April 2009

It happens more frequently than the drafters of the Family and Medical Leave Act probably thought – employee goes out on FMLA leave and, in his/her absence, the employer learns from those who are filling in that the employee is guilty of serious misconduct or neglect. In this sort of situation the employee finds him or herself in a sort of Catch-22. On the one hand, the employer is learning of a previously undetected problem that came to light only because the employee was away on leave. On the other hand, the employer is well aware that FMLA leave is a federally protected right that also requires the employee’s reinstatement to “the same or equivalent position” at the conclusion of the leave. However, a recent decision issued on St. Patrick’s Day – March 17, 2009 – by the Seventh Circuit Court of Appeals in Chicago supported an employer’s right to terminate based on employee misconduct uncovered during his FMLA leave.

The facts of the case were simple. The Plaintiff, a terminal manager for a trucking company, was approved for FMLA leave due to his serious health condition. While the Plaintiff was on FMLA leave, several replacement workers that had been hired to cover for him reported discrepancies between freight delivery and other records and the computer entries the Plaintiff had made. Following further investigation, the company Vice President of Operations determined that the Plaintiff had deliberately falsified his computer entries in order to cover up widespread disorganization at his terminal, where deliveries were frequently late, damaged, etc. The employer allowed the Plaintiff to stay on his FMLA leave through its completion, but then terminated the Plaintiff’s employment on the day he returned from that leave.

The ensuing lawsuit brought by the discharged terminal manager alleged both: (1) “interference” with his FMLA right to reinstatement; and (2) “retaliation” for his exercise of FMLA rights. As to the first issue the Court, citing a prior appellate court decision applicable in Minnesota and Iowa, stated that the employer would not be held liable for interference with FMLA rights if it could “prove it would have made the same decision had the employee not exercised… FMLA rights.” Regarding the second claim of retaliation, the court rejected the employee’s argument that his employment history was “positive” prior to taking FMLA leave. The Court held that “the relevant inquiry is [Plaintiff’s] job performance history as known to [the employer] at the time of his termination.”

This decision is of benefit to employers for a number of reasons. First, as previously mentioned, these scenarios happen more often than one might imagine. Temporary replacements uncover all sorts of things when someone goes out on leave, especially where, as in this case, the employee was deliberately covering up misconduct. Second, it upholds an employer’s right to discharge an employee for misconduct under certain circumstances despite the awkward timing of a protected FMLA leave. Third, it dispenses with any necessity of reinstating a wrong doer for some artificial period of time simply out of fear of an FMLA claim, since the Plaintiff in this case was fired the day he returned from FMLA leave. However, notwithstanding all of the above, employers are still well advised to seek the advice of knowledgeable legal counsel in circumstances of this sort because the legality of their actions may turn on minute details… proving that someone would have been discharged regardless of FMLA leave, after all, may be easier said than done.

Questions? Please contact WS Shareholder and Senior Attorney James Sherman in the firm’s Minneapolis office at (952) 746-1700, or jasherman@wesselssherman.com.