Author: Maria Danaher

The Pregnancy Discrimination Act (PDA) was enacted in 1978 and specifically prohibits employment discrimination based on an employee’s pregnancy. The PDA requires equal treatment of women “affected by pregnancy, childbirth, or related medical conditions” in all aspects of employment, including hiring, promotion, employment termination, and the receipt of fringe benefits.

The PDA bars employers from treating women who are pregnant or are affected by pregnancy-related medical conditions differently from those who are similarly able or unable to work. The Act requires employers to treat employees who are on pregnancy leave the same way that employees on leave for other medical reasons are treated.

If a company’s medical leave policy grants certain benefits to employees on other medical leave, the policy must also grant such benefits to women on leave for pregnancy.

Overlap Between the PDA and the FMLA
The PDA applies to employers with 15 or more employees. Such employers must comply with the provisions of the law in non-discriminatorily applying medical leave procedures to maternity leave requests.

In addition, employers may be required to provide 12 weeks of unpaid leave during a 12-month period for eligible employees under the Family and Medical Leave Act (FMLA). (Companies that receive requests for pregnancy-related leave should be aware that the FMLA applies only to employers with 50 or more employees within a 75-mile radius. Employers with less than the requisite number of employees are not bound by the provisions of the FMLA.)

Employers should review medical-leave policies to assure that maternity-leave policies are written to run concurrently with applicable FMLA leave. If policies are written nebulously, an eligible employee may have a valid argument for taking FMLA leave in addition to any allowable maternity leave.

Employers are becoming increasingly aware of the fact that the conflict between the extensive and often confusing FMLA policy concerns and typical medical-leave policies can lead to administrative headaches in dealing with requests for leave by pregnant employees.

For instance, the FMLA requires that an individual’s job remain available while the employee is on leave. However, an employer may decide to eliminate positions while an employee is on a pregnancy-related leave, which may necessitate lay-off or termination of the employee while on leave. The U.S. Court of Appeals for the 11th Circuit addressed that issue when an account executive sued her employer under those very circumstances.

In that case, Debra Lee O’Connor took a 12-week maternity/FMLA leave with her employer’s approval. During her absence, the employer laid off nearly 200 workers because of a financial downturn. Upon finding that her job had been eliminated, O’Connor sued her employer, claiming that she was entitled to FMLA reinstatement.

The Court disagreed, holding that O’Connor had no greater right to reinstatement than if she had been continuously employed during her FMLA leave period. The fact that her leave was pregnancy-related did not change the outcome of the case. The determinative factor in the case was the company’s ability to support its argument that O’Connor’s layoff was due to financial concerns for which the company could show evidence, and the fact that O’Connor would have been among the nearly 200 laid-off employees even if she had not taken her maternity leave.

Liability for Failure to Hire
The PDA addresses the stereotype that women are less desirable employees because they are liable to become pregnant. An employer cannot fail to hire an individual simply because it anticipates that the woman might be unable to fulfill job expectations, or because it assumes that the woman will be absent from work for some period because of her pregnancy.

The U.S. Court of Appeals for the 4th Circuit upheld a jury’s verdict and an award of punitive damages against an employer, based on evidence that the employer decided not to hire an individual because the woman was six months pregnant. In that case, Sarah Wagner applied for a sales-clerk position and was offered the job during an interview at Dillard Department Stores. However, the offer was later withdrawn when Wagner told the company’s HR representative that she would need to arrange her work schedule around weekly doctor appointments because of her pregnancy.

Although the company argued that it had never offered Wagner a sales position and that it did not hire her due to a hiring freeze, the evidence at the trial indicated that the hiring freeze was not instituted until sometime after Wagner’s interview. The jury learned that Dillard Department Stores hired 22 sales associates, none of whom were pregnant, between the date that Wagner applied for employment and the date that the company-wide hiring freeze began, and that 12 of those employees were hired after Wagner’s interview.

Dillard argued that even if Wagner’s testimony was accepted as true, the employment offer was withdrawn only because of Wagner’s inability to work regular hours and her need to take a leave from employment soon after she was to begin working. Dillard asserted that it is not illegal to dismiss an employee for absences or tardiness due to pregnancy, as long as such absences or tardiness are not overlooked in non-pregnant employees.

However, the Court determined that Dillard’s argument amounted to a “post hoc fictitious assertion” and that the company made an unsupported (and, ultimately, illegal) assumption that Wagner would not be able to do her job based on pregnancy-related medical issues.

The message in this case is that employers should not make stereotypical assumptions regarding whether a pregnant applicant will be able to fulfill the functions of the position for which she is applying. Obviously, a woman’s ability to fulfill a job will vary from individual to individual. Without evidence or information that the applicant is unable to do the job, an employer cannot base its failure to hire an applicant on assumptions regarding her pregnant condition.

 Denial of Promotions
Employers should be cognizant of the fact that an employee’s prior pregnancy, pregnancy-related leave, or pregnancy-related legal action cannot be viewed as a legitimate factor on which to base a promotional decision. The U.S. Court of Appeals for the 9th Circuit addressed that issue recently, determining that the failure to promote a woman to a supervisory position could be viewed as a violation of the PDA when evidence existed that such failure was in retaliation for a pending pregnancy discrimination claim.

Elizabeth Bergene worked as a journeyman electrician at the Salt River Project’s Coronado Generating Station in Arizona. In 1990, she filed a pregnancy discrimination claim. After her husband was fired from a temporary job with Salt River Project in 1994, Bergene filed a second lawsuit, alleging that the firing constituted unlawful retaliation for the earlier pregnancy claim.

In November 1995, at about the time that Bergene began settlement discussions with Salt River Project regarding her 1994 lawsuit, Salt River Project advertised an open position for electrical foreman. As a journeyman electrician with substantial experience, Bergene met the qualifications and applied for the position.

In the following month, Bergene’s former supervisor told her that she would not get the foreman position if she held out for too much money in the settlement of her pregnancy/retaliation claim. At or about that same time, Salt River changed the requirements for the foreman position, removing the journeyman electrician requirement and adding the requirement of supervisory experience, of which Bergene had little. The Salt River Project then chose a male applicant for the position who qualified only under the new requirements, and who had no journeyman experience.

Bergene subsequently left her position on a work-related stress leave and did not return. She then filed an EEOC claim and, ultimately, a lawsuit, alleging that Salt River Project denied her promotion to electrical foreman in retaliation for filing her earlier pregnancy-related claims. The lower court dismissed Bergene’s claims, ruling that Salt River Project provided non-discriminatory reasons for its failure to promote Bergene. However, on appeal, the Ninth Circuit overturned that decision.

Although Salt River Project argued that Bergene failed to show that the company’s action was retaliatory, the Ninth Circuit disagreed. The threat made to Bergene that she would not be promoted if she held out for a large settlement on her earlier pregnancy-related claim was interpreted by the Court as an inference of retaliation. The Court held that such evidence of a direct threat of adverse employment consequences if Bergene vigorously pursued her earlier claim was sufficient to infer that the company’s proffered reason for the non-promotion was pretextual, and that the real reason was retaliatory.

Further, evidence was presented that Bergene’s supervisor had stated that he had heard that she was “trouble.” Viewed in the context of the earlier pregnancy-related claim, the remark was viewed as additional circumstantial evidence supporting Bergene’s claim of retaliation.

When evaluating candidates for promotion, employers must not view pregnancy-related leaves, claims, or other issues as negative factors in the decision-making process. Objective, job-related qualifications, consistently applied, will help to avoid legal liability for claims made under the PDA.

Termination of Employment
The PDA prohibits an employer from terminating an employee because of pregnancy, childbirth, or related medical conditions. However, the law does not prohibit employers from making termination decisions based on legitimate, well-documented job-related reasons. The U.S. Court of Appeals for the 7th Circuit underscored that point in a decision in which it upheld summary judgment for an employer who was able to provide documentation and evidence substantiating a pregnant employee’s failure to meet job expectations.

In 1992, Holy Cross Hospital created a Neighborhood Affiliate Network of primary care physicians to practice in the surrounding communities. The plan included subsidy of the Network by guaranteeing salaries to participating physicians until the practices matured into profitable enterprises. The Network’s physicians were expected to built profitable practices with the end-goal of financial independence.

Dr. Pamela Clay was hired in 1996 to build a pediatric practice for the Network. Clay became pregnant in late October 1997, but did not disclose her pregnancy to the hospital’s administration until May 1998. By early 1998, when the Network continued to require subsidy by the Hospital, the decision was made to eliminate certain Network practices. Each practice was assessed using a variety of factors, including the physician’s willingness to market his or her own practice, and the likelihood of that practice’s growth. The Hospital created a list of physicians that who were perceived to be less likely than others to “grow their practices” to profitability. Clay was among the physicians on that list.

The hospital’s administrators testified that Clay would be unable to achieve a financially self-sufficient practice because she was uncooperative with the hospital’s marketing efforts and was, in addition, not accessible to patients, as she was unwilling to see patients outside of her scheduled office time and would turn away patients who were waiting in her office at the end of her scheduled hours.

After the announcement of her termination from the Network, Clay sued the hospital, claiming that she was terminated because of her pregnancy, in violation of the PDA. The hospital moved for summary judgment largely on the basis that Clay could not show that the hospital’s reason for the termination of her employment (Clay’s inability to produce a profitable practice) was a pretext for discrimination.

The hospital’s stated reason for the termination of Clay’s participation in the Network was that the hospital believed that Clay had a generally uncooperative attitude, based on her unwillingness to participate in marketing activities, her reluctance to cover for other physicians, and her inability to increase the growth and revenue of her practice. Clay was unable to rebut the hospital’s assertion and documentation that her practice was unprofitable, or to point to any efforts on her part to change that fact.

The Seventh Circuit held that, because Clay failed to demonstrate that the hospital’s proffered reason for her termination was a pretext for intentional discrimination, Clay was unable to go forward with her claim under the PDA. The Court’s decision was based primarily upon the well-documented criteria used by the Hospital as the basis of its termination decision.

Dos and Don’ts
There are a number of obvious “minefields” related to employment-related decisions under the PDA that can be summarized as follows:

Hiring:

• Avoid questions regarding number of children, intentions to have children, or child care arrangements.

  
  

• Do not make assumptions related to the physical capabilities of a pregnant applicant.

  
  

Performance Evaluations/Promotion Decisions:

• Performance evaluations should be based solely on job-related factors; a pregnancy-related issue cannot form the basis of a negative evaluation or a decision not to promote.

  
  

• Do not refer to an employee’s protected status, even as a simple reference, in evaluating the individual’s performance. Such reference may create an inference that the status was considered as a factor in the evaluation or promotion decision.

  
  

• Do not allow an evaluator’s personal feelings regarding an individual’s pregnancy-related issue affect the evaluation or promotion decision.

  
  

Discipline/Termination:

• Inconsistent application of policies that negatively affect a pregnant employee can form the basis of legal liability under the PDA; ensure uniform and consistent application of all policies and procedures.

  
  

• Policies that adversely affect pregnant employees, even inadvertently, may lead to liability, including punitive damages against the employer.

  
  

Conclusion
Employers faced with the possibility of making decisions that affect the hiring, advancement, or termination of the employment of individuals with pregnancy-related issues should act in accordance with the rationales set forth in the cases cited in this article, and should ensure that such decisions are based on legitimate, business-related criteria, well-supported by documentation or other evidence.

The obvious consequences of violation of the PDA include lost wages and benefits, front pay, compensation for emotional distress, attorney fees, and potential punitive damages. Taking administrative precautions to effectively and consistently implement appropriate policies and procedures can help to avoid such damages.

The information contained here is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion.

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neof the DOL’s FMLA regulations, 29 C.F.R. §825.208, requires employers to alertemployees when an absence is being counted as FMLA leave, to provide that alertprior to the commencement of the leave, and states that only after thisnotification has been provided may an employer begin counting an employers daysoff as applying against the 12-week entitlement. 

   The regulation states that, “In all circumstances, it is the employer’sresponsibility to designate leave, paid or unpaid, as FMLA-qualifying, and togive notice of the designation to the employee as provided in thissection.” 

   It is significant that the regulation places the responsibility on the employerto designate that requested leave qualifies under the FMLA. If an employer failsto give prior notice that an absence will be counted as FMLA leave, theregulations says that the time off simply does not count against the employee’s12-week FMLA entitlement. If an employer fails to notify employees that time offis considered FMLA leave, than that employer is then obligated to allow 12 weeksof FMLA leave in addition to any other leave provided. 

   The courts do not necessarily agree with the DOL on this point. In McGregorv. Autozone, Inc., 180 F.3d 1305 (11th Cir. 1999), the 11th U.S. CircuitCourt of Appeals – with federal jurisdiction over Alabama, Florida and Georgia -struck down that regulation for employers within these states, declaring theregulation to be “invalid and unenforceable,” because it placesburdens on employers that are beyond those set forth by the FMLA statute. 

   In McGregor, an employee returned from a 15-week leave, learned that herformer position was no longer available to her, and then sued her employer forviolations of the FMLA. Referencing the language of the regulation, she claimedthat she was entitled to 13 weeks of employer-provided paid disability leave andthen up to 12 weeks of unpaid FMLA leave. She based her suit on the fact thather employer failed to notify her, prior to her absence, that the two leavesmust run concurrently as FMLA leave. 

   The 11th Circuit rejected the DOL regulation and stated that the employee did nothave the right, under the FMLA, to be restored to her prior position, becauseshe had been absent for more than the statutorily protected amount of time (12weeks). In upholding summary judgment in favor of the employer, the Court didnot permit the DOL’s regulation to create an entitlement to an extra 12 weeks ofmedical leave to the employee. 

   The 8th U.S. Circuit Court of Appeals – which has jurisdiction over federalmatters in Arkansas, Iowa, Minnesota, Nebraska, and North and SouthDakota–recently became the second federal appellate-level court to declareunenforceability of the DOL’s regulation. 

   In Ragsdale v. Wolverine Worldwide, Inc., 218 F.3d 933 (8th Cir. 2000),the employee asked for and was provided medical leave so that she could receivecancer treatment. Before she took her leave, her employer did not specificallydesignate any part of her time off as FMLA leave. The company had a policystating that employees requiring time off for a medical condition were entitledto seven months of leave. When the employee was unable to return to work afterseven months, her employment was terminated based on company policy. 

   Upon learning of the termination, she asked for twelve additional weeks of leaveunder the FMLA. When the employer denied her request, she sued the company forviolating the FMLA. A federal district court granted summary judgment in favorof the employer, which the employee then appealed. 

   On appeal, the 8th Circuit upheld judgment in favor of the employee, statingthat the DOL regulation improperly expanded the FMLA’s guaranteed minimum leavetime into an unearned “entitlement” of 12 extra weeks of leave.Further, the Court stated that 12 weeks of leave is both the minimum and maximumamount of leave that am employer is required to provide under the FMLA. 

Nota trap for employers
   These cases aside, the courts have not invalidated every DOL regulationrequiring employers to designate leave as FMLA-related. In fact, the courts haveruled that there may be circumstances under which an employer’s failure toprovide advance notice of FMLA might deny an employee intended to mandate a minimum of 12 weeks of leave for employees, andthat Congress, “did not intend to construct a trap for unwary employers whoalready provide for twelve or more weeks of leave for their employees.” 

   It’s also important for employers to note that one federal appellate court hasmade decisions that are in direct conflict to those reached by the 8th and 11thCircuits.  In Plant v. MortonInternational, Inc., 212 F.3d 929 (6th Cir. 2000), the 6th Circuit,encompassing federal courts in Ohio, Tennessee, Michigan and Kentucky, upheldthe DOL’s guidelines stipulating that employers are legally obligated to notifyemployees in advance of the leave if that leave is to be designated under theFMLA. The Court based its decision on the fact that the FMLA itself is silentregarding the issue of advance notice. 

   The 6th Circuit ruled that public policy is better served by requiring employers toprovide ample notice to employees of their rights under the statute. However,the 6th Circuit stands alone, to date, in this position. 

Theinformation contained in this article is intended to provide useful informationon the topic covered, but should not be construed as legal advice or a legalopinion. Also remember that state laws may differ from the federal law.

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hecourts have also invalidated DOL regulation 29 C.F.R. §825.110, which statesthat “if an employer fails to advise an employee whether the employee iseligible [for leave under the Act] prior to the date the requested leave is tocommence, the employee will be deemed eligible [for FMLA leave].” 

   The 7th Circuit Court of Appeal – covering Illinois, Indiana and Wisconsin – was thefirst to strike down the regulation.  InDormeyer v. Comerica Bank-Illinois, 222 F.3d 579 (7th Cir. 2000), anemployee was deemed ineligible for FMLA leave because she had not worked for1,250 hours during the twelve months prior to her leave. 

   After working as a bank teller for less than two years, the employee was firedfor excessive absenteeism. The employee had been warned repeatedly and counseledregarding her absenteeism. Shortly before she was terminated by her employer,the employee became pregnant and requested FMLA leave, citing morning sickness.The bank’s lack of response to her request formed the basis of the employee’sFMLA claim. Though the employee recognized that she had not worked the required1,250 hours required by the Act, she used the DOL regulation to argue that theBank’s failure to respond to her request made her eligible to receive 12 weeksof leave. 

   The trial court dismissed the employees’ claim and the 7th Circuit upheld thedismissal. The 7th Circuit held that the DOL’s authority to provide guidance for interpretation ofthe FMLA and to issue regulations does not mean that the agency can alterthe language and meaning of the Act.  Thelanguage of the FMLA clearly states that only employees who have worked for1,250 hours in the previous twelve months are eligible for leave. The Court thenutilized a hypothetical situation that could result in situation where “anemployee who had worked for eight hours before seeking family leave would beentitled to family leave if the employer neglected to inform the employeepromptly that he or she was ineligible.” 

   The 11th Circuit Court became the second federal appellate court to strike down the DOLregulatory guidance that creates automatic FMLA eligibility for any employee whohas not, prior to leave beginning, been alerted by his or her employer regardingFMLA eligibility. In Brungart v. BellSouth Telecommunications, Inc., No.99-14472 (11th Cir. October 24, 2000), the employee, who had first startedworking for her employee in 1991, began unpaid, non-FMLA leave on December 1,1994. The leave extended until September 1, 1996. On December 2, 1996, theemployee submitted a request for FMLA leave so that she could care for herailing mother and took her leave effective that same day. 

   She was absent for more than ten days December 2, 1996. However, it was notuntil nearly six weeks later when she was advised that she was ineligible forFMLA leave because she had not worked 1,250 hours in the prior 12 months. She inturn sued her employer for violations under the FMLA, saying that they theemployer had failed to inform her in a timely manner that her request for leavehad been denied. The lower court soon dismissed the claim, and the 11th Circuitaffirmed, in language strongly critical of the DOL. 

   The court determined that when an administrative agency seeks to”improve” legislation by altering the basic provisions of the law, ithas “gone too far.”  TheCourt also stated that the DOL had, “attempted to pry apart the clear wordsof the act in order to create a gap into which it can wedge its policypreference.” 

Theinformation contained in this article is intended to provide useful informationon the topic covered, but should not be construed as legal advice or a legalopinion. Also remember that state laws may differ from the federal law.

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irst,a brief overview of the law.

Whenthe FMLA applies

   Any company or organizations with 50 or more employees within a 75-mile radiusis subject to the provisions of the Family and Medical Leave Act (FMLA). TheFMLA provides eligible employees with up to 12 weeks of unpaid leave during a12-month period so that employees can attend to serious medical conditions, beavailable for the births or child adoptions, or to care for a parent, spouse orchild who requires serious medial attention.

   It is important to note that not all employees are eligible for FMLAleave. For example, only employees who have worked for a company for at least 12months, and have worked for at least 1,250 hours with that employer during theprevious 12-month period, may request leave.

   An important provision of the FMLA is that it guarantees that — after takingFMLA leave — an employee will be able to return to his or her position, or anequivalent one. Also significant is that FMLA may be taken intermittently,instead of all at once, in some circumstances.

   These issues present a real challenge to employers who must determine when leaveis appropriate. Intermittent leave may, for example, make it more difficult foran employer to track employee attendance and enforce disciplinary measures ifabuse is suspected.

   In order to appropriately assess whether an absence is FMLA-related, HR musttake steps to understand the reasons for an employee’s medically-relatedabsence. The issue becomes increasingly complicated if the “serious healthcondition” that is the basis for the leave evolves into a disability. Underthose circumstance, an employer may be required, under the Americans withDisabilities Act (ADA) to provide, as an accommodation, time off in excess ofthe 12-week FMLA leave. The question then becomes whether or not the leaverequested presents an undue hardship to the company.

DOLregulations and the FMLA

   The Department of Labor (DOL) issues “guidelines” to employers on howto properly comply with FMLA. Though these guidelines do not have the force oflaw, they are generally referenced by courts interpreting and enforcing thatAct.  However, a number of recentlegal decisions have criticized the DOL for issuing guidelines that revise theotherwise clear language of the FMLA and that, in effect, extend theentitlements granted under the FMLA.

   The regulations addressed by federal appeals courts both deal with employersnotifying employees once the employees have requested leave. The firstregulation automatically entitles employees to 12 additional weeks of leave iftheir employer fails to designate requested leave as FMLA leave. The secondregulation entitles any employee who requests leave and is not informedof ineligibility for FMLA leave to automatic eligibility under the FMLA.

Theinformation contained in this article is intended to provide useful informationon the topic covered, but should not be construed as legal advice or a legalopinion. Also remember that state laws may differ from the federal law.

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mployersshould not be tempted to disregard the DOL’s guidances and regulations,especially since the courts rely upon these guidances to help interpret the FMLA.

   Theyshould instead remember that the regulations do not have the power to change oramend the existing language of the Act. This is important because many of theDOL’s regulations remain unchallenged, rendering them viable and instructive. Further, many DOL regulations have withstoodchallenges in court. The regulations include three actions that employers arespecifically  permitted to take when reviewing leave requests:

1.  Medical certification may be requested. Claims of “seriousmedical conditions” must be documented and certified. The certificationshould include relevant medical facts that support the health care provider’sdesignation of the condition as “serious” for purposes of the FMLA.

2.  Second and third opinions are permissible. If employers havereason to doubt a medical certification, they may require employees to getsecond and even third opinions, at the employer’s expense. The health careprovider who will offer the second opinion may be designated by the employer solong as the provider is not employed in the company’s medical department. Untilthe second opinion is provided, the employee is provisionally entitled tobenefits under the FMLA.

3.  Requests for recertification are permitted. If there is a chronicor long-term medical condition, if absences change significantly, or there isreason to doubt the employee’s stated reasons for leave, an employer may requesta re-certification. However, second or third opinions on re-certification arenot permissible. 

   Notonly are these actions prudent, but may support an employer’s defense in an FMLAmatter. 3d U.S. District Court of Appeals, in fact, specifically cited anemployer’s failure to take these actions as an inadequacy in the administrationof an employee’s request for FMLA leave. In Victorelli v. Shadyside Hospital,128 F.3d 184 (3d Cir. 1997). In that case, the Circuit Court, which coversPennsylvania, New Jersey, Delaware, and the Virgin Islands, chided the Hospitalfor not taking the actions that were clearly available, as doing so might havehelped the hospital deliver a prompt and appropriate determination regarding anemployee’s request for FMLA leave. 

Whatemployers should do
   Ifan employee requests a medical leave, it is imperative that to review therequest carefully, and to examine all supporting information and documentation,in order to determine all obligations under the FMLA. Because the provisions ofthe Act are complex, it helps to approach each request carefully, taking care torequire medical certification, get additional medical opinions and requirere-certification for chronic illnesses. It is also important to apply theprocedures uniformly to all requests so that it is clear to your employees thatthere is a procedure for processing FMLA requests. 

   Institutingthese precautions helps to effectively verify and respond promptly to requests,and should help to prevent FMLA violation claims. Further, by attending torequests immediately, employees can be provided with accurate informationregarding their eligibility and the appropriateness of their requests. Failureto act quickly and in accordance with DOL regulations leaves employers at riskof costly and time-consuming lawsuits, and the attendant business disruption anddamages that may result. 

Theinformation contained in this article is intended to provide useful informationon the topic covered, but should not be construed as legal advice or a legalopinion. Also remember that state laws may differ from the federal law.

The Fair Labor standards Act (FLSA) establishes minimum wage, overtime pay, child labor standards, and record keeping procedures, and applies to employees in both the public and private sectors.

While the Act regulates basic minimum wage, overtime pay, and the employment of minors, there are certain employment practices not affected by the FLSA. These include: vacation, holiday, severance, or sick pay; premium pay for holidays or weekends; and fringe benefits.

The most widely recognizable provision of the FLSA is its overtime provision. Generally, employers are required to pay overtime pay at a rate of not less than 1.5 times an employee’s regular hourly rate after an employee works 40 hours in a workweek. The provision protects all “nonexempt” employees not enumerated among the many exceptions to the Act.

Among the exceptions to the Act, the most frequently applied are the executive, the professional, and the administrative exceptions.

An employee who has supervisory authority over other employees and is paid a salary (that is, not on an hourly basis) is considered to be an executive. A professional employee is generally an individual whose work is based on an advanced degree, such as a lawyer or doctor. The administrative exception is relatively narrow, limited to the confidential secretaries of certain executive-level employees.

Individual employees who fall into one of these three exceptions are “exempt” from overtime calculations.

The problems faced by both employers and employees with respect to the FLSA fall into two broad categories: (1) the designation of employees as “exempt” or “nonexempt” based on job responsibilities, in this age of self-directed work groups and a growing force of white-collar technology workers; and (2) the determination and calculation of overtime hours, which has been complicated by telecommuting and on-line employment.

Many employers feel that the test for determining which employees are exempt from the overtime provisions of the FLSA are outdated, and should include more employees. They argue that technology has increased the number of exempt employees because it has created a class of workers who are more self-directed and are more often making decisions that affect company strategy, thereby falling into the executive or professional classifications.

Conversely, employees argue that the provisions of the Act are not broad enough to cover the growing high-tech workforce, and that many employers are misclassifying salaried employees in computer-related jobs as professional simply because the employees work at a desk or are responsible for their own work hours.

The Act’s provisions regulating exempt/nonexempt designations have been in place since 1954, and clearly have been outgrown by the modern workplace. In a report released in 1999, the General Accounting Office recommended that the Department of Labor, which administers and enforces the FLSA, should revise its regulations to more appropriately reflect the modern workplace.

Unfortunately, given the disparity in the positions advanced by labor advocates and management representatives, comprehensive changes will be slow to develop.

The FLSA requires employers to keep records on hours worked for nonexempt employees, to assure appropriate payment for overtime work. One of the current areas of dissatisfaction with the FLSA is the lack of clear direction regarding records with respect to telecommuters, or other home-office based employees.

Without a consistent method for tracking hours worked by individuals based in locations other than company facilities, employers face liability for miscalculation or inadequate record-keeping, and employees face possible under-calculation of their overtime hours.

Under the FLSA, employees who are entitled to overtime pay must be compensated for overtime worked, even if the employer did not directly require that the work be done, so long as that employer knew or should have known that the work was being done.

For example, an employer was required to pay overtime and attorney fees where evidence indicated that the employer knew that a nonexempt employee had worked overtime, even though the employer denied direct knowledge of that overtime work. Cunningham v. Gibson Electric Co., 43 F. Supp. 965 (1999).

At a minimum, employers should be aware of the following issues:

1. An employer’s designation of an employee as “exempt” is not necessarily final, and may be subject to review by the Department of Labor if a formal complaint is made by the employee.

2. Once a salaried employee is designated as exempt from FLSA overtime provisions, the employer cannot deduct wages for absences (for tardiness or partial-day absence, for example). To do so could invalidate the employee’s exempt status.

3. Under the FLSA, the legal burden of recordkeeping falls to the employer. Employees should be instructed to report all time worked, including mealtimes if, in fact, an employee is required to work through lunch.

4. If training is required to fulfill job responsibilities, employers may be required to pay overtime if the training causes a nonexempt employee’s workweek to exceed 40 hours.

Employers are obligated to conform with the recordkeeping requirements of the Act. In order to avoid liability for FLSA recordkeeping violations, employers must inform employees of the importance of complete and contemporaneous time records, should be vigilant in confirming that such documentation is made and kept in the regular course of business.

Additionally, unless and until the FLSA is clarified and updated, employers must understand that not all knowledgeable and highly skilled employees are exempt from the Act. Designations should take into account the skills and training of the employee, along with a full assessment of the employee’s job responsibilities, wages, need for supervision, and any supervisory duties required in the position.

For most employers, performance reviews are intended to measure the extent to which an employee’s performance meets the requirements of that individual’s employment position.

Employers also use performance reviews to help to establish goals for the future, open channels of communication, and strengthen the relationship between employer and employee.

Some employees, however, perceive that performance reviews are sessions in which every mistake made by that employee in the past review period is dissected and analyzed ad nauseam, that unrealistic goals will be set, and that meaningless threats and/or promises will be made regarding future performance.

Employers and employees often have conflicting opinions about the purpose of performance reviews, which can mean that performance reviews present a significant legal and administrative challenge to supervisors and HR departments.

In order to approach the lofty expectations of employers for performance reviews, and bridge the gap between those expectations and employees’ more negative interpretations, the reviews must include three key elements:

1. Clear identification of job standards;
2. Consistent, objective measurement of the extent to which those standards are being met; and
3. Provision of opportunities for clarification and/or feedback.

If any of the three factors are eliminated, the performance review process is a meaningless exercise and might, in fact, cause more harm than good. 

Before employers can fairly determine whether an employee possesses the knowledge and technical competencies to perform his or her job responsibilities, those responsibilities must be clearly defined and effectively communicated to the employee.

A written job description is helpful, but cannot be the basis of a full and fair performance evaluation unless the employee is aware of the description and of the expectations that flow from it.

Job descriptions should set forth the basic responsibilities of the employment position, should be written in a clear and understandable language, and should specifically list any skills or areas of expertise that the employer deems to be essential to the job.

Failure to include such information could be the basis of an employee’s argument that he or she did not fully understand the scope of the job responsibilities, and was therefore unfairly evaluated. This description should be provided to an employee at the start of employment, and when any substantive revisions are made to the job description for any reason.

In addition to providing a job description to an employee at the beginning of his or her tenure, and providing appropriate updates, an employer should make every effort to use the job description as a reference point during the performance review. Such use adds an element of objectivity to the review process and provides a relevant basis from which to approach a fair evaluation of performance.

Smaller companies, or companies for which written job descriptions are impractical (i.e., “start up” companies in which job descriptions are still in a developmental stage) can include a written list of basic employment responsibilities, if appropriate, such as “compliance with company policies and procedures,” “regular attendance,” and “knowledge of basic operating systems,” and should state clearly to employees that these factors will be part of their performance reviews.

Again, clearly identifying certain standards by which an employee’s performance will be measured establishes an objective basis for the performance review.

Although many employee evaluations systems are based on a numerical ranking system, employers should avoid numerical rankings, if possible. Generally, such systems cause immediate disagreement; it is human nature to feel that one deserves a higher “score” than is received.

Using objective descriptive rankings (“Exemplary,” “Above Average,” “Competent,” “Marginal,” and “Unacceptable,” for example) allows employers to support determinations with factual documentation, and avoids the resentment which is sometimes generated by a numerical “grading” system.

The most obvious, but most frequently disregarded, advice to individuals conducting performance reviews is to set aside friendship, sympathy, and personal animus and evaluate the employee on a factually objective basis.

Just as an unfairly critical review can serve to demoralize an overly sensitive employee, an unwarranted positive review can undermine a company’s future argument regarding a less-than-stellar performer who is terminated for performance problems.

The Supreme Court’s recent decision in Reeves v. Sanderson Plumbing Products (decided June 12, 2000) makes this issue even more critical. In that case, the Court held that an employee’s prima facie case of discrimination, coupled with sufficient evidence for a reasonable fact finder to reject the employer’s nondiscriminatory explanation for its decision to terminate the employee, may be adequate to sustain a finding of liability for intentional discrimination on the part of the employer.

An employer who argues that it terminated an individual for performance problems may weaken its explanation of nondiscriminatory conduct if the documented reviews for the employee indicate only positive comments prior to the termination.

Individuals who conduct performance reviews must be non-judgmental in their approach, avoiding subjective comments and over-generalizations. Written reviews should not include gratuitous editorializing, and should be factual and as accurate as possible regarding specific examples of performance or conduct.

An employer cannot assume that its employee has fully understood a performance review without allowing an opportunity for discussion of that review. Performance reviews should take place with as much privacy as possible, to allow the employee to voice concerns comfortably, and with sufficient time to fully cover both the employee’s achievements and any incidents of marginal or unsatisfactory performance.

The review should allow time for questions, but should not be used as a “gripe” session by either the reviewer or the employee.

Any written evaluation form used in the review process should include sufficient space for employee comments. Employee comments should be followed up promptly, especially if they raise issues that may have an impact on future employee performance or company morale.

While the employee may not agree with each element in the assessment, he or she should be able to sign off on the performance review believing that the process was productive, and done even-handedly and objectively, with full opportunity to voice his or her concerns and questions.

The performance review session should not be used for the following purposes:

1. To discuss general business strategy;
2. To analyze past decisions concerning the employee;
3. To criticize or praise other employees; or
4. To reprimand the employee.

Performance reviews are fundamental to a productive workplace.

The evaluation process, when properly and fairly conducted, can assist in strengthening employer-employee relationships, can increase an employee’s sense of empowerment and personal investment in the company, and lead to a more competitive and satisfied workforce.

When done improperly, performance reviews can work against employers and may actually support a claim for wrongful termination.

The following format has been suggested by the Department of Labor as an appropriate means to obtain certification of a serious health condition of an employee. A copy of this Certification can be found at 29 CFR part 825, Appendix B.

Certification
(to be completed by the Health Care Provider)

1.) Employee’s Name:

2.) Patient’s Name (if different from employee):

3.) The attached sheet describes what is meant by a “serious health condition” under the Family and Medical Leave Act. Does the condition for which the patient is requesting FMLA leave qualify under any of the categories described? If so, please check the applicable category.

5.) Describe the medical facts which support your certification, including a brief statement as to how the medical facts meet the criteria of one of these categories:

1. State the approximate date the condition commenced, and the probable duration of the condition. Please include information regarding the probable duration of the patient’s present incapacity, if different (“Incapacity,” for purposes of the FMLA, is defined to mean inability to work, attend school, or perform other regular daily activities due to the serious health condition, treatment therefor, or recovery therefrom):
2. Will it be necessary for the employee to take off from work only intermittently or to work on a less-than-full schedule as a result of the condition (including for treatment described in Item six below)?
3. If yes, give the probable duration:
4. If the condition is a chronic condition (condition # 4) or pregnancy, state whether the patient is presently incapacitated and the likely duration and frequency of episodes of incapacity:

6.) a. If additional treatments will be required for the condition, provide an estimate of the probable number of such treatments:

7.) a. If medical leave is required for the employee s absence from work because of the employee’s own condition (including absences due to pregnancy or a chronic condition), is the employee unable to perform work of any kind?

8.) a. If leave is required to care for a family member of the employee with a serious health condition, does the patient require assistance for basic medical or personal needs or safety, or for transportation?

(Signature of Health Care Provider)

(Type of Practice)

(Address)

(Telephone number)

State the care you will provide and an estimate of the period during which care will be provided, including a schedule if leave is to be taken intermittently or if it will be necessary for you to work less than a full schedule:

(Employee signature) (date)

A “Serious Health Condition” means an illness, injury, impairment, or physical or mental condition that involves one of the following:

1.) Hospital Care

2.) Absence Plus Treatment

3.) Pregnancy

Any period of incapacity due to pregnancy, or for prenatal care.

4.) Chronic Conditions Requiring Treatments

A chronic condition which:

5.) Permanent/Long-term Conditions Requiring Supervision

6.) Multiple Treatments (Non-Chronic Conditions)

Intermittent medical leave under the Family and Medical Leave Act can create administrative headaches for the unprepared employer.

Employers are becoming increasingly aware of the fact that the conflict between the extensive and often confusing FMLA policy concerns and typical attendance policies have led to contradictory requirements in dealing with employee absenteeism.

This article outlines some of the basic requirements of the FMLA as they pertain to intermittent leave requests, and puts the administrative headaches into perspective.

The FMLA applies to employers with 50 or more employees working within a 75 mile radius, and provides twelve weeks of unpaid leave during a twelve-month period for eligible employees, including those with a “serious health condition.”

The FMLA guarantees the right of the employee to return to the same position or to an equivalent position after an FMLA leave. Importantly, FMLA leave can be taken intermittently under certain circumstances. Defining those circumstances can present a real challenge to employers.

Requests for intermittent leave complicate an employer’s ability to monitor and discipline employees for attendance issues. Employers must make sure to understand the reason for an employee’s excessive absence in order to fully assess whether the absence is FMLA-related.

To further complicate matters, if the “serious health condition” on which the leave is based rises to the level of a disability, the employer may actually be required, under the Americans with Disabilities Act (ADA) to provide extended leaves of absence (even in excess of the twelve week FMLA leave) as an accommodation, if such leave is requested and does not present an undue hardship to the company.

Although the FMLA was passed in 1993, employers continue to struggle with its application and implementation, especially with respect to the Act’s expansive definition of “serious health condition.” For purposes of the FMLA, a serious health condition is defined as “an illness, injury, impairment, or physical or mental condition” that involves either: (a) inpatient care in a hospital, hospice, or residential medical facility; or (b) continuing treatment by a health care provider.

Further, the Act includes the vaguely worded provision that, when an employee is requesting leave for his or her own serious health condition, the condition must be one that “makes the employee unable to perform the functions of the position of such employee.”

Courts have held that the term “serious medical condition” includes not only medical conditions causing continual incapacity, but also conditions causing occasional periods of such incapacity.

For instance, in one of the first cases of its kind, the Third Circuit Court of Appeals has held that an employee’s peptic ulcer disease could be a serious medical condition for purposes of the FMLA. In Victorelli v. Shadyside Hospital, 128 F.3d 184 (3d Cir. 1997), Kathleen Victorelli, a medical technician, was discharged from her employment for violating her employer’s attendance policy. Although she was evaluated as a good employee, Victorelli had a history of absenteeism, had been counseled for and warned about the problem on multiple occasions, and had been advised that any further violation of the attendance policy would result in termination of her employment.

On July 29, 1994, Victorelli informed her supervisor, by telephone, that she would be unable to come to work on that day. She returned to work but was informed, on August 1, that her employment had been terminated, based on her absence on July 29th.

Victorelli filed a lawsuit in U.S. District Court for the Western District of Pennsylvania, alleging that her employer violated the FMLA. Victorelli alleged that her absence was due to her peptic ulcer disease, an ongoing condition, and that the absence was therefore covered under the Act.

The District Court initially granted the employer’s Motion for Summary Judgment, based on a determination that, as a matter of law, Victorelli did not suffer from a “serious health condition” under the provisions of the FMLA and, therefore, was not entitled to the benefits provided under the Act.

The Court of Appeals disagreed with and reversed the trial court’s decision, and held that the issue of whether Victorelli’s medical condition was “serious” should be left to a jury. According to the appellate court, Congress did not intend to deny FMLA protection to an employee simply because a doctor was able to mitigate the frequency of the employee’s discomfort or incapacity.

The Act, according to the court, is also intended to protect those “who are occasionally incapacitated by an on-going medical problem.”

The Department of Labor has issued regulations that outline actions employers may take when an employee requests leave under the FMLA. Those regulations include three specific permissible actions that employers may take when employees request leave that may be covered under the FMLA:

Failure to take these three actions was mentioned by the Court in Victorelli as an inadequacy in the administration of Victorelli’s intermittent leave claim.

Although the appellate Court did not make an ultimate determination regarding whether Victorelli’s leave fell under the protections of the FMLA, it specifically chided the employer for not taking actions that were clearly allowable under the Act, and that may have assisted in that determination. Because the permissible actions had not been taken by the employer, the Court remanded the case back to the trial court for a jury’s decision on the issue.

Employers who receive notice of or a request for medical leave from an employee should carefully review the circumstances to determine whether obligations exist under the FMLA. Because of the complexity of the threshold determination of whether or not the claimed illness or injury is a “serious medical condition,” employers should approach potential FMLA leave requests from a procedural standpoint, taking advantage of the medical certification requests allowed under the Department of Labor regulations.

Taking administrative precautions early in the process to effectively verify and implement allowable leave may preclude subsequent claims of FMLA violation against an employer. Failure to take such precautions may leave an employer at risk of the perils of a jury trial and the punitive damages that may go with it.