DeMasters plausibly alleged in his complaint that he “clearly and effectively conveyed to Carilion over several weeks his belief that Carilion was violating Title VII by subjecting [the male employee] to unlawful conduct” and that a causal link exists between that protected activity and his eventual termination.

Terry N. Grimes of Roanoke, Va., represented DeMasters. Woods Rogers represented Carilion.

To contact the reporter on this story: Jay-Anne Casuga in Washington at jcasuga@bna.com.

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com.

Text of the opinion is available at http://www.bloomberglaw.com/public/document/J_NEIL_DEMASTERS_Plaintiff_Appellant_v_CARILION_CLINIC_CARILION_M.