Author: Dinse

Kienan D. Christianson, Maggie Platzer, Editors
Dinse, Knapp & McAndrew, P.C., Burlington

by Kienan D. Christianson

When an employer is deciding whether to terminate an employee for poor performance, can it use the fact that she exercised her rights under the Family and Medical Leave Act (FMLA) against her? The U.S. 2nd Circuit Court of Appeals (whose rulings apply to all Vermont employers) answered that question in a recent case, emphasizing that employers must be vigilant about allowing employees to exercise their rights under the FMLA without retaliation or interference.

FMLA basics

The FMLA provides broad protections for employees who need to take time away from work to deal with their own or their family members’ serious health conditions. The purpose of the Act is “to balance the demands of the workplace with the needs of families, to promote the stability and economic security of families, and to promote national interests in preserving family integrity.”

The law “entitle[s] employees to take reasonable leave for medical reasons, for the birth or adoption of a child, and for the care of a child, spouse, or parent who has a serious health condition.” Among other protections, the FMLA provides that “any eligible employee” is entitled to return to “an equivalent position with equivalent benefits, pay, and other . . . employment [conditions].”

If an employer violates the FMLA, either by interfering with an employee’s rights under the Act or retaliating against her for taking leave, the employee has “a private right of action to seek both equitable relief and money damages against the employer (including a public agency) in any Federal or State court of competent jurisdiction.” How can an employee prove she was subjected to an adverse employment action because she exercised her FMLA rights? According to the 2nd Circuit, she need only show that her use of FMLA leave was a motivating factor in the adverse decision. That substantially lowers employees’ burden of proof, making it easier to establish FMLA violations predicated on interference or retaliation.

Facts

The case before the 2nd Circuit centered on a dispute between a nonprofit and a former employee over the reason for her termination. START Treatment and Recovery Centers provides treatment services to patients addicted to narcotics. Cassandra Woods worked as a substance abuse counselor at START for 10 years before her employment was terminated in mid-2012. The reason for her termination was the critical issue in the case. According to START, Woods was terminated because of her poor performance. Woods believed her termination was actually a pretext (excuse) to retaliate for her use of FMLA leave.

As a substance abuse counselor, Woods was required to meet with and counsel patients. In 2011, START implemented a new state-mandated patient note system. Initially, Woods did quite well implementing the new note system, and her 2010 and 2011 performance reviews were generally satisfactory. However, in March 2011, she began falling behind and failed to satisfy START’s job expectations.

START took a series of corrective actions to help Woods meet the goals necessary to succeed as a substance abuse counselor. Although she temporarily met the required outcomes and received a pay raise, she continued to miss her goals and was eventually placed on probation. While she was on probation, she received a number of warnings indicating that she had to meet her performance targets, but she still lagged behind many of her colleagues at the end of her probation. As a result, in May 2012, she was terminated for “fail[ing] to maintain up-to-date patient notes and [an] ‘on-going failure to perform [her] job duties.’”

According to Woods, however, her termination was predicated on more nefarious grounds. Woods suffers from severe anemia and other conditions, and on several occasions, she requested medical leave under the FMLA. She argued that her FMLA leave was the real reason for her termination.

Woods claimed that in early 2011, she approached an HR employee and requested FMLA leave. But shortly after making the request, she canceled it, citing a discussion she had with a coworker who told her to withdraw her request for leave. In the summer of 2011, Woods was hospitalized for six days as a result of her anemia. At the time, START didn’t provide her a full explanation of her FMLA benefits, although it acknowledged that her hospitalization was covered under the Act.

Later in 2011, while she was on probation, Woods again attempted to take FMLA leave, but a START employee allegedly informed her that she wasn’t eligible for leave while she was on probation. Although she needed to be hospitalized for her anemia, she declined a stay at the hospital, fearing she would lose her job if she missed work.

In 2012, shortly before she was terminated, Woods was hospitalized for another seven days. START acknowledged that this hospitalization was also protected under the FMLA. Soon after she returned to work, START decided to fire her, and her termination took place a week later.

As a result of her termination, Woods sued START, arguing it either interfered with her FMLA rights or retaliated against her for exercising her rights. After a trial, the jury returned a verdict in favor of START. Woods appealed, and the 2nd Circuit overturned the jury verdict and sent the matter back to the trial court for a new trial.

Decision by the 2nd Circuit

A number of issues were presented on appeal, but the issue of particular importance for employers was the burden of proof for an FMLA retaliation or interference claim an employee must satisfy to establish the necessary connection between certain adverse actions and her protected rights. START argued that Woods had to prove that her exercise of FMLA rights was the “butfor” cause of her termination. Woods countered that she only needed to show that her FMLA leave was used as a “negative factor” in START’s decision to fire her. The 2nd Circuit agreed with Woods.

In reaching that conclusion, the 2nd Circuit cited a U.S. Department of Labor (DOL) regulation, 29 C.F.R. § 825.220(c), which provides:

The [FMLA’s] prohibition against interference prohibits an employer from discriminating or retaliating against an employee or prospective employee for having exercised or attempted to exercise FMLA rights. For example, if an employee on leave without pay would otherwise be entitled to full benefits (other than health benefits), the same benefits would be required to be provided to an employee on unpaid FMLA leave. By the same token, employers cannot use the taking of FMLA leave as a negative factor in employment actions, such as hiring, promotions or disciplinary actions; nor can FMLA leave be counted under no[-]fault attendance policies.

The court noted that it must defer to properly promulgated agency rules. It then held that “given the sweeping scope of [the FMLA’s] prohibition . . . and the absence of any indication of a causation standard, the [DOL] reasonably construed [the FMLA] to prohibit using the exercise of FMLA rights at all in making employment decisions.” The court concluded that the correct standard for FMLA retaliation claims is whether the employer used the employee’s exercise of her FMLA rights as a “negative factor” in making the adverse decision. Woods v. START Treatment & Recovery Ctrs., Inc., ___ F.3d ___, 2017 WL 3044628 (2d Cir., Jul. 19, 2017).

Significance for employers

There are a couple of important takeaways from the 2nd Circuit’s decision in this case. First, you need to be judicious when responding to employees’ requests for FMLA leave. You cannot use an employee’s performance issues as a pretext for denying her rights or benefits she’s entitled to under the FMLA. Second, if you are contemplating an adverse action against a poorly performing employee, you must ensure that you don’t consider her use of FMLA leave when you make the adverse decision.

For example, if the decision to terminate an employee is a close call and you consider the fact that she took FMLA leave a negative factor that weighs against her, you risk liability for retaliation or interference with her FMLA rights if you terminate her. Careful documentation of the reasons for your termination decision, accompanied by an acknowledgment that the decision was made irrespective of the employee’s use of FMLA leave, can protect your organization against a future claim that you violated her FMLA rights.

Kendall Hoechst, Amy M. McLaughlin, Editors
Dinse, Knapp & McAndrew, P.C., Burlington

by Kendall Hoechst

The National Labor Relations Board (NLRB) is a federal agency vested with the power to prevent and remedy unfair labor practices (ULPs) committed by employers. In the past few years, the NLRB has broadly construed employees’ rights to engage in concerted activities and has struck down many employer policies that tend to “chill” protected conduct in a variety of contexts. A recent NLRB decision upheld by the U.S. 2nd Circuit Court of Appeals (whose rulings apply to all Vermont employers) suggests this trend is continuing.

Section 7 rights generally

Section 7 of the National Labor Relations Act (NLRA) guarantees employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection” as well as the right “to refrain from any or all such activities.” Employers are prohibited under Section 8(a)(1) of the NLRA from interfering with or restraining their employees’ Section 7 rights. In short, if an employer’s policy tends to chill, or dissuade, employees from exercising their Section 7 rights, the employer has committed a ULP under federal law.

Even if an employer’s policy or rule doesn’t explicitly restrict protected activity, the rule is considered a violation if:

1. Employees would reasonably construe the language of the policy to prohibit protected activity;
2. The rule was promulgated in response to union activity; or
3. The rule has been applied to restrict the exercise of protected rights.

The employer’s intent is not always relevant.

In recent years, the NLRB has taken special interest in protecting employees’ Section 7 rights and has been interpreting the NLRA more and more broadly, particularly when it comes to employees engaging in “concerted activities.” A recent NLRB decision upheld by the 2nd Circuit suggests that focus will continue, at least for now.

Whole Foods case

Whole Foods Market maintained rules prohibiting any recording in the workplace—including conversations, phone calls, images, and company meetings—without prior management approval. The rule applied to all areas of every store, to employees and managers alike, and to all electronic devices. Two unions representing Whole Foods employees objected to the rule and filed a ULP charge with the NLRB.

A Whole Foods representative testified that an essential part of the company’s “core values” and “culture” is allowing employees the freedom to speak up and speak out on many issues, work-related or not. Annual regional “town hall” meetings are held without store management present, and the comments, but not the identities of the employees who speak, are later given to management. Whole Foods also periodically holds store meetings and team meetings at which employees voice criticism but are not identified so as not to disrupt team harmony.

Furthermore, Whole Foods suggested that its internal processes for termination decisions and meetings at which employees request assistance with issues involving confidential matters, such as financial need, death or illness in their families, or personal crises, would be adversely affected without the no-recording policy. In other words, in Whole Foods’ view, the policy was designed “to encourage open communication, free exchange of ideas, spontaneous and honest dialogue, and an atmosphere of trust.”

Despite the company’s justifications for its norecording policy, the NLRB found that the rule would reasonably be construed by employees to prohibit them from engaging in Section 7 activity. The NLRB reasoned that photography and recording in the workplace as well as work-related posts on social media are protected by Section 7 if employees are acting in concert for their mutual aid and protection and there is no overriding employer interest against such conduct. Furthermore, in many past NLRB cases, photographs or recordings, often made covertly, were an essential element in vindicating the underlying Section 7 right.

The 2nd Circuit upheld the NLRB’s decision, agreeing that Whole Foods’ rule was overly broad. For example, the rule could prevent employees from recording images of picketing or from documenting unsafe workplace conditions without management approval. The court held that the language of the policy could chill employees’ exercise of their Section 7 rights because the rule, as written, wasn’t limited to controlling activities in which employees don’t act in concert.

What does this mean for Vermont employers?

Employers should review any policies that address employees recording activity in the workplace or posting work-related content on social media and consider whether they are open to a broad interpretation along the same lines as Whole Foods’ policy. It doesn’t matter what the potentially good intentions behind the policy are.

The 2nd Circuit noted that not every no-recording policy will infringe on employees’ Section 7 rights, explaining that it should be possible to craft a policy that places some limits on workplace recording that doesn’t violate the NLRA. The court didn’t provide more specific guidance than that general assertion, but it suggested that concerns about patient privacy in a hospital setting or safety policies for reporting unknown visitors could fit the bill.

While it’s possible that the Trump administration may set the pendulum swinging in the opposite direction, the future of NLRB enforcement is uncertain. For now, employers should continue to be wary of implementing or maintaining any policy that, broadly construed, could be seen as chilling employees’ Section 7 rights. The Whole Foods decision signals that the NLRB’s trend of broadly interpreting workplace policies is continuing.

Kendall Hoechst can be reached at khoechst@dinse.com or 802- 859-7042.

Karen McAndrew, Leigh Cole, Editors
Dinse, Knapp & McAndrew, P.C., Burlington

by Karen McAndrew

Sometimes it’s difficult to tell whether the court is talking about employment law or just old-fashioned “premises liability,” but in the end, that apparently doesn’t make a great deal of difference when it comes to your obligation to provide safe workplace premises. And, as a recent Vermont Supreme Court case shows, you’d better not instruct or invite someone to do something that is just plain dangerous even when the danger is open and obvious to the dude who’s about to do it.

Facts

Hector LeClair, who had experience in the construction business, owned a building in need of a new roof. He asked his son, Ricky, who was also in construction, about replacing the roof. Ricky in turn asked his son, Joseph, who was an unemployed roofer at the time, if he was interested in the job, saying it would be “good money.” Joseph took on the job, and Ricky delivered the materials and equipment to the jobsite. Joseph later alleged, however, that his grandfather, not his father, told him what to do.

Several days after having removed the old shingles, Joseph showed up on an October morning to find that an early frost covered the exposed underlayment. He saw the obvious danger and decided he shouldn’t work on the slippery roof. He claimed later, however, that his grandfather told him to get to work. Joseph then climbed a ladder to a porch roof, and from there began to climb on the second story roof when he slipped and fell to the ground, suffering serious and permanent injuries to his head and back. He then sued his grandfather.

Grandfather’s responsibility?

The trial court dismissed Joseph’s complaint without a trial, holding that Hector owed no duty to protect someone on his property from a known and obvious danger. At the last minute, Joseph tried to amend his complaint to allege that his grandfather was really his employer, and because Hector didn’t have workers’ compensation insurance, Joseph didn’t have to prove his grandfather’s negligence in order to recover for a workplace injury. He also wanted to include a “common law claim” that, as his employer, Hector had an obligation to provide him with a safe workplace. His grandfather opposed this attempt on a variety of grounds, among them the late-in-the-day filing of it. The trial court didn’t allow the amendment, so the case proceeded to the Vermont Supreme Court.

Over the strenuous dissent of two members of the court, the majority managed to find a means by which Joseph’s case could proceed to trial. Most of the ink was spilled on the “premises liability” issue, not the employment claim, but there is considerable overlap, and particularly if you own your workplace premises, the decision deserves some attention.

Traditionally, the law made distinctions among categories of visitors—employees, “business invitees,” “licensees,” and trespassers—and the duty owed to a person coming on the premises depended on the category into which that person fell. Distinctions among employees, business invitees, and other visitors have now largely disappeared, however—and even some trespassers may now be owed some measure of care if the property owner has reason to know that trespassers are likely to come onto the premises and encounter danger. In general, the duty is to protect against or warn visitors of latent or hidden dangerous conditions on the premises.

Until now, however, there has not been a duty to warn of open, obvious dangers. And in general, a visitor who voluntarily assumes the risk of an open and obvious danger has no claim against the landowner for injuries that result from that activity. (It was largely those principles that drove the dissent to argue that Joseph shouldn’t recover for climbing onto the roof that he knew was slippery.) So how does all of that play out among the LeClairs?

Court’s decision

Because Hector hadn’t claimed that Joseph “assumed the risk” of climbing on the icy roof—concentrating instead on the question of whether he owed any duty to him in the first place—the supreme court also turned its attention to the question of whether there was a duty to protect against or warn Joseph about the slippery roof. The answer would appear to be obvious, as Joseph had admitted that he observed the condition, knew it was dangerous, and decided to “risk it,” after first having decided it was a bad idea.

However, the court pounced on an exception to the general rule, which notes that there are cases in which the owner or possessor of land “should anticipate that the dangerous condition will cause physical harm . . . notwithstanding its known or obvious danger” or has reason to understand that the visitor will “fail to protect themselves against” the danger. That exception prompted the court to focus on the testimony from Joseph that Hector ordered him to get to work, despite the frosty condition of the roof. The court posited that a worker in that situation might feel compelled to do the work despite the danger or risk losing his job. And that was enough for the court to send the case back to the trial court for a jury to determine whether Hector did in fact order Joseph to work on the icy roof and, if so, whether he should have anticipated that his grandson would be injured.

The court then went on to consider whether to add— when the case got back to the trial court—Joseph’s claim that his grandfather was his “employer” and whether Hector had an obligation under the circumstances to provide him with a safe place to work. That duty has now been established in a statute, but because the statute doesn’t provide an employee a basis to assert a claim against the employer, Joseph had to rely on the duty that developed under the common law.

Hector argued that he wasn’t Joseph’s employer because Ricky had engaged him to do the work and supplied the materials and equipment. Joseph argued, on the other hand, that his grandfather was the one who “controlled” the work, was present on the premises, and ordered him to get to work.

Although the definition of “employer” under Vermont’s workers’ comp statute is broader than this, the court agreed that, for these purposes, the “right to control” is the essential determinant of who is an employer but noted that can’t be true where the “proposed employee” has specialized knowledge that the “proposed employer” doesn’t have. Where that is the case, other factors become relevant, such as who supplies the tools and equipment, whether the work is “by time or by job,” whether the work is part of the regular business of the employer, and so on.

In this case, the court said that because there were so many conflicting facts and allegations, a jury should have been allowed to sort them out, so it sent the case back for trial on Joseph’s original complaint as well as his amendment.

And the moral is?

Is there at least something employers can learn from this? Perhaps.

First, to state the fairly obvious, it’s not a good idea to instruct, or even ask, anyone working on your premises— employee, independent contractor, or otherwise— to engage in something that is obviously dangerous, even if you think the danger should be understood by the worker.

And second, it’s not as easy as defining your duties to provide safe working conditions by whom you consider to be your employees. Don’t assume that because an independent contractor is working on your premises that you have no duty to provide a reasonably safe place to work or to warn of hidden or latent defects.

Faced with a complaint, employers tend to say, “They were making it up.” But that’s not usually the case; the employee generally has a “good-faith belief” that he is right. And that’s all that’s required legally. The complainer doesn’t have to be right about the complaint.

Cultivate culture of criticism that leads to loyalty

Employers already understand the need for policies that don’t merely prohibit discrimination but also prohibit retaliation and the adverse treatment of whistleblowers. But it isn’t enough to just inform workers that they are protected from retaliation. Instead, companies should create a culture that supports internal criticism across the spectrum of issues, large and small. Whistleblowing can either increase cooperation and reduce selfishness within the group or increase dissent and denigration. The difference comes down to group culture.

Organizations looking to reduce the threat of retaliation lawsuits should consider creating a culture that welcomes criticism. The thought is that if you encourage employees to blow the whistle internally and your company views dissent as a good thing (i.e., it makes the company better), loyalty is enhanced, and whistleblowing to an outside entity such as the EEOC becomes less likely.

Part of that effort should include strong, well-publicized policies that encourage internal reporting of potential violations or wrongdoing. But it should also include training supervisors on how to welcome criticism and avoid retaliation toward subordinates who speak up, in addition to conveying other messages that highlight the value of internal constructive criticism.

Make whistleblowing ‘less noble, more normal’

If an employee’s whistleblower or retaliation claim heads to court, you might benefit from evaluating your complex feelings toward the whistleblower. You may not want to explicitly play the loyalty card because blaming the employee for breaking ranks may seem to reinforce his argument that your company had a retaliatory motive. Instead, seek to normalize the act of whistleblowing.

If your company has embraced a culture of criticism, you should be able to point to several features of your policies and culture that don’t just allow whistleblowing but positively encourage it. The ability to prove that such a culture exists permits you to suggest that whistleblowing isn’t a uniquely noble act on the employee’s part but instead is something you expect of all your employees. The fact that a claim was made means you need to take it seriously, but it doesn’t mean you retaliated against the employee.

Ultimately, the complexity of our views of whistleblowers is a reminder that employment decisions and court cases aren’t just about claims, evidence, and the law. They are also about perceptions and a story and how each of the parties fits within that story’s moral frame.

Questions your company should ask

Finally, ask yourselves these questions:

• Are we clear and honest about what we want?
• Are we encouraging “dissensus”? (When discussion, criticism, and reporting are part of your job and part of your culture, it’s harder to get worked up.)
• Is whistleblowing normalized?
• Are we aiming to keep it nonpersonal?
• Are we consistent?
• Do we follow through? (Employees need to see that the complaint process is followed).
• Do we publish outcomes (“We investigated and corrected” or “we found no violation but see the need for more training.”)
• Do we properly implement whistleblower discipline? (Yes, you can impose discipline on someone who is a whistleblower, but only with care.)

Karen McAndrew can be reached at kmcandrew@dinse.com or 802-864-5751.