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Employer Error in Advising Employee of Eligibility for FMLA Leave Can Have Enduring Consequences

On January 27, 2015 by Schnader in Labor and Employment

By Scott J. Wenner

The Family and Medical Leave Act does not require all employers to grant leave to all employees. One condition for eligibility requires an employee to work at, or within 75 miles of, a site at which the employer employs at least 50 employees. And while it is unlawful for an employer to interfere with or retaliate against an employee for the exercise of FMLA rights, an employee who is ineligible for FMLA leave logically cannot make such a claim. A recent opinion of the Court of Appeals for the Sixth Circuit is a reminder that careless action by an employer can result in an ineligible employee having the right to claim interference with or retaliation for exercising FMLA rights.

In Tilley v. Kalamazoo County Road Commission, the employer sent Terry Tilley a letter stating that he was eligible for FMLA leave, together with a “Notice of Eligibility and Rights & Responsibilities” that also stated he was FMLA-eligible. Three days later, the employer discharged Tilley for absence. Tilley filed a lawsuit alleging age discrimination and interference and retaliation under the FMLA. The district court granted the employer’s motion for summary judgment, finding a lack of evidence to support the age claim and holding that Tilley in fact was ineligible for FMLA leave because he did not work within 75 miles of a road commission site having 50 employees.

While it affirmed the dismissal of Tilley’s age discrimination claim, the Sixth Circuit reversed the summary dismissal of his FMLA interference and retaliation claims. Even though it recognized that Tilley was in fact ineligible for FMLA leave, the court held that the employer was equitably estopped from raising ineligibility as a defense because it had sent Tilley documentation denoting him as FMLA-eligible. In other words, even though Tilley was not entitled to FMLA leave as the statute defines eligibility, the court treated him as if he were eligible and refused to entertain his ineligibility as a defense.

The court held that to support a claim of equitable estoppel, the employee has to show only (1) a definite misrepresentation as to a material fact, (2) reasonable reliance on the misrepresentation, and (3) resulting detriment. The panel found that Tilley presented sufficient evidence on all three elements to withstand summary judgment.

Lessons Learned

Perhaps surprisingly, the Sixth Circuit’s Tilley decision hardly stands alone. At least four other circuits have approved application of equitable estoppel to FMLA cases where employees have relied on employer misstatements on eligibility for FMLA leave. Reed v. Lear Corp., 556 F.3d 674, 678 (8th Cir. 2009); Minard v. ITC Deltacom Communications, Inc., 447 F.3d 352, 358-59 (5th Cir. 2006); Woodford v. Community Action of Greene County, Inc., 268 F.3d 51, 57 (2d Cir. 2001); Dormeyer v. Comerica Bank-Illinois, 223 F.3d 579, 582 (7th Cir. 2000). (The Third Circuit also found it was appropriately used in a non-precedential decision: Leese v. Adelphoi Village, 12-2834 (3rd Cir. 2013))

The lesson for employers is clear: be prepared to live with any mistake made when informing an employee of eligibility for FMLA leave, and ensure that managers, supervisors and HR personnel are instructed not to retaliate against any employee for using FMLA leave that was granted in error. Indeed, it would be prudent to consult employment counsel before acting on any mistake uncovered in advising employees of their eligibility for FMLA leave.