United States Court of Appeals

Fifth Circuit

FILED

May 27, 2003

Charles R. Fulbruge III

Clerk

REVISED JUNE 2, 2003

In the

United States Court of Appeals

for the Fifth Circuit

_______________

m 02-50446

_______________

CAROL FARIS,

Plaintiff-Appellee,

VERSUS

WILLIAMS WPC-I, INC., ET AL.,

Defendants,

NEXTIRA LLC,

ALSO KNOWN AS WILLIAMS COMMUNICATIONS SOLUTIONS LLC;

SUSAN BAIRD,

IN HER INDIVIDUAL CAPACITY,

Defendants-Appellants.

_________________________

Appeal from the United States District Court

for the Western District of Texas

_________________________
2

Before GARWOOD, SMITH, and BARKSDALE,

Circuit Judges.

JERRY E. SMITH, Circuit Judge:

Nextira LLC (“Nextira”) and Susan Baird

appeal a determination that a post-termination

release signed by Carol Faris was unenforceable under 29 C.F.R. § 825.220(d), a regulation issued pursuant to the Family and Medical

Leave Act of 1993 (“FMLA”). Concluding

that enforcement of the release is not prohibited by the regulation, and that the release was

ratified by Faris’s failure to tender back the

consideration paid for the signing of the release, we reverse and render judgment for

appellants.

I.

Faris worked as an occupational health

specialist for Nextira from November 1997 to

June 1999, when Baird, her supervisor, terminated her, citing poor performance. Faris received two weeks’ pay in lieu of notice. On

the same day, she was offered an additional

$4,063.32, the equivalent of one month’s salary, in exchange for signing a release that purported to waive her rights to, inter alia, “all

other claims arising under any other federal,

state or local law or regulation;” it did not

specifically mention the FMLA. She also received a memorandum advising that she had

45 daysto consider the release and seven days

to revoke ifshe signed, though the parties dispute whether she was so advised verbally.1

Faris signed the release and received

$4,063.32; she understood that the payment

was in return for the signing of the release.

She has not tendered back the payment.

Faris sued Nextira and Baird (collectively,

“Nextira”), asserting she was fired in retaliation for asserting her rights under the FMLA.

Following discovery, defendants moved for

summary judgment as to the enforceability of

the release, and Faris moved for partial summary judgment on whether the release was per

se unenforceable under § 825.220(d) (“the

regulation”).

The court denied defendants’ motion and

granted Faris’s, holding that the plain language

of the regulation dictated that FMLA claims

are not waivable. The district court certified

the questions of law addressed in its summary

judgment order under 28 U.S.C. § 1292(b),

and we granted defendants leave to bring this

interlocutory appeal.

II.

Defendants assert that the district court

erred in its determination that the plain language of the regulation renders Faris’s waiver

void, arguing instead that, under a plain language reading, the regulation does not reach

the waivability of post-termination FMLA

claims. Defendants contend, in the alternative,

that, if the regulation is ambiguous, the relevant law under similar statutory schemes, and

the common law presumption of and favor

toward waivability, also support a limited

reading of the regulation.2 We conclude that

1 Farisstatesthatshewas pressured into signing

the release because she was confronted by Baird

and another employee and told, “This is your last

opportunity to sign the release if you expect to get

compensation for it.”

2 Defendants also argue that, if the regulation

extends to the waiver at issue here, it is invalid

under Chevron U.S.A. Inc. v. N.R.D.C., 467 U.S.

837 (1984). This argument was not presented to

nor passed on by the district court, and therefore

may not be considered on appeal. See Picco v.

(continued...)
3

the proper reading of the regulation is that it

does not apply to post-dispute claims for

damages under the FMLA.

We review de novo a grant or denial of

summary judgment, NCNB Tex. Nat’l Bank v.

Johnson, 11 F.3d 1260, 1264 (5th Cir. 1994),

applying the same standard as did the district

court, Deas v. River W., L.P., 152 F.3d 471,

475 (5th Cir. 1998). “Summary judgment is

proper when no issue of material fact exists

and the moving party is entitled to judgment as

a matter of law. Questions of fact are viewed

in the light most favorable to the nonmovant

and questions of law are reviewed de novo.”

Id.

A.

Defendants argue that the plain language of

the regulation demonstrates that it does not

reach retaliation claims under FMLA by former employees. Defendants focus in part on

the meaning ofthe term“employee,” reasoning

that the term implicitly refers only to current

employees and cannot extend to former employees. Faris argues that the plain language

doesreach former employees, and this wasthe

district court’s conclusion.

The regulation reads, in relevant part:

“Employees cannot waive, nor may employers

induce employees to waive, their rights under

FMLA.” 29 C.F.R. § 825.220(d). FMLA

§ 2611(3) defines “employee” by reference to

the FLSA, 29 U.S.C. § 203(e), which provides

that “the term‘employee’means anyindividual

employed by an employer.”

This definition, by itself, is unhelpful. In

Nationwide Mut. Ins. Co. v. Darden, 503 U.S.

318, 323 (1992), the Court stated that this

definition, as applied under ERISA, “is completely circular and explains nothing.” The

term “employee” may have different meanings

in different acts, or even in different provisions

of the same act. See Robinson v. Shell Oil

Co., 519 U.S. 337, 341-44 (1997) (considering the meaning of employee in the title VII

context). In Robinson, the Court noted that

although some sections of title VII unambiguously refer to only current or past employees,

those examples at most demonstrate that

the term “employees” may have a plain

meaning in the context of a particular

sectionSSnot that the term has the same

meaning in all other sections and in all

other contexts. Once it is established

that the term “employees” includes former employeesin some sections, but not

in others, the term standing alone is

necessarily ambiguous and each section

must be analyzed to determine whether

the context gives the term a further

meaning that would resolve the issue in

dispute.

Id. at 343-44 (citations omitted). Similarly,

the term “employee” is ambiguous as used in

the FMLA, because in various contexts it refers to only current employees, but in other

situations it refers to former employees.3 We

2

 (...continued)

Global Marine Drilling Co., 900 F.2d 846, 849

(5th Cir. 1990).

3 Other circuits also have determined that “employee” is ambiguous in the FMLA context. See

Smith v. BellSouth Telecomms., Inc., 273 F.3d

1303, 1307-13 (11th Cir. 2001) (finding “employee” ambiguous and deferring to Department of

Labor’s interpretation that the term includes prospective employees for purposes of discrimination

(continued...)
4

must look at the context in which the term is

used to see whether the waiver prohibition applies to retaliation claims.

The term “employee,” throughout § 825.-

220, appears consistently to refer to current

employees. Several uses unambiguously refer

to current employees only. Section 825.220-

(b)(1) prohibits “transferring employees from

one worksite to another for the purpose of reducing worksites, or to keep worksites, below

the 50-employee threshold for employee eligibility under the Act[.]” Because one can

transfer only a current employee, this use is

unambiguous. Similarly, § 825.220(c) prohibits employers “fromdiscriminating against employees or prospective employees who have

used FMLA leave.” By distinguishing between “employees” and “prospective employees,” the regulation implies that “employee”

describes only those that are currently employed.

Looking back to § 825.220(d), we see that

the examples immediately following the statement of nonwaivability both concern current

employees. The examples are as follows:

For example, employees(or their collective bargaining representatives) cannot

“trade off” the right to take FMLA leave

againstsome other benefit offered bythe

employer. This does not prevent an

employee’s voluntary and uncoerced

acceptance (not as a condition of employment) of a “light duty” assignment

while recovering from a serious health

condition (see § 825.702(d)). In such a

circumstance the employee’s right to

restoration to the same or an equivalent

position is available until 12 weeks have

passed within the 12-month period,

including all FMLA leave taken and the

period of “light duty.” 

In the context of this regulation, there are

strong indications that “employee” refers only

to current employees. It certainly cannot be

said that the usage unambiguously encompasses former employees.

B.

Defendants argue that the regulation extends only to “substantive rights” under the

FMLA, rather than to post-dispute causes of

action for retaliation. The proper focus is on

the meaning of the phrase “rights under

FLMA,” which in context limitsthe regulation

to prospective waivers of rights under the

statute.

Several factors support the interpretation

that this regulation applies only to waiver of

substantive rights under the statute, such as

rights to leave, reinstatement, etc., rather than

to a cause of action for retaliation for the exercise of those rights. The statute and regulation consistently use the term“rights under the

law” or “rights under FMLA” to refer to the

statutory rights to leave, certain conditions of

that leave, and restoration, as set forth in 29

U.S.C. §§ 2612-14. Conversely, although

§ 825.220 explicates the requirements of 29

U.S.C. § 2615(a),4the regulation never refers

3

 (...continued)

claims); Duckworth v. Pratt & Whitney, Inc., 152

F.3d 1, 9-11 (1st Cir. 1998) (same). 

4 29 U.S.C. § 2615(a) states: “It shall be unlawful for any employer to interfere with, restrain,

or deny the exercise of or the attempt to exercise,

any right provided under this chapter.”
5

to the cause of action for damages as a right

under FMLA.5

Indeed, the regulation begins with the title

“How are employees protected who request

leave or otherwise assert FMLA rights?” It

then goes on to describe how FMLA rights are

protected, discussing the prohibition of discrimination as a method of protecting those

rights. The cause of action for discrimination,

however, is never described as an FMLA right

itself, within the regulation or elsewhere. Subsection (d) must be read in conjunction with

the heading describing protectionsfor employees who “request leave or otherwise assert

FMLA rights,” because it is responsive to that

heading, limiting waiver ofrights considered in

the heading.

The examples of nonwaivability, quoted

above, concern prohibitions onthe prospective

waiver of rights under FMLA. In the examples, the rightsto leave and restoration are the

“rights under FMLA.” The cause of action for

retaliation is unaddressed by these examples,

but rather is a protection for FMLA rights, the

waiver of which is not prohibited by the regulation. This is consistent with the rest of the

language of the regulation. A plain reading of

the regulation is that it prohibits prospective

waiver of rights, not the post-dispute settlement of claims.

C.

Our reading of the regulation is bolstered

by public policy favoring the enforcement of

waivers and our knowledge that similar waivers are allowed in other regulatory contexts.

Waivers of the right to bring suit under the

Age Discrimination in Employment Act

(“ADEA”) are enforced by this court and are

not void as against public policy. “[A]lthough

an employee cannot waive the right to file a

charge with the [Equal Employment Opportunity Commission (“EEOC”)], the employee

can waive not only the right to recover in his

or her own lawsuit but also the right to recover in a suit brought by the EEOC on the

employee’s behalf.” EEOC v. Cosmair, Inc.,

L'Oreal Hair Care Div., 821 F.2d 1085, 1091

(5th Cir. 1987). Therefore, although a defendant cannot waive hissubstantive rights under

the statute, he can waive his right to money

damages.

Releases of title VII claims are also enforced. In Rogers v. Gen. Elec. Co., 781 F.2d

452 (5th Cir. 1986), we noted that

[a] general release of Title VII claims

does not ordinarily violate public policy.

To the contrary, public policy favors

voluntary settlement of employment

discrimination claims brought under

Title VII. While a release of Title VII

claims will not ordinarily violate public

policy, an employee may validly release

only those Title VII claims arising from

discriminatory acts or practices which

antedate the execution of the release.

Thus, an otherwise valid release that

waives prospective Title VII rights is

invalid as violative of public policy.

Id. at 454 (citations omitted).6

5 We also have distinguished the cause of action

for retaliation from the rights under the FMLA.

See, e.g., Chaffin v. John H. Carter Co., 179 F.3d

316, 319 (5th Cir. 1999) (describing “substantive

rights under the FMLA,” as distinguished from the

cause of action for retaliation).

6 TheEEOC hasreleased enforcement guidance

discussing the contours of non-waivable employee

(continued...)
6

It is not necessarily dispositive that postdispute waiver is allowed under the ADEAand

title VII. We must carefully consider whether

there are aspects of title VII, ADEA, and

FMLA that might encourage differing protections and interpretations.7

 We know, however, of no good reasonSSnor has Faris suggested oneSSwhy the government would

proscribe waiver for FMLA retaliation claims

and yet favor waiver of claims for age discrimination under ADEA and for civil rights

violations under title VII. Had the Secretary

intended such a departure from the policy employed in analogous areas, one would expect

the Secretary would have manifested this intent forthrightly. Not only does the regulation

not do so, it employs examples that are entirely consistent with title VII and ADEA

waiver requirements.8 The policies employed

in the title VII and ADEA contexts are therefore highly persuasive.

We interpret the regulation to apply only to

waivers ofsubstantive rights under the FMLA,

rather than to claimsfor money damages, consistent with public policy and the law under

similar regulatory regimes. In practice, this

may render the regulation applicable only to

current employees, as defendantssuggest, but

we need not resolve that question. We therefore conclude that the regulation did not render Faris’s waiver of her claims under the

FMLA unenforceable.

III.

Defendants seek review of the denial of

their motion for summary judgment, arguing

that the release is enforceable because Faris

has not tendered back her payment for the release, precluding her from arguing misrepresentation or duress. In Williams v. Phillips

Petroleum Co., 23 F.3d 930, 935 (5th Cir.

1994), we held that “[o]nce a party establishes

that his opponent signed a release that addresses the claims at issue, received adequate

consideration, and breached the release, the

opponent hasthe burden of demonstrating that

the release was invalid because of fraud, duress, materialmistake, orsome other defense.”

But,

[e]ven if a release istainted by misrepresentation or duress, it is ratified if the

6

 (...continued)

rights under statutes enforced by the Commission,

which include the ADEA, title VII, the Americans

with Disabilities Act, and the Age Discrimination

in Employment Act. See EEOC NOTICE NO.

915.002 § I (Apr. 10, 1997). Though the

Commission “recognized that individuals possess

a non-waivable right to file charges with the

EEOC,” id. § III(A), it expressed its “support for

post-dispute agreements entered into knowingly

and voluntarily to settle claims of discrimination,”

id. § III(C) (emphasis added).

7 See Pettway v. Am. Cast Iron Pipe Co., 411

F.2d 998, 1005-06 (5th Cir. 1969) (employing the

FLSA and the NLRA in interpreting title VII, but

noting that reliance on other statutes “must necessarily be guarded because the differences between those Acts and title VII may well outnumber

the similarities”); see also Smith, 273 F.3d at 1310

(“While cases decided under other employment

statutes prohibiting discrimination and retaliation

may be instructive, we must be attentive to the way

the statutes differ in their language, their purposes,

and their scope of protection.”) (citing Pettway).

8 Although no court has explicitly considered

the argument presented by Faris, two circuits have

allowed waiver of FMLA retaliation claims. See

Halvorson v. BSA, 2000 U.S. App. LEXIS 9648,

at *6 (6th Cir. 2000); Schoenwald v. ARCO Alaska, Inc., 1999 U.S. App. LEXIS 20955, at *5 (9th

Cir. 1999).
7

releasor retains the consideration after

learning that the release is voidable. A

person who signs a release, then sues his

or her employer for matters covered

under the release, is obligated to return

the consideration. Offering to tender

back the consideration after obtaining

reliefin the lawsuit would be insufficient

to avoid a finding of ratification.

Id. at 937.

Although Faris does allege duress, it is undisputed that she received $4,063.32 for signing the release and has not tendered back the

consideration. The release is ratified. We

therefore REVERSE and RENDER judgment

for defendants.