Amicus Curiae Brief — Progress Energy Energy, Inc. v. Taylor (No. 07-539)

No. 07-539

IN THE

Supreme Court of the United States

alae ellen alaoioee

PROGRESS ENERGY, INC.,

Petitioner,

v.

BARBARA TAYLOR,

Respondent.

On PETITION FOR A Writ OF CERTIORARI TO THE

UNITED Stares Court OF APPEALS

FOR THE FourTH CIRCUIT

ee

MOTION FOR LEAVE TO FILE BRIEF AND

BRIEF OF AMICUS CURIAE NORTH CAROLINA

RETAIL MERCHANTS ASSOCIATION

IN SUPPORT OF PETITIONER

a ncreermer imine

THOMAS J. WALSH, JR. EDMUND J. MCKENNA

Forp & Harrison LLP Counsel of Record

795 Ridge Lake Blvd. Forp & Harrison LLP

Suite 300 101 East Kennedy Blvd.

Memphis, TN 38120-9475 Suite 900

(901) 291-1500 Tampa, F'L 33602-5133

(813) 261-7800

Attorneys for Amicus Curiae

North Carolina Retail Merchants Association

212542 g

COUNSEL PRESS

(800) 274-3321 » (800) 359-6859

MOTION FOR LEAVE TO FILE BRIEF

OF AMICUS CURIAE

The North Carolina Retail Merchants Association

(NCRMA) moves the Court, pursuant to S. Ct. R. 37.2,

for leave to file a brief as amicus curiae im support of the

petition by Progress Energy, Inc. (Petitioner) for writ

of certiorari to the United States Court of Appeals for

the Fourth Circuit.

As set forth in more detail under Interest of Amicus

Curiae in the attached brief, NCRMA is a non-profit

trade association whose membership includes more than

25,000 retail stores across the State of North Carolina.

Many of its members are covered by the FMLA and have

an immediate and direct interest in the issue before the

Court. Petitioner has consented to the filing of this brief.

Respondent has not returned voice mail messages left

for her counsel on November 16 and 19, 2007, and has

therefore not granted her consent, necessitating this

motion.

NCRMA’s brief will assist the Court in determining

whether to grant certiorari because it will (1) explain

some of the severe practical consequences of the Fourth

Circuit’s approach if left intact; and (2) invite the Court

to revisit its prior FLSA decisions with respect to waiver

of claims, older decisions on which the Fourth Circuit

relied but which the Court should now re-examine in light

of changing relationships between employees and

employers in the contemporary workplace.

Respectfully submitted,

THOMAS J. WALSH, JR. EDMUND J. MCKENNA

Forp & Harrison LLP Counsel of Record

795 Ridge Lake Blvd. Forp & Harrison LLP

Suite 300 101 East Kennedy Blvd.

Memphis, TN 38120-9475 Suite 900

(901) 291-1500 Tampa, F'L 33602-5133

(813) 261-7800

Attorneys for Amicus Curiae

North Carolina Retail Merchants Association

i

TABLE OF CONTENTS

Page

TABLE OF CITED AUTHORITIES ......... li

INTEREST OF AMICUS CURIAE ......... 1

REASONS FOR GRANTING THE PETITION a

Ts) Pe Sain ake Sie se 2

Il. The Court Should Reconsider FLSA

Precedent Regarding Retrospective

WOU cece hecckvcwaudsncdbeconteune 4

III. Other Practical Considerations Also

a 8

CASEY bok dca te eeckegtecete sewers 14

li

TABLE OF CITED AUTHORITIES

Page

Cases:

Air Line Pilots Ass’n, Int’l v. O’Neill, 499 U.S.

I ce a a ans 10

Albertson’s Inc. v. United Food & Comm’!

Workers, Civ. No. 96-0398-S-BLW, 1997 U.S.

Dist. LEXIS 4554 (March 10, 1997), aff'd, 157

F3d 758 (9th Cir. 1998), cert. denied, 528 U.S.

SE oe res eo a ha Oe ews 'g o's 4

Alexander v. Gardner-Denver Co., 415 U.S. 36

I a a er ee te ues wae 7

Auer v. Robbins, 519 U.S. 452 (1997) .......... 3

Barrentine v. Arkansas-Best Freight Sys., Inc.,

ees MS okie vrvddau a eeeeenvekes 4, 5,6

Brooklyn Sav. Bank v. O'Neil, 324 U.S. 697 (1945)

ea ira ee Ba are a Oey pga ie Sake oi an 4, 5,6

Carson v. American Brands, Inc., 450 U.S. 79

RE Fs as nc hues odie a coseeeee es 10

Dougherty v. TEVA Pharms. USA, Inc.,

Civ. Action 05-2336, 2007 U.S. Dist. LEXIS

27200, 12 Wage & Hour Cas. 2d (BNA) 1252

a NES 07'S + a0 0h baececinckoeiss 3

ill

Cited Authorities

Page

Faris v. Williams WPC-I, Inc., 332 F.3d 316

CD: ik kek hud Ace cada es cade ren en 3,10

Gilmer v. Interstate/Johnson Lane Corp.,

gE S| 6 Se ar ree rere 10

Halvorson v. Boy Scouts of Am., No. 99-5021,

2000 U.S. App. LEXIS 9648 (6th Cir. May 3,

eos ha ca Wa ad oie cneneeetewnas 3

Kuehner v. Dickinson & Co., 84 F.3d 316 (9th Cir

MN ka Fs o0 kok eee eae Rei ED keene. 4

Local No. 93, Int’l Ass’n of Firefighters v.

Cleveland, 478 U.S. 501 (1986) ............. 10

Local Union No. 1992 of the Int’l Bhd of Elec.

Workers v. Okonite Co., 189 F.3d 339 (3d Cir.

aie es Saree alia ae Ween cmpeUy ge abe LN rama 9

Long Island Care at Home, Ltd. v. Coke, _ U.S.

pee ek errr ee 3

Mitsubishi Motors Corp. v. Soler Chrysler-

Plymouth, Inc., 473 U.S. 614 (1985) ........ 7,8

O’Connor v. United States, 50 Fed. Cl. 285

(2001), aff'd in part, rev’d in part, 308 F.3d

ST EE, cna dc bod cceos éaebees 4

iv

Cited Authorities

Page

Schoenwald v. ARCO Alaska, Inc., No. 98-35195,

1999 U.S. App. LEXIS 20955 (9th Cir. August

EE hres cee duvins kod aed et ceeiswes e 3

Sneed v. Sneed’s Shipbuilding, Inc., 545 F.2d 537

ARS ie rena ay heen paneer 4

Taylor v. Progress Energy, Inc., 493 F.3d 454

ee te Co awaed 2, 3, 11

Torreblanca v. Nass Foods, Inc., No. F 78-163,

1980 U.S. Dist. LEXIS 13893 (N.D. Ind.

PT SOE 6.0.6 b owid oboev'e dd bn ces se0 4

&

Walker v. Countrywide Credit Ind., Civ. Action

No. 3:03-CV-0684-N, 2004 U.S. Dist. LEXIS

30477 (N.D. Tex. January 15, 2004) ......... 4

Statutes and Regulations:

ce es cw sueemee sen 13

Ry ride POPE GEOR, ccc cs cccccccencevces 2

i ok ns cae uns net evbeees 14

eee petateeceeen 14

bs aun oe wn aan 8

ET ET web ieb vevewcu cok aeueveseteds 8

V

Cited Authorities

Page

A A ld odd a eeh ads oeen Katwes 8

A EE Wivnvdowdessnevseesesbas 2

71 Fed. Reg. 69504 (Dec. 1, 2006) ............. 10

71 Fed. Reg. 69511 (Dec. 1, 2006) ............. 10, 11

Miscellaneous:

Ann Mennell, sth Circuit Rules FMLA Waiver

Invalid Without Court of DOL Approval,

Business and Management Practices (Aug. 16,

DE tie tcarn dain aan nalice Aone FREE Ce LIES 11

Carol Wong, Note: The Family and Medical

Leave Act: To Waive or Not to Waive, 2007 U.

Fike Bi BC TED Sciodvcvcscncvscvcete 10, 11

David E. Nagle, Fourth Circuit: Waiver of

FMLA Rights Requires DOL or Court

Approval, 17 Va. Emp. L. Letter (Aug. 2005)

Liv Utd aced Wats were ned Ob adede bo buades 9

David K. Haase & Emma Sullivan, The Pitfalls

of Releases, Nat’! L. J. Oct. 23, 2006 ........ 9

DOL Bureau of Labor Statistics (http://

www.bls.gov/oco/ocos121.htm) ...........+5. 11

vi

Cited Authorities

Earl M. Jones, III, Jason R. Dugas, and Jennifer

A. Youpa, Annual Survey of Texas Law:

Employment Law, 59 SMU L. Rev. 1211

I DEE © bc poe chavs bdab woes eswson

Jeffrey J. Kros, Courts Spliton FMLA Waivers,

Workspan (Oct. 1, 2005) ....ccccccscesccces

Judy Greenwald, Decision Limiting FMLA

Waivers Creates Employer Headaches,

Business Insurance (Aug. 8, 2005) ..........

Muniza Bawaney, Signed General Releases May

Be Worth Less than Employers Expected:

Circuits Split on Whether Former Employee

Can Sign Release, Reap Its Benefit, and Sue

for FMLA Claim Anyway, 82 Chicago-Kent

LA VI Ge Ct) kc cadccvecesicwerecr

Scott A. Moss, Illuminating Secrecy: A New

Economic Analysis of Confidential

Settlements, 105 Mich. L. Rev. 867 (March

EE isk cide davdcacerinand Veeeneesdawias

Page

12

12

12

1]

Whiteford, Taylor & Preston L.L.P, Zmployers,

Take Note: Your General Release May

Not Be as Brodd as You Think! Maryland

Employment Law Letter (September 2005) ..

12

vil

Cited Authorities

Page

Womble Carlyle Sandridge & Rice, PLLC, Court

Makes It Hard to Settle FMLA Claims, North

. Carolina Employment Law Letter (August

rete bd deuce deeeeeetaceseees 1]

1

INTEREST OF AMICUS CURIAE'

The North Carolina Retail Merchants Association

(NCRMA) is a non-profit trade association organized in

1902 to improve the business climate for retail merchants

in North Carolina. Today, NCRMA serves as the voice

of the retail industry in North Carolina. NCRMA

represents the interests of individual merchants before

the members of the North Carolina General Assembly

and functions as a vital fink to state government. Its

credibility lies in its longevity, and its commitment to

continuing to serve its members’ ever-changing needs.

The NCRMA’s membership includes more than

25,000 stores from across the State of North Carolina,

businesses representing seventy-five percent of North

Carolina’s retail sales volume. NCRMA serves both large

and small retailers from multi-state chains to locally

owned retail outlets, and all types of merchants,

including antique, apparel, art, automotive, book, carpet,

department, drug, electronics, floral, furniture, grocery,

hardware, jewelry, paint and variety stores.

NCRMA is a tax-exempt organization supported

entirely by members’ dues and governed by a forty-four-

member board of directors. Board members represent

1. The Fetitioner has consented to the filing of this brief.

Respondent has not responded to telephone messages requesting

permission to file this brief. Amici has thus moved for the Court’s

permission to file it. No counsel for a party authored this brief

in whole or in part, and no counsel or party made a monetary

contribution intended to fund the preparation or submission of

this brief. No person other than the amicus curiae, or its counsel

made a monetary contribution to its preparation or submission.

2

the wide variety of retailers who do business in

North Carolina. They are also selected to represent

the different geographic areas of the state with

representation in every county in the state.

Many of NCRMA’s members are employers covered

by the Family and Medical Leave Act (“FMLA”) of 1993,

29 U.S.C. §§ 2601 et seq., and by other labor and

employment statutes and regulations. As employers and

representatives of employers who are potential

defendants in FMLA and other employment-related

lawsuits, the amici’s members have a significant interest

in preserving effective, knowing and voluntary means

of resolving both actual and potential claims without the

costs, risks, and other burdens associated with federal

administrative proceedings and litigation. NCRMA’s

members therefore have an immediate and direct

interest in the issue before this Court.

REASONS FOR GRANTING THE PETITION

I. Introduction

In a split decision,? two members of the Fourth

Circuit’s panel below held that under a Department

of Labor (DOL) regulation, 29 C.F.R. § 825.220(d),

employees and employers cannot settle FMLA claims

retrospectively, specifically, that they cannot for

consideration enter into a knowing and voluntary release

of any actual or potential claims of past FMLA violations,

without a court or the DOL intervening.

2. Taylor wu Progress Energy, Inc., 493 F.3d 454 (4th Cir.

2007).

3

This holding relies on older FLSA precedent which

the Court should now revisit.

Further, the Fourth Circuit’s holding directly

conflicts with that of other federal courts’ well-reasoned

decisions.’ Moreover, it rejects the DOLs interpretation

of its own regulation.‘

The existing conflict places employees as well as

employers on the horns of a legal and practical dilemma,

especially in situations where both parties desire an

amicable end to the employment relationship. This Court

needs to resolve this conflict among the federal courts

as well as with the federal agency charged with enforcing

FMLA, and to dispel the unnecessary complexity and

uncertainty that the Fourth Circuit panel has injected

into employer-employee relations.

3. Faris v. Williams WPC-I, Inc., 332 F.3d 316 (5th Cir.

2003); Dougherty v. TEVA Pharms. USA, Inc., Civ. Action 05-

2336, 2007 U.S. Dist. LEXIS 27200, 12 Wage & Hour Cas. 2d

(BNA) 1252 (E.D. April 9, 2007); see also decisions that do not

address the DOL regulation explicitly but reach the result urged

here, e.g., Halvorson v. Boy Scouts of Am., No. 99-5021, 2000

U.S. App. LEXIS 9648 (6th Cir. May 3, 2000); Schoenwald v.

ARCO Alaska, Inc., No. 98-35195, 1999 U.S. App. LEXIS 20955

(9th Cir. August 30, 1999). The dissenting member of the Fourth

Circuit panel below, Judge Duncan, would have followed this

Court’s admonition by deferring to the DOUs interpretation of

its own regulation. Taylor, 493 F.3d at 463-464, citing, inter alia,

Auer v. Robbins, 519 U.S. 452 (1997) and Long Island Care at

Home, Ltd. v. Coke, U.S. _, 127 S. Ct. 2339 (2007).

4. See DOL, C.A. Amicus Brief 1-15.

4

II. The Court Should Reconsider FLSA Precedent

Regarding Retrospective Waiver.

This case offers the Court an opportunity to revisit

two of its Fair Labor Standards Act (FLSA) decisions

which the Fourth Circuit cited and relied upon at 493

F3d 457-460, Brookiyn Sav. Bank v. O’Neil, 324 U.S. 697

(1945) and Barrentine v. Arkansas-Best Freight Sys.,

Inc., 450 U.S. 728 (1981). For reasons discussed

elsewhere, decisions under Title VII and the ADEA

(rulings which acknowledge that retrospective waivers

of employment claims are permitted under those

statutes) present a more apt analogy to FMLA cases

than do # LSA cases. But the Fourth Circuit’s underlying

reliance on FLSA precedent, however misplaced,

presents this issue for this Court’s consideration.’ »

In Brooklyn Sav. Bank this Court held that an

employee’s claim for liquidated damages for past FLSA

violations is a statutory right that parties to a settlement

agreement cannot waive. The Court conceded that

5. Lower federal courts have already declared superseded

or have called into question the ongoing vitality of various aspects

of Brooklyn Sav. Bank and Barrentine. See, e.g., Kuehner v.

Dickinson & Co., 84 F.3d 316, 320 (9th Cir. 1996); Sneed v. Sneed’s

Shipbuilding, Inc., 545 F.2d 537, 539 (5th Cir. 1977); O'Connor »v.

United States, 50 Fed. Cl. 285, 294 (2001), affd in part, rev’d in

part, 308 F.3d 1233 (Fed. Cir. 2002); Walker v. Countrywide Credit

Ind., Civ. Action No. 3:03-CV-0684-N, 2004 U.S. Dist. LEXIS

30477 at * 13-16 (N.D. Tex. January 15, 2004); Albertson’s Inc. v.

United Food & Comm’! Workers, Civ. No. 96-0398-S-BLW, 1997

U.S. Dist. LEXIS 4554 at *27 and *36-38 (March 10, 1997), aff'd,

157 F.3d 758 (9th Cir. 1998), cert. denied, 528 U.S. 809 (1999);

Torreblanca v. Nass Foods, Inc., No. F 78-163, 1980 U.S. Dist.

LEXIS 13893 at *7 (N.D. Ind. February 25, 1980).

5

“(nJeither the statutory language, the legislative reports

nor the debates indicates that the question at issue was

specifically considered and resolved by Congress.”

Id., 324 U.S. at 705-706. From that legislative silence,

however, the Court drew the lesson that “[ijJn the absence

of evidence of specific Congressional intent, it becomes

necessary to resort to a broader consideration of the

legislative policy behind this provision as evidenced by

its legislative history and the provisions in and structure

of the Act.” Jd. at 706. The Court concluded, “Such

consideration clearly shows that Congress did not intend

that an employee should be allowed to waive his right to

liquidated damages.” /d. .

The dissenting Justices in Brooklyn Sav. Bank

bluntly disagreed: “We find nothing in the Fair Labor

Standards Act to prevent the effective operation of such

a release upon the cause of action for liquidated damages

more than any other.” Jd., 324 U.S. at 716.

In Barrentine the Court also considered the

relationship between statutory rights and private

parties’ contracting rights in the FLSA context.

Specifically, the majority held in Barrentine that

employees’ FLSA action for unpaid time was not barred

by the prior, unsuccessful submission of their wage claim

to a joint employer-union grievance committee. The

Court reasoned that the FLSA rights in question were

independent of the collective bargaining process insofar

as they devolved upon the employees as individual

workers rather than as members of a collective

organization.

6

Once again the majority’s view drew vigorous

dissent. The two dissenting Justices in Barrentine, Chief

Justice Burger and then-Associate Justice Rehnquist,

noted that the wage dispute in question fell well within

the scope of countless work contracts around the country.

Barrentine, 450 U.S. at 746-752. The dissenters observed

that the majority’s holding amounted to “ignoring the

objective of Congress, the agreement of the parties, and

the common sense of the situation.” Jd. at 746. They

noted that the majority’s decision “moves toward making

federal courts small claims courts contrary to the

constitutional concept of these courts having special and

limited jurisdiction.” /d.

The reasoning of the dissenting Justices in Brooklyn

Sav. Bank and Barrentine holds even truer in the

context of today’s workplace realities. In times past,

relationships between employers and empioyees tended

to be characterized by starkly unequal bargaining power.

This fact of life propelled the courts to reach out as the

sole or primary protectors of employees’ rights, and to

create rules in the absence of Congressional action.

Today, by contrast, a great many federal statutes

extend rights to employees, and (as in this case) those

statutes typically invest federal administrative agencies

with investigatory and enforcement authority, in addition

to the power to promulgate regulations. Moreover,

employees today tend to be more attuned to their legal

rights, and these same employment statutes usually give

employees access to agencies as well as courts for

redress of grievances. Generally aware of such rights

and mechanisms, employees often take advantage of

their right to consult legal counsel before signing

7

settlement agreements, releases, or any other contracts

affecting their rights.

Given these realities of the modern workplace, an

employee should be able, without agency or court

supervision, to waive claims retrospectively — whether

claims under Title VII, FLSA, ADEA, or FMLA —

absent an express Congressional ban on waiver, as long

as the waiver is knowing and voluntary. Especially should

this be true where the employee is represented by

counsel. ‘

The Court performed a similar analysis in an

analogous setting, the question of whether parties could

use a mutually-agreed-upon private resolution

mechanism (in that instance, arbitration) to resolve

employees’ claims of statutory violations. InAlexander

v. Gardner-Denver Co., 415 U.S. 36 (1974), the Court

unanimously held that Article III judges and

representative juries were uniquely suited to, and

protective of, workers’ statutory civil rights. The Court

held that the arbitral process—less formal, with limited

discovery, and focused on contractual rights rather than

public rights—was not suited for that purpose. But a

decade later, in Mitsubishi Motors Corp. v. Soler

Chrysler-Plymouth, Inc., 473 U.S. 614 (1985) the Court

had come to the view that the arbitral forum was

presumptively competent to resolve certain statutory

claims of this nature, as long as there had been a valid

agreement to arbitrate and the statute did not preclude

arbitration.

In its later opinion the Court recognized that the

law must respond to changing times and circumstances,

noting that “we are well past the time when judicial

8

suspicion of the desirability of arbitration and the

competence of arbitral tribunals inhibited the

development of arbitration as an alternative means of

dispute resolution.” Mitsubishi, 473 U.S. at 626-627.

Similarly, the Court should take into accourt

changing circumstances since its earlier rulings with

respect to private resolution of pre-existing FLSA

claims. If in this modern era competent parties wish to

agree to resolve their actual or potential differences for

the exchange of valuable consideration, absent a

legislative or constitutional ban they should be allowed —

to do so.

Additional practical considerations, discussed below,

reinforce these conclusions.

III. Other Practical Considerations Also Dictate

Review.

As all agree, in enacting the FMLA, Congress was

silent on the point at issue here. It left such matters to

the discretion of the DOL, the agency to which Congress

granted investigatory and enforcement authority,

29 U.S.C. §§ 2616, 2617, and which Congress empowered

to promulgate regulations necessary to carry out the Act.

29 U.S.C. § 2654. Essentially ignoring both Congress

and the DOL, in its ruling below the Fourth Circuit has

engrafted its own rules onto the statute. The Fourth

Circuit’s unwarranted foray into agency rulemaking, if

left intact, would give rise to many serious practical

problems.

9

Literally tens of thousands of employers routinely

provide terminated employees with severance

agreements, especially for employees whose positions

have been eliminated through reductions in force, of

which there have been large numbers in recent years.®

Such severance agreements typically include cash

consideration for the employee, along with other

benefits, in exchange for which the employee agrees to

release any actual or potential claims against the

employer.’ Indeed, the release at issue in this case

contains these common elements.

A signal advantage of such agreements for

employers, as well as for departing employees, is that

they provide security. Employees receive the security

of compensation and benefits to which they would not

otherwise be entitled. This support helps individuals in

those situations bridge the gap from one job to the next.

In turn it often relieves, at least partly, the public sector

from having to expend taxpayer money for this purpose.

For their part, employers receive the security of

diminished prospects for future litigation, and a

concomitantly greater ability to formulate reliable

business plans and budgets. In short, for employer and

6. Local Union No. 1992 of the Int Bhd of Elec. Workers u

Okonite Co., 189 F.3d 339, 348 (3d Cir. 1999) (Rosenn, J.,

dissenting); Scott A. Moss, Illuminating Secrecy: A New

Economic Analysis of Confidential Settlements, 105 Mich. L.-

Rev. 867, 883 (March 2007).

7. David E. Nagle, Fourth Circuit: Waiver of FMLA Rights

Requires DOL or Court Approval, 17 Va. Emp. L. Letter (Aug.

2005); David K. Haase & Emma Sullivan, The Pitfalls of Releases,

Nat’ L. J. Oct. 23, 2006, at 16.

‘s

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10

employee alike, it creates a clean break and a chance for

afresh start’

These agreements also comport with oft-emphasized

federal policy favoring the settlement of existing workplace

disputes. See, e.g., Air Line Pilots Ass’n, Intl v. O'Neill,

499 U.S. 65, 78 (1991); Carson v. American Brands, Inc.,

450 U.S. 79, 87 (1981) (noting that such agreements can

help “avoid the costs and uncertainties of litigation”).

Indeed, federal courts have themselves instituted programs

for mediation or arbitration of matters in controversy

before them. Even at the appellate stage, federal circuit

courts of appeals have codified in their rules various formal

procedures which encourage the amicable resolution of

matters on appeal. If it is desirable privately to settle a

controversy at the appellate stage, after the parties and

courts have devoted substantial resources to its resolution,

it follows that a much more desirable outcome would be to

permit the parties themselves to reach an amicable and

mutually satisfactory agreement at an early stage, before

these additional expenses are incurred.

Similarly, public policy favors enforcement of waivers

in the context of analogous employment claims. Faris, 332

F3d at 321; see also Gilmer v. Interstate/Johnson Lane

Corp., 500 U.S. 20, 26-29 (1991); Local No. 93, Intl Ass’n of

Firefighters v. Cleveland, 478 U.S. 501, 515-516 (1986);

Carson, supra.

By contrast, the Fourth Circuit panel’s approach

discourages the private settlement of claims. An estimated

seventy-six million American employees enjoy FMLA

protection. 71 Fed. Reg. 69504, 69511 (Dec. 1, 2006). In 2005,

8. Carol Wong, Note: The Family and Medical Leave Act:

To Waive or Not to Waive, 2007 U. Ill. L. Rev. 1567, 1579-80 (2007).

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as many as thirteen million workers took leave for reasons

covered by the FMLA. 71 Fed. Reg. 69511. If employers

could not know for sure that they could achieve closure

and avoid the trouble and expense of future FMLA

litigation by entering into a settlement and release with a

departing employee, they would be far less likely to offer

the employee much if any consideration in return for the

employee executing a release. Laid-off employees would

thereby lose a significant benefit they now often enjoy. °

Retail merchants, such as those represented by the

North Carolina Retail Merchants Association, suffer from

high turnover. DOL Bureau of Labor Statistics (ttp://

www.bls.gov/oco/ocos121.htm). Faced with such a situation,

retail employers need a simple, inexpensive way to resolve

issues with employees. The Fourth Circuit’s decision fails

to take these and other practical needs into account.’°

9. See, e.g., Carol Wong, supra, 2007 U. Ill. L. Rev. at 1579-

80; Womble Carlyle Sandridge & Rice, PLLC, Court Makes It

Hard to Settle FMLA Claims, North Carolina Employment Law

Letter (August 2005) (noting that the 4th Circuit’s Taylor

decision will make employers less willing to pay severance to

laid-off employees); Ann Mennell, 4th Circuit Rules FMLA

Waiver Invalid Without Court of DOL Approval, Business and

Management Practices (Aug. 16, 2005) (“This case is troubling

in that it undermines the finality that an employer expects to

receive in exchange for a severance payment.” The author

suggests employers may wish to offer less in severance pay due

to this uncertainty.)

10. See, e.g., Muniza Bawaney, Signed General Releases

May Be Worth Less than Employers Expected: Circuits Split

on Whether Former Employee Can Sign Release, Reap Its

Benefit, and Sue for FMLA Claim Anyway, 82 Chicago-Kent

Law Review 525 (2007) (endorsing the 5th Circuit’s holding in

(Cont'd)

12

Beyond these problems, the Fourth Circuit’s

approach calls into question the validity of countless

settlement agreements and releases to which employers

and employees have agreed in the past, injecting further

uncertainty into individual lives and into the commercial

life of the nation.

In addition to the practical obstacles the Fourth

Circuit’s rule would create for employees and employers,

the approval scheme which the Fourth Circuit

envisions—one which, as stated, the court below created

with no specific statutory basis, and over the opposition

of the agency itself—would unduly burden the already

over-burdened federal courts as well as the DOL.

(Cont’d)

Faris and concluding that the 4th Circuit’s Panel approach is

“inconsistent,” “troubling,” “impractical,” and “inefficient”); Earl

M. Jones, III, Jason R. Dugas, and Jennifer A. Youpa, Annual

Survey of Texas Law: Employment Law, 59 SMU L. Rev. 1211

(Summer 2006) (4th Circuit Panel’s “startling” decision “takes

away employers’ security of knowing that a settlement is final

and binding.”); Jeffrey J. Kros, Courts Split on FMLA Waivers,

Workspan (Oct. 1, 2005) (4th Circuit’s “surprising” decision in

conflict with other authorities “leaves many HR practitioners

caught in the middle, wondering which way to go.”); Whiteford,

Taylor & Preston L.L.P, Employers, Take Note: Your General

Release May Not Be as Broad as You Think! Maryland

Employment Law Letter (September 2005) (4th Circuit has

“thrown a monkey wrench” into the common prattice of providing

enhanced severance benefits to departing employees in exchange

for a general waiver and release of claims); Judy Greenwald,

Decision Limiting FMLA Waivers Creates Employer

Headaches, Business Insurance (Aug. 8, 2005) (citing authorities

that 4th Circuit decision creates a “land mine” for both employers

and employees).

13

Potentially, many \«ousands of individual employers and

individual employees, few having any justiciable

controversy, would have to submit their private

agreements to the DOL or the courts each year. Most if

not all such cases would presumably require some level

of detailed inquiry. Neither the agency nor the courts

possess the necessary resources for dealing with such

an onslaught of new matters, essentially creating

controversies where none exist, without sacrificing other

important aspects of their work.

Finally, rejection of the Fourth Circuit's rule would

not leave employees without legal protection. An

employee who waives his or her rights under inequitable

circumstances still has a judicial remedy. Any waiver

must be knowing and voluntary in order to be

enforceable. In any situation where an employer uses

unequal bargaining power to apply undue pressure on

an employee to sign an agreement against his or her will

or without adequate information, courts can and will step

in. This safety net for employees also serves as a

prophylactic check on any abuses by employers. But in

the vast majority of cases, where employers and

employees properly agree to an amicable parting, they

should be allowed to do so undisturbed.

11. Employees who qualify for coverage under the Older

Workers Benefit Protection Act (QWBPA)—millions of workers

who are at least 40 years old—receive the added protection of

that statute’s requirement that any waiver under the ADEA be

knowing and voluntary. The OWBPA sets eight minimum

requirements for a release to mect this standard. 29 U.S.C.

§ 626(f)(1)

14

CONCLUSION

Congress enacted the FMLA in part to balance

workplace demands and family needs “in a manner that

accommodates the legitimate interests of employers.”

29 U.S.C. § 2601(b)(1), (3). The Fourth Circuit’s rule

defeats those purposes. This Court should grant the

petition to address this issue, as well as to address the

issue of the continuing vitality of prior decisions relating

to waiver in the FLSA context.

Respectfully submitted,

THOMAS J. WALSH, JR. EDMUND J. McKENNA

Forp & Harrison LLP Counsel of Record

795 Ridge Lake Blvd. Forp & Harrison LLP

Suite 300 3 101 East Kennedy Blvd.

Memphis, TN 38120-9475 Suite 900

(901) 291-1500 Tampa, F'L 33602-5133

(813) 261-7800

Attorneys for Amicus Curiae

North Carolina Retail Merchants Association