Third Circuit Court Offers Employers Insight into FMLA and ADA

The Third Circuit Court of Appeals recently waded into the waters of the Family Medical Leave Act of 1993 (FMLA) and the Americans with Disabilities Act (ADA), finding that an employer did not violate the FMLA or ADA where it legitimately believed an employee was misusing FMLA leave, and terminated the employee as a result.

In this case, Capps v. Mondelez Global, LLC, the employee had a medical condition that caused arthritis in his hips. The employee had hip replacement surgery and afterwards he was approved for intermittent FMLA leave to address residual pain and occasional flare-ups.  After the employee returned from one of his intermittent leaves, the employer discovered through an anonymous source that the employee had been convicted for DUI on one of the days that he had been out on leave. The employer terminated the employee for violating its dishonesty policy after he failed to provide sufficient documentation supporting his FMLA leave.

The employee sued claiming violations of the FMLA and ADA. As for the employee’s FMLA retaliation claim, the court found that the claim failed because the employer was able to establish that it terminated the employee for misusing his FMLA leave and for being dishonest about it, and because the employee could offer no evidence to suggest that the employer did not honestly hold that belief.  The court also noted that there was no evidence showing that the employee had ever been denied intermittent FMLA prior to the employer’s discovery of his DUI conviction, nor was there any evidence of discriminatory animus on the part of the employer prior to that time. As for the employee’s FMLA interference claim, the court found that claim failed as well where there was no evidence showing that FMLA benefits had actually been withheld from the employee.

Turning to the ADA, the employee argued that his request for intermittent FMLA leave was protected by the ADA and that his employer failed to accommodate his disability.  The court acknowledged that, under some circumstances, a request for FMLA leave may also qualify as a request for a reasonable accommodation. However, in this case, the court found that even if the employee’s request for intermittent FMLA leave could be construed as a request for a reasonable accommodation, there was still no evidence to suggest that he was denied requested leave at any point.

So what insights does this case offer to employers?  

First, it highlights the importance of distinguishing between an employee’s request and utilization of FMLA leave, and an employee’s conduct or activities while on leave.  An employee clearly may not be disciplined for the former, but this case confirms that the FMLA does not provide an absolute shield for the latter, particularly where misuse of FMLA leave is concerned. Second, the decision highlights the interplay between the FMLA and the ADA and underscores the importance of evaluating leave requests individually and in context.

First Circuit Revives Class-Action Overtime Lawsuit over Absent Comma

Sometimes, small things can turn out to be very big.  Take punctuation, for instance.  Just recently, the First Circuit Court of Appeals issued a decision that proves the point: finding that an absent comma created an ambiguity in Maine’s overtime law, the court reversed summary judgment against several truck drivers and revived their class-action lawsuit against Oakhurst Dairy for unpaid overtime.

At issue in the court’s decision is the meaning of an exemption in the overtime law that covers employees whose work involves the “canning, processing, preserving, freezing, drying, marketing, storing, packing for shipment or distribution” of certain food products.  The specific issue revolves around the meaning of “packing for shipment or distribution,” which the parties had disputed during summary judgment proceedings at the District Court. The drivers argued that the phrase refers to the single activity of “packing,” which may be done for either “shipment” or “distribution.”  Because the drivers were not involved in “packing” goods, the drivers argued that they did not fall under the exemption and were therefore entitled to overtime. Oakhurst argued, however, that the phrase “packing for shipment or distribution” encompasses two distinct activities – “packing for shipment” and “distribution” – each of which is a stand-alone exempt activity.  Because the delivery drivers were engaged in the “distribution” of goods, Oakhurst argued that the drivers were exempt and therefore not entitled to overtime. After considering these dueling interpretations, the District Court agreed with Oakhurst’s interpretation and granted summary judgment in its favor.

The drivers appealed and presented the First Circuit with a single question, which was: what does the phrase “packing for shipment or distribution” really mean?  To resolve this question, the court looked first to Maine precedent construing the exemption.  Although Oakhurst pointed to a Superior Court decision construing the exemption in its favor, the First Circuit declined to give it any weight as it was not binding authority.  So, the court turned to the text of the exemption and addressed several canons of interpretation offered by the parties.

For its part, Oakhurst argued that its interpretation was supported by the rule against surplusage, which treats each word in a statute as having an independent meaning so as to eliminate redundancies.  Explaining that “shipment” and “distribution” are synonyms, Oakhurst argued that its interpretation was the only way to avoid making the words “shipment” and “distribution” redundant.  Oakhurst also pointed to the convention of using a conjunction to indicate the last item in a series and argued that the lack of a conjunction before “shipment,” and the presence of one before “distribution,” indicated that “distribution” was the last item in the series. Finally, Oakhurst argued that, although a serial comma before “distribution” and after “shipment” would have conclusively established its interpretation, the serial comma was missing because the drafting manual for the Maine Legislature expressly advises drafters not to use it (advice that certainly did not come from E.B. White or his Elements of Style).

Countering Oakhurst’s interpretation, the drivers argued that “shipment” and “distribution” are not synonyms and that their use in connection with “packing” creates no redundancies.  Digging further into the text of the exemption, the drivers pointed out that it is comprised of a series of verbal nouns that ends with “packing” and that, because “shipment” and “distribution” are the only non-verbal nouns in the series, the doctrine of parallel usage implies that those terms serve the same grammatical role by modifying “packing.” As for the missing serial comma, the drivers argued that the Legislature’s drafting manual is not “dogmatic” and that, if the Legislature had actually intended “distribution” to be a distinct activity, the missing comma would give rise to the very ambiguity that the drafting manual was intended to avoid.

Acknowledging  that there was “no comma in place to break the tie” between the parties’ interpretations, the First Circuit turned to the exemption’s purpose and legislative history. However, the court found these provided no more clarity than the text. Finding itself back where it began, the court fell back on yet another rule of construction, which instructs that where a provision in the state’s wage and hour laws is ambiguous, the provision should be construed liberally to further the remedial purpose of the statute.  Applying that rule of construction in this case, the court concluded that the ambiguity favored the drivers’ more narrow interpretation of the exemption.

Update on Title VII and Sexual Orientation Discrimination

Updating our previous post on this issue, the Eleventh Circuit Court of Appeals recently affirmed the dismissal of a complaint alleging sexual orientation discrimination under Title VII.   In its 2-1 decision in Evans v. Georgia Regional Hospital, the court explained that its prior precedent foreclosed the ability to bring a claim for sexual orientation discrimination under Title VII.   The court looked specifically to its decision from 1979 in Blum v. Gulf Oil Corp., where it held that Title VII did not prohibit the discharge of an employee based on his homosexuality.  Although the plaintiff in Evans argued that Blum was not binding, the court concluded otherwise and further noted that every other circuit that has addressed the issue so far has also found sexual orientation discrimination not actionable under Title VII (including the First Circuit in Higgins v. New Balance Athletic Shoe).

In affirming the dismissal, the court distinguished between sexual orientation discrimination and discrimination based on an individual’s failure to conform to a gender stereotype.  The court acknowledged that, in the latter case, discrimination based on gender non-conformity is sex-based discrimination.   This so-called sexual stereotype theory was first articulated by the Supreme Court in its 1989 decision in Price Waterhouse v. Hopkins.  However, the Eleventh Circuit found that while Price Waterhouse confirmed that gender non-conformity claims may be brought under Title VII, that decision did not squarely address whether Title VII prohibits sexual orientation discrimination.  As a result, the Eleventh Circuit found that Price Waterhouse did not justify departing from its prior precedent in Blum.

The majority opinion in Evans was accompanied by a strong dissent, which essentially argued that when an employee alleges discrimination because of sexual orientation, the employee necessarily alleges that he or she has been discriminated against for failing to conform to the employer’s image of what men or women should be, and that this is discrimination “because of sex.”

Given the split decision in the Evans case, there is a chance it may be reviewed by the entire panel of the Eleventh Circuit.  And, in light of recent developments in other circuits, it very well may be that the issue is headed for the Supreme Court.

Developments in Title VII and Sexual Orientation Discrimination

Many state anti-discrimination laws, such as those in Maine, Massachusetts and New Hampshire, specifically prohibit employers from discriminating against individuals on the basis of sexual orientation. To the surprise of many employers, this explicit prohibition is absent under federal law. However, recent activity in the federal courts may be changing that.

For a number of years now, the EEOC has taken the position that Title VII of the Civil Rights Act prohibits sexual orientation discrimination because it is discrimination based on “sex.” The EEOC even has a webpage summarizing the published decisions where it has taken this position in enforcement actions, including its decision in Baldwin v. Department of Transportation (July 15, 2015) where it concluded that an allegation of sexual orientation discrimination necessarily states a claim for discrimination on the basis of sex. The EEOC’s position has generally been at odds with decisions from federal courts, including the First Circuit Court of Appeals, which held in Higgins v. New Balance Athletic Shoe, Inc. (1st Cir. 1999) that sexual orientation is not a protected class under Title VII.

Now, it appears that the EEOC’s position may be gaining traction in the federal courts. For example, in October 2016, the Seventh Circuit Court of Appeals announced that its entire panel of judges would rehear arguments in a case decided earlier in the summer, in which a three-member panel held that sexual orientation was not a protected class under Title VII. Oral argument in that case, Hively v. Ivy Tech Community College, was held in November 2016. More recently, in January 2017, the Second Circuit Court of Appeals heard oral argument in Christiansen v. Omnicom Group, Inc., where questions from the Court suggested that it might be willing to reconsider whether Title VII’s prohibitions encompassed discrimination based on sexual orientation. These two appellate court developments followed activity at the district court level, where courts in Pennsylvania (EEOC v. Scott Medical Health Center, P.C. (November 2016)) and Nevada (Roberts v. Clark County School District (October 2016)) extended Title VII’s protection to discrimination based on sexual orientation and gender identity.

Obviously, the outcome of these cases remains to be seen, and it is unclear how the new Trump administration will affect the EEOC’s activities. Employers will therefore want to stay tuned in 2017 for new developments in this area of discrimination law.

2016 OSHA Year in Review

Preti Flaherty's Laura Rideout, an attorney practicing with the firm's Litigation and Environmental Groups, has written a year-end overview of several noteworthy OSHA-related developments in the past year. These developments included issuance of final rules setting forth new compliance obligations, previously issued rules with compliance deadlines that came into effect this year, as well as updated guidance.

Read the full overview on Preti Flaherty's website: http://www.preti.com/environmental/publications/2016-osha-year-in-review/.

End of the Year News from the EEOC

The EEOC closed out 2016 with several reports that provide interesting reading for employers heading into the new year.

The first is the EEOC’s annual performance report, which provides a snapshot of how the EEOC views its accomplishments over the last year. These accomplishments, according to the EEOC, include measured gains in three areas of its strategic plan, including strategic law enforcement where the agency claims it secured $347.9 for employees in the private sector through mediation, conciliation, or settlements, and another $52.2 million through agency litigation. Although the report shows the agency well in stride of its goals, it remains to be seen how the incoming administration will affect the EEOC’s agenda.

The second report from the EEOC is its updated enforcement guidance on national origin discrimination, which was last revised in 2002. In announcing the new guidance, the EEOC noted that, in fiscal year 2015, approximately 11 percent of the private sector charges filed with the agency alleged national origin discrimination. As with the old guidance, the new guidance provides information on prohibited employment practices as well as “promising practices” that may minimize the risk of national origin discrimination claims.

Finally, the EEOC issued a resource document that provides information on the rights of job applicants and employees with mental health conditions. Again, in announcing the resource document, the EEOC noted that discrimination claims based on mental health conditions are on the rise and that, in 2016, it resolved almost 5,000 charges based on such conditions. Although the user-friendly resource document is undoubtedly geared toward employees, employers may nonetheless find the information helpful as a reminder of the tricky issues they must navigate in this area of disability discrimination law.

Some Thoughts for Maine Employers on Marijuana Legalization

[The following comments were originally delivered at a breakfast briefing on December 7 in Portland sponsored by Clark Insurance and KMA Human Resources Consulting.]

If we assume that the Question 1 referendum recount does not change the outcome, Maine’s 128th Legislature will begin the process of hammering out a new statutory regime to accompany legalization in 2017.

At the present time, no one can reasonably predict how the post-referendum statute is going to read and whether it is going to provide clear guidance so Maine employers can navigate risk management issues and adequately address legal compliance questions.

It’s a trap to think that here in Maine we can look at how things are being handled in Colorado, for example, and use employers’ experiences there for determining how best to proceed.