You are the HR manager and have just received an FMLA leave request from an employee. At almost exactly the same time, the employee’s supervisor comes to you wanting to terminate the employee because of performance issues. You know that FMLA leave does not prohibit an employer from taking action based on an unrelated, legitimate business reason, so you review the supervisor’s information (which supports termination) and sign off on the decision.
Of course, the employee then sues the company for violating the FMLA, claiming the termination was retaliation for her leave request. Later, you learn that the supervisor’s information that justified termination was not true or not supported by the facts. You (and others) were duped by the supervisor to permit the termination! It may be cold comfort for the company that, at least, this isn’t a willful violation of the FMLA, rendering the company liable for double damages, also known as liquidated damages.
Or is it?
Just last week, the Eighth Circuit Court of Appeals (which covers the federal trial courts in Missouri, Iowa, Arkansas, Minnesota, Nebraska, and North and South Dakota) held that an employer can be required to pay liquidated damages under the FMLA even if the alleged violation occurred because of the malfeasance of a single employee. The rationale? The Eighth Circuit held that the “cat’s paw” theory of employer liability should not be watered down to exclude additional damages.
A little background: the “cat’s paw” theory is a way in which an employer can be held liable for discrimination if the employer acts based on input from a biased employee. The fancy name comes from a fable, the Monkey and the Cat, in which a monkey convinces a cat to pull chestnuts from a hot fire, and then eats the chestnuts himself. All the cat gets in the end is a burnt paw. For more on the “cat’s paw,” read this article and this advisory written by attorneys including HRLawMatters bloggers Brandon Dhande and Evan Pontz.
In the case before the Eighth Circuit, the worker claimed that her supervisor was looking for any reason to terminate her employment due to her taking leave. Based on the evidence offered, the jury agreed, awarding her actual and liquidated damages. (It certainly helped her that the supervisor had made numerous negative comments about her taking leave, and that she had previously been fired while on FMLA, only to be rehired then because of the perceived risk of FMLA liability!) The company appealed the damages award, arguing that there was no evidence that the worker’s decision to seek leave played a role in her firing, and that her termination was decided by three managers who did not even know about the leave.
The Eighth Circuit held that the cat’s paw theory should be applied when considering liquidated damages, not just when determining liability and lost wages, and that to do otherwise would only arbitrarily penalize plaintiffs proceeding under a cat’s paw theory.
In this case, the employer clearly did not proceed with caution, and it paid the price. The lesson: ensure decisions made during or in close proximity to FMLA leave are appropriate, well-documented, and supported by objective facts. HR officials and all supervisors should be properly trained on the FMLA (and other laws and company employment policies) before situations like the one in the case above arise. These steps will help protect employers from getting burned.