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Initially, the Court agreed with Propp that his lawyer's letter was protected activity.  It clearly opposed unlawful discrimination.  Also, it mattered not that Propp declined to pursue the discrimination claim since he reasonably believed the employer's action was discriminatory. See Manoharan v. Columbia Univ. Coll. of Physicians & Surgeons, 842 F.2d 590, 593 (2d Cir. 1988).

Next, the Court said Propp must demonstrate that “a reasonable employee would have found the challenged action materially adverse which . . . means it well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Quoting Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 68 (2006). Counterpart argued that the “requirement that Propp sign a release of claims prior to entering into a consulting agreement was not based on any retaliatory motive,” explaining that it “simply wanted Propp to agree not to sue the organization before committing to a continuing relationship with him. This is not retaliation; it is prudence in action.” Counterpart’s brief also argued that the release requirement was always a prerequisite for a consulting position, even prior to Propp’s complaint of discrimination.

Propp did not argue that requiring such a release would be unlawful. What he objected to is being required to sign a release as part of his termination, a new condition precedent to negotiating a consulting agreement imposed after he complained of discrimination.  The court, therefore, did not consider whether releases are generally lawful and enforceable.  In footnote 15, the Court said that requiring a release of the right to file or participate in a discrimination case filed with the EEOC. in exchange for severance pay or some other generally offered benefit has been held to be “facially retaliatory” and unenforceable. Citing EEOC. v. Lockheed Martin Corp., 444 F. Supp. 2d 414, 418-19 (D.Md. 2006) (citing EEOC v. Bd. of Governors of State Colls. & Univs., 952 F.2d 424, 430 (7th Cir. 1992)).

On pages 16-17, the court explains how this case is different than normal situations in which an employer requires a release as part of a settlement agreement:

[O]ne need not question whether obtaining a release was a prudent course for Counterpart under the circumstances. It is enough if retaliation was “a substantial factor,” even if not the only factor. ... Accordingly, it is important to distinguish between requiring a release of claims as part of a negotiated consulting agreement, and imposing a release of claims related to Propp’s termination as a prerequisite for negotiating the consulting agreement that was contemplated when Propp was terminated. Stated otherwise, Propp’s claim is that, once he complained of discrimination, Counterpart refused to negotiate a consulting agreement as it had agreed to do when it terminated him, and effectively withdrew two of the termination options that did not include a release that had been offered before his complaint because he had complained of discrimination.

If proven, Counterpart’s refusal to negotiate with Propp for a consulting position, as it had previously agreed to do, unless Propp signed a release as part of his termination — a requirement imposed only after he complained of discriminatory treatment — would be an adverse action within the contemplation of the DCHRA’s retaliation provision. The Supreme Court has broadly defined what constitutes an “adverse action” to include (in addition to termination, denial of promotion, etc.) actions taken by employers which “a reasonable employee would have found . . . materially adverse, which . . . might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Burlington N., 548 U.S. at 77-78. Therefore, simply because Counterpart may have had a business-related reason (“prudence in action”) for conditioning negotiations for the consulting agreement on a release of claims, it could not require a release of claims in response to Propp’s complaint of discrimination. “The statute contains no safe harbor for otherwise lawful acts done for an improper retaliatory purpose.” Arthur Young, 631 A.2d at 367; see also Atlantic Richfield Co. v. District of Columbia Comm’n on Human Rights, 515 A.2d 1095, 1101 (D.C. 1986) (finding a threat to an employee that “she would never work in the District of Columbia again if she pressed her discrimination claim” to be retaliatory).

It was not necessary that Propp show that he would have received the consulting contract, or that he had any right to the consulting contract.  It was enough that Counterpart created a "Hobson's Choice" in which he would have to either give up his discrimination claim, or give up hope of the consulting contract.  That is enough to discourage others from standing up for their rights.

Judge Ferrell wrote a separate concurring opinion to explain that the case would have been more difficult if Counterpart had admitted that it reassessed its position in response to the letter from Propp's attorney.  It could have argued that the lawyer's letter gave it a valid reason to require that Propp agree to a release as a condition for any consulting contract.  Since Counterpart actually argued that it had required the release even before getting the lawyer's letter, and the evidence provides a basis for a jury to disagree, the Court had to reverse the summary judgment.  The other judges did not join in this concurring opinion.

Overall, the Propp decision is a good example of how the Burlington Northern doctrine should be applied.  Any action that might discourage employees from opposing discrimination should allow the victim to sue, even if it is a new demand for a release of claims.

Congratulations to DC attorney John Racin for representing Brian Propp in this landmark case.

Saint Gobain eventually settled a class-action lawsuit for $1,425,000. However, the district court dismissed Kasten's retaliation claim, holding that FLSA only protects written complaints about violations. The Seventh Circuit U.S. Court of Appeals affirmed, recognizing that its decision was different from that of other courts, and of the U.S. Department of Labor.

The U.S. Supreme Court has now posted its transcript of yesterday's oral argument. Kaster began by telling the Court, "When Kevin Kasten told his employer that the location of the time clocks was illegal and that if they were taken to the court they would lose, he filed any complaint within the meaning of the 215(a)(3) under the Fair Labor Standards Act, because filing includes an oral communication, because "any" means any, which includes formal or informal, written or unwritten communications." He added that, "the act is not to be interpreted in a narrow, grudging fashion." Justice Alito then began a line of questioning to test how minimal a complaint could be and still be protected.  This is disappointing.  The purpose of the law is not served by examining the quanta of employee complaints. It is to prevent the employer's retaliation. If the employer chooses to retaliate against the most minimal complaint -- that would have an even greater deterrent effect than retaliating against formal complaints. The Supreme Court got it right in Burlington Northern & Santa Fe Railway Co. v. White, 548 U.S. 53, 67-68 (2006) when it held that actions that deter other employees from making complaints are sufficiently adverse to be the basis of a retaliation lawsuit.

"Unfortunately, the justices were not focused on what should have been the core concerns, which were well addresses in plaintiff’s and amici’s brief," said attorney Danny Katz of Silver Spring, Maryland, who attended the argument.

The company's lawyer, Carter Phillips, also got tough questions. Justice Ginsburg asked him,  "I thought that the whole idea of this statute is to protect the workers, and I would like you to address particularly the amici's point, that this statute in 1938 affected people -- many were illiterate, they couldn't write a complaint, many were immigrants who weren't familiar with the language, for that universe of people, wouldn't Congress have meant that all complaints are okay?" She persisted, "wouldn't there be every reason to want the employee to complain first to the employer rather than making a Federal case out of it by complaining to a Government agency?" Phillips answered, "Intuitively, I don't disagree with that, Justice Ginsburg, but we have to go, again: What was the purpose of this particular statute?"

Hopefully, the Supreme Court' will be focused on that purpose when they write their decision. Working people need protection from retaliation no matter how they "filed" their complaints. We can expect the Supreme Court's decision in the months ahead. Follow this link to the amicus brief of the National Employment Law Project, the National Employment Lawyers Association, Interfaith Worker Justice, the Southern Poverty Law Center, the United Food and Commercial Workers and other groups. Copies of the other briefs are available here.

Since 1991, Mohammad Baloch has worked for the U.S. Department of Interior as a Water Rights Specialist in the Bureau of Indian Affairs.  Baloch had filed an administrative complaint of employment discrimination.  Thereafter, his managers decided to fill a long-vacant position and they transfered half of Baloch's work to the new co-worker.  Baloch's supervisors also imposed new restrictions on his use of sick leave (although no such leave was actually denied), and his supervisor yelled at him four times in eight months.

The court held that hiring the co-worker was not a materially adverse action.  The Court noted that in the past it has held that diminishing an employee's work responsibilities is an adverse action.  Czekalski v. Peters, 475 F.3d 360, 364 (D.C. Cir. 2007). In this case, however, the quality of Baloch's responsibilities did not go down -- only the amount of work assigned to him. The Court did not want to engage in “judicial micromanagement of business practices” by second-guessing employers’ decisions about “which of several qualified employees will work on a particular assignment.”

The Court also held that since the added sick leave requirements did not result in any denial of sick leave, it was not "material."  Similarly, the Court categorized the yelling as "sporadic" and declined to enforce any workplace civility code.

The Court of Appeals did disagree with the district court's consideration of how Baloch continued to make complaints even after these alleged adverse actions.  The district court concluded that Baloch's continued protected activity showed that the adverse actions did not deter such activity.  This is a frequent defense raised by employers who would obviously prefer that their employees not complain about any illegality they see.  In Baloch's case, footnote 5 on page 12, the Court of Appeals noted that the Supreme Court requires courts to use an objective standard.  Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 68 (2006). Therefore, whether Baloch was or was not deterred in raising his concerns is immaterial to the question of whether the employer's actions would deter other employees from coming forward.  This is an important conclusion that should do away with employer claims based on the whistleblower's courageous continuation of protected activities in the face of alleged retaliation.

The Court also noted that the employer had a legitimate reason for making the new hire.  The co-worker was a lawyer who could handle legal work for the Department and help with the Department's budgeting.  The Court of Appeal said that Baloch did not present evidence tending to show that this reason was a pretext for discrimination.

The full decision is available at:

http://pacer.cadc.uscourts.gov/common/opinions/200812/07-5330-1156088.pdf