Lumry v. State

• Decision Date: 16 December 2016
• Docket Number: No. 108,425,108,425
• Citation: 385 P.3d 479
• Parties: Keith LUMRY, Appellant, v. STATE of Kansas, Kansas Bureau of Investigation, Clint Hawkins, Kelly Ralston, and Robert Blecha, Appellees.
• Court: Kansas Supreme Court

385 P.3d 479

Keith LUMRY, Appellant,

v.STATE of Kansas, Kansas Bureau of Investigation, Clint Hawkins, Kelly Ralston, and Robert Blecha, Appellees.

No. 108,425

Supreme Court of Kansas.

Opinion filed December 16, 2016

Alan V. Johnson, of Sloan, Eisenbarth, Glassman, McEntire & Jarboe, L.L.C., of Topeka, argued the cause and was on the briefs for appellant.

David R. Cooper, of Fisher, Patterson, Sayler & Smith, L.L.P., of Topeka, argued the cause, and Teresa L. Watson, of the same firm, was with him on the briefs for appellees.

Per Curiam:

To comply with wage and hour law, the Kansas Bureau of Investigation's official overtime policy requires monetary compensation at one-and-a-half times the normal hourly rate for hours worked in excess of 80 hours in a two-week period, or one-and-a-half hours of compensatory time for every overtime hour. But Keith Lumry, a former KBI agent, alleges the bureau illegally pressured personnel to work overtime without claiming it, i.e ., off the clock and without pay. He claims he was fired in retaliation for complaining about this. The district court granted defendants summary judgment. A divided Court of Appeals affirmed, although the majority's reasoning differed from the district court's. One panel member dissented, in part, and would have remanded some of the claims for trial. Lumry v. State , 49 Kan.App.2d 276, 307 P.3d 232 (2013). Both sides seek our review.

The parties ask: (1) Whether KBI Director Robert Blecha is an "employer" who can be individually liable for retaliation under the federal Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq . (2012) ; (2) whether Lumry's statement to a supervisor that he would not continue shorting his overtime and pay gave the KBI sufficient notice that he was asserting protected FLSA rights; (3) whether Kansas law recognizes retaliatory discharge as a common-law tort when an employee is fired for invoking rights under either the FLSA or its state counterpart, the Kansas Minimum Wage and Maximum Hours Law (KMWMHL), K.S.A. 44–1201 et seq. ; and (4) whether the panel majority erred in concluding sua sponte that Lumry failed to affirmatively establish why his FLSA claim against Blecha was not an adequate alternative remedy to his common-law retaliatory discharge claim against the KBI.

We reverse the panel majority, vacate the district court's judgment on those issues subject to our review, and remand for further proceedings. More specifically, we hold defendants' failure to cross-appeal from the district court's decision regarding Blecha's "employer" status under the FLSA deprived the Court of Appeals of jurisdiction to reach that issue, so we dismiss the cross-petition for review as to that question. We further hold Lumry's complaint about unpaid overtime was sufficient to preclude summary judgment as to whether he engaged in a protected activity. We agree with the panel that Kansas law recognizes retaliatory discharge as a common-law tort when an employee is fired for invoking rights under either the FLSA or the KMWMHL. And, finally, we hold the panel majority erred addressing sua sponte the adequate alternative remedy question. We remand to the district court for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

Due to the procedural posture, all facts and inferences that may be reasonably drawn from the evidence are resolved in Lumry's favor because the district court decided this case against him on summary judgment. Thoroughbred Assocs. v. Kansas City Royalty Co. , 297 Kan. 1193, 1204, 308 P.3d 1238 (2013) ; O'Brien v. Leegin Creative Leather Products, Inc ., 294 Kan. 318, 330, 277 P.3d 1062 (2012). Our factual statement is prepared with that recognition.

Lumry began working for the KBI as a special agent in 2001. In late 2006, the KBI promoted him to a senior special agent. Kelly Ralston was his direct supervisor until January 2008, when Clint Hawkins took over that role because Lumry joined a newly formed Southwest Kansas Drug Task Force. Blecha was KBI director at all times relevant.

The KBI policy in effect when Lumry was an agent stated "timesheets will accurately reflect time worked, leave taken and earning codes charged." It further provided that "[e]mployees are responsible for continually monitoring the accuracy of the information on the payroll ‘stub,’ including compensation, accrued leave balances, deductions, and leave accrual rates."

Lumry alleges he regularly worked overtime without claiming all of it on his timesheets. According to him, this was KBI practice and was routinely expected of him and other personnel. As he explained his experience, every two or three months he would "negotiate" with Ralston how much overtime to claim on his timesheets. Hawkins testified it was common for agents to work overtime.

In October 2007, prior to joining the drug task force, a frustrated Lumry had a "tense" conversation with Hawkins regarding uncompensated overtime during which Lumry says he refused to keep underreporting his hours. Lumry told Hawkins, "I'll work an extra 5 hours a week and give you that extra time; but I'm not going to work 10 and 20 hours a week anymore, or more, of unclaimed overtime."

Hawkins replied that was just what Lumry would have to do.

The following February, Hawkins reviewed Lumry's timesheets after being surprised when Lumry mentioned he was already accruing overtime during a particular pay period. Hawkins compared Lumry's timesheets to those of other agents and concluded Lumry was posting time when others were not present or claiming time. He said he believed Lumry was reporting time he had not worked because Lumry had recorded time when Hawkins knew Lumry was not present where his timesheets reflected. Hawkins particularly focused on the week of February 11, 2008, when Lumry listed hours for a case no longer being worked by the bureau but did not mention this work in a contemporaneous log Hawkins had requested of Lumry's activities that week.

Hawkins notified Ralston, who moved the concern up the chain of command. Blecha ordered an internal investigation that was conducted by Special Agent in Charge Randy Ewy, who confirmed some discrepancies. Ewy agreed Lumry had overstated hours worked, but also noted Lumry's explanation that Lumry often worked more than he charged the agency, thereby "shaving" hours from his timesheets for the KBI's benefit. Ewy did not conclude whether the errors were deliberate falsehoods or just mistakes.

In May 2008, Blecha put Lumry on administrative leave. Blecha later testified he took the issue seriously because law enforcement officers who falsify documents would have no credibility in future court proceedings. Two weeks later, Blecha proposed firing Lumry, claiming Lumry "knowingly and willfully" falsified timesheets. An administrative appeal ensued, but Blecha confirmed the termination.

Lumry complained to the U.S. Department of Labor about uncompensated overtime. The agency investigated and ordered the KBI to pay Lumry $20,715 for unpaid wages and further determined the bureau owed back pay to other KBI employees, including four agents. The KBI complied with the department's findings. The other KBI employees were not subjected to adverse job actions for submitting inaccurate timesheets.

Lumry also filed suit in the United States District Court for the District of Kansas against the State of Kansas, the KBI, and Ralston in his individual capacity for violations of Lumry's rights under the FLSA and the First Amendment to the United States Constitution under 42 U.S.C. § 1983 (2012). But the federal court dismissed all counts. It held subject matter jurisdiction was lacking over the claims against the State and KBI due to Eleventh Amendment immunity and that the 42 U.S.C. § 1983 claims were not against "a state official in his official capacity" as required under that statute. The court further held Lumry failed to state a 42 U.S.C. § 1983 claim against Ralston because he did not allege Ralston participated personally in the alleged unconstitutional acts underlying the claim.

While the federal case was pending, Lumry filed the current lawsuit in Shawnee County District Court, naming as defendants the KBI and, in their individual capacities, Hawkins, Ralston, and Blecha. Lumry alleged one count of retaliatory discharge under the FLSA for his complaints about working uncompensated overtime and another count of retaliatory discharge in violation of the First Amendment under 42 U.S.C. § 1983. The petition was later amended to limit the First Amendment claims to the individual defendants, while adding a claim against the KBI for retaliatory discharge in violation of the KMWMHL.

The state district court proceedings

Following discovery, but before entering a final pretrial order, the district court granted defendants summary judgment. As to the FLSA, the court held that sovereign immunity barred the claim against the KBI. It further held the allegations against Ralston and Hawkins failed because neither was an "employer" for FLSA purposes. See 29 U.S.C. § 203(d) (2012) (defining "employer" as "any person acting directly or indirectly in the interest of an employer in relation to an employee ..."). And while the court agreed Blecha was an employer for FLSA purposes as bureau director, it ultimately rejected the claim against him because it believed Lumry's refusal to work no more than five hours of uncompensated overtime would not have put a reasonable employer on notice that he was asserting protected FLSA rights.

Regarding Lumry's First-Amendment-based allegations under 42 U.S.C. § 1983, the district court held that collateral estoppel barred the claim against Ralston because the federal court had previously dismissed it. The court also held the claims against Blecha and Hawkins failed because Lumry's speech was part of his official duties as a KBI agent, so it was not protected under the First Amendment.

Shifting to the state law claim, the district court held that Lumry could not assert...