Same Sales Job, Different Accounts: FMLA Rights May Be Violated Even Though Employee is Reinstated to the Same Job Following Leave

Robin Foret
November 6, 2008 — 2,848 views  
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When an employee will be absent from the office for an extended period of time, it is common practice for the employer to reassign the responsibility for customer accounts to other employees. Certainly, companies do not want customers to experience an interruption in service.  However, consider this scenario:  An employee returns to his sales position following a leave of absence taken under the Family and Medical Leave Act (FMLA or the Act).  Although he is returned to the same job, an important customer account that was transferred to another sales representative in his absence is not returned to him.  The employee claims that this results in a decrease in his annual income.  Has the FMLA been violated?  The answer may be yes! 

In most instances, an employee must be returned to the same or an equivalent employment position upon his or her return from an absence taken under the FMLA.  An employer may not refuse to reinstate the employee and, may not discriminate or retaliate against the employee because he or she has exercised their rights under the FMLA.  An equivalent position is one that is "virtually identical to the employee's former position in terms of pay, benefits and working conditions . . . ." 29 U.S.C. §2614; 29 C.F.R. §825.215.  What does this really mean?  How does it really work? 

Recently, the United States Court of Appeals for the Fifth Circuit in McArdle v. Dell Products, L.P., 2008 WL 4298840 (5th Cir. (Tex)) (unreported opinion) had an opportunity to evaluate this issue.  The Fifth Circuit, considered very conservative and pro-employer in comparison to most other states, found in favor of an employee by refusing to dismiss his FMLA entitlement and retaliation claims.  The court concluded that the right to reinstatement under the FMLA (the entitlement claim) requires more than just a return to the same position if other aspects of the job have been altered in such a way that the employee's income will likely be reduced, or other benefits will be lost.  The court also determined that such alterations to the employment position upon reinstatement may be sufficient to show that the employer retaliated against the employee for taking leave under the Act (the retaliation claim).   

The Entitlement Claim

As always, the facts of the case are important to understanding the decision.  McArdle took FMLA leave in order to have, and recover from, back surgery.  In his absence, his customer accounts were assigned to another salesperson.  Upon McArdle's return to the office, he discovered that one of his accounts (the eBay account) would not be returned to him.  McArdle argued successfully that the loss of this large account would result in a loss of compensation approaching $20,000.00 annually.  The Fifth Circuit concluded that Dell's failure to return the customer account to a sales representative who had returned from FMLA leave could be a failure to reinstate the employee as required by the Act.  This gave rise to a possible entitlement claim under the FMLA.  The court rejected Dell's argument that McArdle was essentially reinstated to the same position and that any changes to his employment were de minimis, meaning minor.  

The Retaliation Claim

McArdle was also successful in arguing that the failure to return the eBay account constituted   retaliation for exercising his right to take FMLA leave.  His assertion was supported by the fact that the employee's immediate supervisor had written an e-mail on the day that FMLA leave began blaming McArdle's extra-curricular golf activities for his back condition and indicating frustration that the time off would interfere with McArdle's job performance.  Near the end of the litigation process, Dell stated that its decision not to return the eBay account to McArdle was made because eBay had complained about McArdle and wanted to remain with the newly assigned sales representative.  The court rejected this argument as not supported by the evidence.  

What went wrong?

Although McArdle was returned to basically the same position, it was not an equivalent position under the FMLA because it was not "virtually identical" to the job he had prior to taking leave.  Removing the eBay account caused the employee to lose income in violation of the Act.  In the alternative, Dell could have given McArdle another account to replace the eBay account in terms of expected annual compensation.  Giving McArdle another large account may have been sufficient to constitute an equivalent position despite the loss of the eBay account.  The employer further compounded the problem by leaving a trail of emails that showed resentment toward the employee in connection with his FMLA leave.     

Better facts next time

An employee has no greater right to reinstatement than existed before leave was taken.  An employer may deny reinstatement if it can show that the employee would not have continued to remain employed in the same capacity at the time the reinstatement request was made.  If feasible, all of McArdle's accounts, including the eBay account, should have been returned to him when he returned from FMLA leave.  If Dell had legitimate business reasons to not return the eBay account to McArdle, such as a customer complaint, it failed to document those reasons. 

Instead, at the beginning of FMLA leave, McArdle's supervisor circulated an email expressing his frustration with McArdle's injuries and the need for FMLA leave.  Legitimate complaints about an employee's performance should be documented in accordance with a written company policy that outlines specific procedures that must be followed.  A mandate that disciplinary policies and procedures be followed helps eliminate angry responses to employment situations, increases the chances that employees will be treated equally when problems arise, and gives an overall sense of fairness to the employment decision making process.     

The information contained in this article is not designed to address specific situations, and does not include rules and regulations that apply to all states.  If you have questions concerning this topic, you should consult with legal counsel of your choice to obtain advice on various fact specific matters.

Robin Foret

The Foret Law Firm

Robin Foret practices in the areas of employment law, commercial litigation and specialty insurance defense claims. She handles a variety of employment matters such as theft of trade secrets, breach of employment agreements, non-competition agreements, wage and hour issues under the Fair Labor Standards Act (FLSA), discrimination and harassment issues under Title VII of the Civil Rights Act of 1964 (Title VII) and the Texas Commission on Human Rights Act (TCHRA), the Americans with Disabilities Act (ADA), Family Medical Leave Act (FMLA) issues, and the Sarbanes-Oxley Act (SOX). Robin has handled a wide variety of employment law matters for employers, as well as for executive-level employees, before agencies, and state and federal courts.