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Michael Phelan
Michael Phelan
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Butler Williams Wins Important Unpaid Overtime Decision

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We are pleased to report that, today, our law firm received a favorable Fourth Circuit Court ruling for a client establishing a claim for a company’s retaliation against former employees who claim unpaid overtime compensation. The controlling law which requires the payment of overtime for all hours worked over 40 per week, the Fair Labor Standards Act (FLSA), contains separate retaliation protection to “employees” who claim unpaid overtime or minimum wages. This case for our client, Darveau v. Detecon, Incorporated, No. 06-2092 (January 31, 2008), is the first time that the United States Court of Appeals for the Fourth Circuit (covering federal trial courts in Virginia, North Carolina, South Carolina, Maryland and West Virginia) has considered the issue of whether former employees are likewise protected under the overtime law.

Just fifteen days after Mr. Darveau filed suit in federal court for unpaid overtime wages under the FLSA, the company filed another lawsuit in Virginia state court for purported fraud and fraudulent concealment against Mr. Darveau. The company later changed the claims to assert constructive fraud and breach of contract. The court dismissed all of the company’s claims against Mr. Darveau. Mr. Darveau alleged that his former employer’s state court lawsuit had no merit and was filed in retaliation for his own claim for unpaid overtime wages. The trial court initially decided that Mr. Darveau could not make a retaliation claim for the company’s lawsuit against him following his claim for unpaid wages because he was not a present employee. This appellate court decision reverses the trial court decision and returns the retaliation case to the federal court in Alexandria, Virginia, where it will be tried.

Most federal discrimination laws, including Title VII (protection against sex, race, color, national origin, religious discrimination), Age Discrimination in Employment Act (ADEA/ age discrimination), Family and Medical Leave Act (FMLA/ medical and family leave) and Americans with Disabilities Act (ADA/disability) contain separate retaliation protection for those who oppose illegal employment practices or participate in administrative or legal proceedings by making claims or serving as witnesses. The law protects the employee or witness whether the underlying claim is successful or not. In fact, Mr. Darveau did not prevail on his overtime case due to the Court’s ruling that he was an exempt administrative employee. However, he could not be retaliated against by a retaliatory lawsuit filed by his former employer. With this decision, the Fourth Circuit sends a strong message that retaliation by employers against employees, including those former employees claiming their entitlement to unpaid overtime, will not be permitted. Former employees continue to have the courts’ and the laws’ protection against retaliation – even after the employment has ended.

Harris D. Butler, III
Butler Williams & Skilling