Recent Fourth Circuit Labor and Employment Decisions

The Fourth Circuit has published opinions in three labor and employment cases in recent weeks.  The first case, Sepulveda v. Allen Family Foods, Inc., concerned a Fair Labor Standards Act (FLSA) collective action that was brought on behalf of a class of current and former employees of a chicken processing plant.  The employees claimed, among other things, that the company had violated the FLSA by not compensating them for time spent donning and doffing their protective gear before and after their shifts.  There is a specific exception in FLSA for cases regarding compensable time for “changing clothes” when the employees are represented by a union that has negotiated a collective bargaining unit.  The Court held that putting on and taking off protecting gear was “changing clothes,” so the exception applied because these plaintiffs had a union, and so judgment was rightly granted to the employer.

In the second case, Stone v. Instrumentation Labratory Company, the Court clarified how employees may pursue retaliation claims under the Sarbanes-Oxley Act.  The Sarbanes-Oxley Act provides employees of publicly traded companies with whistleblower protection, prohibiting employers from terminating, or otherwise retaliating against, such employees when they report “potentially unlawful conduct” that has occurred or is in progress.  The unlawful conduct is often securities fraud or other types of fraud, including making misrepresentations to shareholders.  To pursue a retaliation claim, a plaintiff must first file a complaint with the Department of Labor (which is handled by its OSHA office), and if no final decision is issued in 180 days, the plaintiff may file an action in federal district court.  The Court reaffirmed this procedure, and held that the district court improperly failed to hear a properly filed retaliation action.

In the third case, Alton H. Piester, LLC v. NLRB, the Court upheld the NLRB’s determination that the employer had committed unfair labor practices by (1) impliedly threatening to discharge its employees if they continued to engage in protected, concerted activity — objecting as a group to a change in pay policies — and (2) by impliedly threatening to discharge and then actually discharging an employee for continuing to engage in similar protected, concerted activity.  The majority of the Court concluded that the Board’s decision on both unfair labor practices was supported by substantial evidence.