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CEO's Indirect Statements Can Give Rise to Retaliation Lawsuit

The First Circuit Court of Appeals issued a decision last week allowing a retaliation lawsuit to proceed because the company's CEO told others that he wanted to "get rid of" an employee, even though there was no evidence that the CEO made those statements directly to the supervisor who terminated the employee, or that the CEO was in any way involved in the termination decision.

In Travers v. Flight Services & Systems, Inc., No. 13-1438 (1st Cir. 2013), the plaintiff-employee was the lead plaintiff in a class action lawsuit against his employer for failure to pay the minimum wage, among other claims.  After this class action lawsuit was filed, the company's CEO repeatedly told the employee's supervisor and other employees that he wanted to "get rid of" the plaintiff employee and "talk [the employee] into dropping the lawsuit."  About a year later, a different supervisor, who was not present when the CEO made those statements, fired the employee following a written customer complaint.  In response, the employee filed a second lawsuit against the company, this time for retaliatory termination. 

The trial court granted summary judgment in favor of the company on the employee's retaliation claim.  Among other reasons, the trial court noted that there was no evidence that the CEO played any role in the termination decision, or that the supervisor responsible for the termination was aware of the CEO's views about the employee.  The employee appealed the trial court's judgment, and the First Circuit Court of Appeals overturned it.

The First Circuit wrote that while a lack of evidence providing a direct link between the CEO's "retaliatory animus" and the decision to fire the employee would ordinarily be fatal to the employee's claim, in this case, the lawsuit should be allowed to proceed because "the retaliatory animus resided at the apex of the organization hierarchy."  As the First Circuit eloquently put it, "such strongly held and repeatedly voiced wishes of the king, so to speak, likely became well known to those courtiers who might rid him of a bothersome underling."  In other words, CEOs and anyone else in upper management should be careful when "voicing wishes" concerning terminations and other personnel decisions, because those "wishes" may be considered by courts to be official directives to employees.

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