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Are You Illegally Penalizing Employees For Taking Leave?

Employers may be required to adjust their performance standards so an employee will not be penalized for taking qualified leave under the Family and Medical Leave Act (“FMLA”), according to the Seventh Circuit Court’s decision in Pagel v. TIN Inc.

In that case, the defendant, a manufacturer and supplier of containerboard, hired the plaintiff as an outside salesman.  The plaintiff then started having chest pain and labored breathing.  As a result, he was in and out of work for testing and surgery.  In between absences, the plaintiff was notified that his sales revenue and volume had declined over the past two years, and if he did not improve, he could be fired.  While the plaintiff was out on leave, the regional sales manager notified him that he would do a sales ride-along the following day to view the plaintiff’s performance; normally these are scheduled in advance.  The plaintiff conducted the sales ride-along with the manager and was subsequently terminated, in part for poor performance on the sales ride-along.

The plaintiff filed suit under the FMLA, which provides eligible employees suffering from serious medical conditions, up to twelve weeks of unpaid leave during a twelve-month period.  The plaintiff claimed interference and retaliation.  The Court reversed the lower court’s grant of summary judgment in favor of the employer on both claims, and remanded the case.

Referring to the interference claim, the Court explained that the FMLA does not require an employer to “adjust its performance standards for the time an employee is actually on the job, but it can require that performance standards be adjusted to avoid penalizing an employee for being absent during FMLA-protected leave.”  In this case, the employer did not adjust the performance requirements to take into account the FLMA leave.  With respect to the retaliation claim, the Court was persuaded there was a genuine issue of material fact primarily because the evidence showed that account managers need one week to schedule and prepare for customer visits, and in giving the plaintiff one day’s notice, it was possible the defendant was setting the plaintiff up to fail.

One key issue in this case was timing.  The plaintiff’s performance and sales figures had been declining for two years.  Had he been discharged prior to taking FMLA leave, the plaintiff’s termination would not have been in violation of his FMLA rights.  Further, the employer would have been able to prove a nexus between poor performance and disciplinary action.  Employers need to move swiftly to respond and correct performance issues because if the disciplinary action is too attenuated from the performance issue, the action may face more scrutiny and may be attributable to some other circumstance occurring during the delay.  Because the employer waited two years to address declining sales figures, the Court suggested that poor performance may have been a pretext for something else.  Employers – respond timely to correct performance issues!

Brody and Associates regularly advises on compliance with the FMLA and on employment laws in general.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.965.0560.