Facebook Photos Doom Employee’s FMLA Retaliation Claim

February 28, 2013 | Appeals | Employment & Labor | Insurance Coverage

After working for Advantage Health Physician Network for about 18 months, the plaintiff in this case began taking intermittent leave under the Family and Medical Leave Act, claiming that she was incapacitated from pain from a back injury she had sustained years earlier. About five weeks into her leave, several of her coworkers saw pictures of her at a local festival on Facebook and brought the matter up with their supervisor. After reviewing the matter internally and meeting with the plaintiff, Advantage terminated her for fraud. The plaintiff sued Advantage, asserting that it had retaliated against her for taking FMLA leave. The district court granted summary judgment in favor of Advantage, and the plaintiff appealed.

The U.S. Court of Appeals for the Sixth Circuit found that Advantage had “rightfully considered workplace [FMLA] fraud to be a serious issue,” and ruled that its termination of the plaintiff because of its “honest belief” that she had been dishonest concerning her claim that she was incapacitated constituted a non-retaliatory basis for her discharge. The circuit court found that Advantage’s investigation had been adequate and found that the plaintiff had not refuted Advantage’s honest belief that her behavior in the photos was inconsistent with her claims of total disability.  Thus, the circuit court concluded, “as a result of her fraudulent behavior, her claim of FMLA retaliation fail[ed].” It therefore upheld the district court’s decision in favor of Advantage. [Jaszczyszyn  v. Advantage Health Physician Network, 2012 U.S. App. Lexis 23162 (6th Cir. Nov. 7, 2012).]

Circuit Court Reinstates Nurse’s FMLA Interference Claim

The plaintiff in this case worked as a nurse in the rehabilitation unit of St. Therese of New Hope, a long term care facility in New Hope, Minnesota.  Despite an understanding among employees that St. Therese’s nursing staff could be “floated” to different units within the facility, the plaintiff received training only for the rehabilitation unit and worked there exclusively until she was reassigned to St. Therese’s long term care unit.

The plaintiff, who had earlier begun experiencing symptoms of an undiagnosed anxiety disorder, expressed apprehension about working in a unit for which she was not trained. She emphasized that she was not refusing to work, but requested that she receive unit-specific training prior to reassignment. The plaintiff claimed that her supervisors informed her that she had “no choice. You either work or you don’t have a job and that’s called patient abandonment and you can lose your license.” The plaintiff went to St. Therese’s human resources office, exhibited signs of a panic attack, was instructed to go home, and was told that something would be worked out the next day.

The plaintiff went to the doctor the next day; her doctor suggested the anxiety attack had been situationally triggered, advised therapy, and prescribed two medications. In a note addressed to St. Therese, the plaintiff’s doctor recommended she take the remainder of the week off from work.

At 9:30 that same morning, the plaintiff delivered her doctor’s note to St. Therese’s human resources department. In return, the department provided her with Family and Medical Leave Act (FMLA) forms. Later that day, a member of St. Therese’s human resources staff called the plaintiff at home to inform her that she had been terminated the previous day for walking off the job.

The plaintiff’s doctor returned the FMLA forms two days later, describing the plaintiff as “suffering from anxiety and panic attacks” and requesting she be excused from work for one week due to the severity of her condition. A few days later, St. Therese registered a complaint regarding the plaintiff with the Minnesota Board of Nursing, alleging that she had “refused work assignment & walked out.”

The plaintiff sued St. Therese, alleging among other things that St. Therese had impermissibly interfered with her right to take reasonable leave for medical reasons in violation of the FMLA. St. Therese moved for summary judgment, arguing that the plaintiff was not entitled to FMLA rights because she had no longer been an employee at the time she asserted them and, in any case, she had been terminated for reasons “wholly unrelated to the FMLA.” The district court granted summary judgment in St. Therese’s favor, and the plaintiff appealed.

In its decision reversing the district court, the U.S. Court of Appeals for the Eighth Circuit explained that the FMLA entitles an employee to 12 workweeks of leave during any 12 month period if the employee has a “serious health condition” that makes the employee “unable to perform the functions of the position of such employee.” A “serious health condition” is any “illness, injury, impairment, or physical or mental condition that involves (A) inpatient care in a hospital, hospice, or residential medical care facility; or (B) continuing treatment by a health care provider.” Continuing treatment is defined as “[a] period of incapacity of more than three consecutive, full calendar days and any subsequent treatment or period of incapacity relating to the same condition.”

Applying these definitions, the Eighth Circuit decided that the plaintiff’s diagnosed incapacity for one full week, accompanied by two prescriptions for medication and an advised course of ongoing therapy, satisfied the FMLA standard for a “serious health condition.”

The circuit court then examined whether the plaintiff had sufficiently asserted a case of interference with her FMLA rights.  To have done so, the circuit court continued, the plaintiff must have given timely notice to St. Therese of her need for FMLA leave. It pointed out that the day after she had exhibited signs of severe distress and visible manifestations of anxiety as a result of her work reassignment, she provided St. Therese with a doctor’s note indicating that she may have had a serious health condition.

The circuit court then rejected St. Therese’s argument that the plaintiff was no longer an eligible employee when she put St. Therese on notice of her health condition because her supervisors had construed her leaving work as quitting. According to the circuit court, the plaintiff “only left the premises” upon the instruction of St. Therese. In addition, the circuit court continued, St. Therese admitted that the plaintiff’s supervisors and the human resources staff did not discuss her allegedly voluntary termination until the same morning that plaintiff provided St. Therese with her doctor’s note by 9:30 a.m., and that St. Therese’s response to her submission of her doctor’s note that morning was not to inform her that she was no longer employed, but to provide her with FMLA forms. Accordingly, the Eighth Circuit concluded, there was a question of material fact as to whether St. Therese was on notice of her potentially FMLA-qualifying condition prior to its determination that her employment had ended (whether voluntarily or involuntarily).

The Eighth Circuit therefore ruled that the district court had erred in concluding as a matter of law that the plaintiff could not establish an interference claim under the FMLA. [Clinkscale v. St. Therese of New Hope, 2012 U.S. App. Lexis 23282 (8th Cir. Nov. 13, 2012).]

Circuit Court Affirms Decision Dismissing FMLA Interference and Retaliation Claims

In July 2009, the plaintiff in this case, a billing specialist with CommunityCare HMO, Inc. (CCH), requested nine to 12 weeks of leave under the Family and Medical Leave Act (FMLA) for a knee replacement surgery scheduled for October 2009. However, she used 64 hours of her available FMLA leave that August for a knee injury, and CCH’s human resource manager sent the plaintiff written notice that she had used 64 of her 480 hours of annual FMLA leave. The plaintiff had her knee replacement surgery in October, using FMLA leave.

In November, CCH sent the plaintiff written notice that her remaining FMLA leave would expire on December 16, 2009. Three weeks later, the plaintiff requested an extended leave of absence, stating that if, after her next appointment on December 28, her doctor told her she was able to work, she might be able to return “around” January 4, 2010.

CCH denied the plaintiff’s extended leave request, but offered to accommodate her medical needs in any manner upon a December 16 return, including reduced hours or work restrictions. The plaintiff did not respond to that offer.

On December 16, when the plaintiff did not return to work, CCH, which had a written FMLA policy that stated that any employee who failed to return to work at the expiration of FMLA leave would be subject to termination, terminated her employment. She then filed a complaint alleging CCH had terminated her in violation of the FMLA. The district court granted CCH’s motion for summary judgment, and the plaintiff appealed.

In its decision affirming the district court’s ruling, the U.S. Court of Appeals for the Tenth Circuit first held that the plaintiff had not presented any evidence that CCH had interfered with her rights under the FMLA. As the circuit court noted, it was “undisputed” that prior to her surgery, CCH had given her written notice of the amount of her available FMLA leave and had provided her the full amount of FMLA leave available to her. The circuit court also rejected the plaintiff’s contention that CCH should have granted her extended leave request, explaining that CCH was not obligated to provide more than the statutorily-required amount of FMLA leave.

The circuit court then rejected the plaintiff’s argument that CCH’s stated reason for terminating her was pretext for retaliation. It explained that CCH had stated that it was terminating the plaintiff’s employment because she had exhausted her FMLA leave and had failed to return to work, adding that CCH’s FMLA policy stated that employees could be terminated if they failed to return to work at the expiration of their FMLA leave. The circuit court then concluded that there was no evidence that suggested that CCH’s proffered reason was implausible, inconsistent, incoherent, or otherwise pretextual. Accordingly, it affirmed the district court’s summary judgment dismissal of the plaintiff’s FMLA retaliation claim. [McClelland v. CommunityCare HMO, Inc., 2012 U.S. App. Lexis 24562 (10th Cir. Nov. 29, 2012).]

Circuit Court Rejects EEOC Contention that Medical Information Revealed in Response to Job-Related Inquiries Is Protected under the ADA

The Equal Employment Opportunity Commission (EEOC) sued Thrivent Financial for Lutherans on behalf of Gary Messier, alleging that Thrivent had violated the medical record confidentiality requirements of the Americans with Disabilities Act (ADA). The EEOC asserted that Mr. Messier had been hired by Omni Resources, Inc., a technology consulting agency, to work as a temporary programmer for Thrivent pursuant to an agreement between Omni and Thrivent. According to the EEOC, after Mr. Messier left Omni and Thrivent, he had a difficult time finding a new job and began to suspect that Thrivent was saying negative things about him to prospective employers who called for reference checks.  The EEOC alleged that during reference checks, Thrivent was revealing information about Mr. Messier’s migraine condition to prospective employers in violation of the ADA’s requirement that employee medical information obtained from “medical examinations and inquiries” be “treated as a confidential medical record.”

The district court found that Thrivent had learned of Mr. Messier’s migraine condition outside the context of a medical examination or inquiry and that the ADA’s confidentiality provisions therefore did not apply. Accordingly, it granted summary judgment to Thrivent.

The EEOC appealed to the U.S. Court of Appeals for the Seventh Circuit, arguing that the ADA’s confidentiality provisions protected all employee medical information revealed through “medical inquiries” as well as employee medical information revealed through “job-related” inquiries. The circuit court, however, rejected the EEOC’s argument.

The Seventh Circuit explained that the title of the section of the ADA at issue was “[m]edical examinations and inquiries.” It stated that the use of the inclusive conjunction “and” in the title – instead of a limiting or contrasting conjunction such as “or” – suggested that the examinations and inquiries referred to in the section title were within the same class or type: they both were medical. At the very least, it said, the use of the conjunction “and” indicated that the adjective “medical” modified both “examinations” and “inquiries.”

The Seventh Circuit added that the subject matter discussed in the body of the section confirmed that the word “inquiries” did not refer to all generalized inquiries, but instead referred only to medical inquiries. As the circuit court noted, the entire section was devoted to a discussion of a disabled employee’s “medical record,” “medical condition or history,” “medical files,” and medical “treatment.”

In sum, the circuit court concluded, the EEOC’s argument that the word “inquiries” referred to all job-related inquiries, not to just medical ones, “ignore[d] the content of the rest of the section.” Accordingly, it agreed with the district court that Thrivent had not violated the ADA by allegedly revealing Mr. Messier’s migraine condition because the ADA did not apply. [Equal Employment Opportunity Commission v. Thrivent Financial for Lutherans, 700 F.3d 1044 (7th Cir. 2012).]

Plaintiff’s Claim that She Was Fired Because She Was Ill is Rejected

The plaintiff in this case contended that she was fired in violation of federal law and New York law because she was ill.  In response, her employer contended that she was terminated as part of an effort to reduce costs during an economic downturn. The trial court granted the employer’s motion for summary judgment, and the plaintiff appealed.

In its decision affirming the district court’s ruling, the U.S. Court of Appeals for the Second Circuit first examined the plaintiff’s claim under Section 510 of ERISA, which provides that it is unlawful for an employer to, among other things, terminate an employee either in retaliation for using a qualified employee health plan or to interfere with the employee’s use of that plan. It explained that an “essential element” of this ERISA claim was that defendants were motivated by a specific intent to engage in activity prohibited by Section 510 so that the plaintiff’s loss of health insurance benefits was not “a mere consequence of, but . . . a motivating factor behind, a termination of employment.”

Here, the Second Circuit found, there was no evidence that the supervisors who made the decision to lay off the plaintiff had any knowledge of her health insurance claims or claim history or had terminated the plaintiff to cut health care costs. Moreover, the circuit court rejected the plaintiff’s argument that her employer’s claim that her termination was part of an effort to reduce costs was undercut by the fact that it hired new employees around the same time it fired her, finding that those new employees filled different, preexisting positions.

Additionally, the circuit court rejected the plaintiff’s contention that her firing violated New York law that made it unlawful, among other things, for an employer to discharge an employee because of his or her disability, finding no evidence that the plaintiff’s employer’s proffered reason for terminating her was pretextual or that discriminatory intent motivated her termination. Simply put, the Second Circuit pointed out, the plaintiff “was one of many employees laid off by [her employer] at a time when its business prospects were deteriorating.” Short of speculation, it concluded, there was “no evidence” that the plaintiff’s illness “played even a partial motivating role in the decision to terminate her.” [Goia v. Forbes Media LLC, 2012 U.S. App. Lexis 22689 (2d Cir. Nov. 5, 2012).]

Contractor’s State Law Claims under Group Accident-Protection Policy are Preempted by ERISA

The plaintiff in this case sued North American Benefits Co. (NABCO), BCS Insurance Co. (BCS), and OSJ Corp. d/b/a Mister Towing Services in a Texas state court, alleging that he was covered by a group accident-protection insurance policy that his former employer, Mister Towing Services, had obtained, but that the insurers had refused to pay him for all the medical expenses he incurred after he was injured in an accident at work. The plaintiff asserted claims under the Texas Insurance Code and for breach of the duty of good faith and fair dealing.

NABCO and BCS removed the case to federal court and moved to dismiss, arguing that the plaintiff’s state law claims were preempted by ERISA.

In its decision dismissing the complaint, the court first found that the policy met the definition of an “employee welfare benefit plan” under ERISA because it had been purchased by Mister Towing Services to provide accidental death and dismemberment, accidental medical and dental expense, and accidental weekly indemnity insurance benefits to covered “Insureds.”

The court then rejected the plaintiff’s argument that ERISA’s “safe harbor” provision excepted the policy from ERISA. As the court observed, the policy required Mister Towing Services to pay the premiums and required Mister Towing Services to provide enrollment documents and other information to help with administration. The policy also provided for an “ongoing administrative program” to identify those eligible for coverage and to calculate premium amounts. According to the court, these requirements disproved two of the safe harbor elements: (i) plans under which no contributions were made by an employer, and (ii) plans under which the sole functions of the employer were to permit the insurer to publicize the program to employees or members, to collect premiums through payroll deductions or dues checkoffs, and to remit them to the insurer.

In addition, the court rejected the plaintiff’s contention that as an independent contractor of Mister Towing Service and not an employee, he was not a participant or beneficiary and that ERISA therefore did not preempt his claims. The court reasoned that the policy defined an “Insured” as “an Eligible Person” who was covered under the policy and defined “Eligible Person” to include a “Contractor” if that person were identified by the “Policyholder or the Contractor” in one of three specified ways, as the plaintiff had been. 

Accordingly, the court ruled that the plaintiff’s state law claims – for violations of the Texas Insurance Code and for breach of the duty of good faith and fair dealing in the denial of benefits – were completely preempted by ERISA. The court concluded by adding that it also had to dismiss the plaintiff’s jury demand, as there was no right to a jury trial in an ERISA case. [Salman v. North American Benefits Co., 2012 U.S. Dist. Lexis 174068 (S.D. Tex. Dec. 7, 2012).]

Reprinted with permission from the March 2013 issue of the Employee Benefit Plan Review – From the Courts.  All rights reserved.

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