Question:

My question concerns the job protection provision of the Family and Medical Leave Act (“FMLA”). One of our employees has been on FMLA leave for three weeks to provide medically necessary care to his spouse. He is due to return to work next week. In his absence, we discovered evidence that the employee failed to complete assigned tasks, which we consider serious misconduct. We believe that we have grounds to terminate him based on this misconduct, but are concerned that the FMLA requires us to return him to his job. Are there exceptions to the job protections that are built into the FMLA? If we fire him when he returns next week, do we risk being sued?

Answer:

You are wise to be cautious about terminating an employee who is or has been on an approved FMLA leave. Both the FMLA and the California Family Rights Act (CFRA) provide eligible employees with up to 12 workweeks of unpaid leave a year for specific reasons, including providing care for an immediate family member (spouse, registered domestic partner, child, or parent) with a serious health condition. Generally, upon returning from FMLA or CFRA leave, an employee must be restored to his or her original job or to an “equivalent” job (meaning a job virtually identical to the original job in terms of pay, benefits, and other employment terms and conditions).

However, an employee’s right to return to work after FMLA or CFRA leave is not unlimited, and there are exceptions to the law. Employers are not required to reinstate employees who would have been terminated due to a general layoff. Under limited circumstances, where return to employment will cause “substantial and grievous economic injury” to its operations, an employer may refuse to reinstate certain highly-paid, salaried “key” employees. A third exception, relevant to your question, occurs when an employer discovers information during an employee’s FMLA/CFRA leave that would otherwise form the basis of a valid termination.

A good example of the third exception is provided by a recent 7th U.S. Circuit Court of Appeals case. Although it is a case out of Illinois, it provides helpful guidance. Kevin Cracco was employed by Vitran, a trucking company, as Service Center Manager. In October 2006, Mr. Cracco was granted a medical leave under the FMLA. Vitran hired temporary employees to cover his responsibilities during his absence. These employees discovered several problems that had arisen during Mr. Cracco’s supervision, including undelivered or damaged freight, unresolved customer complaints and incorrectly handled overtime payments. An investigation found that Mr. Cracco had deliberately disguised late and damaged deliveries. The day Mr. Cracco returned from FMLA leave, Vitran terminated his employment.

Mr. Cracco filed a lawsuit, claiming that Vitran interfered with his FMLA rights by failing to return him to his position and retaliated against him by firing him. The Court found that the timing of Mr. Cracco’s termination could not establish a causal connection between his leave and his termination. Instead, the court held that “the fact that the leave permitted the employer to discover the problems cannot logically be a bar to the employer’s ability to fire the deficient employee.” The Court reasoned that employers should not be forced to choose between reinstating a substandard employee, in that case one who engaged in misconduct, or risking liability under the FMLA.

In your question, you characterize the misconduct of your employee who is on FMLA leave as serious. The question does not indicate if the employee is subject to a collective bargaining agreement or employment agreement, which may also influence your ability to terminate his employment. In deciding whether or not to terminate the employee, you will have to determine if the misconduct is serious enough to warrant discharge, or if you are better served returning the employee to work with a written warning informing him of the misconduct and giving him the opportunity to improve, or with a last chance warning to improve his performance. Before making a decision, you should closely examine the level of misconduct in which the employee engaged, review whether there is documentation that supports the finding of misconduct, and determine whether employees who have engaged in similar misconduct have been terminated or otherwise disciplined. Ultimately, if the employee files a lawsuit claiming discrimination for exercising his rights under FMLA/CFRA, the employer must show that it would have reached the same decision, even if the employee had not exercised those rights.
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