Friday, February 18, 2011

New Rulings Issued on Absences from Work

Recent rulings have been issued on the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA).

Fair Labor Standards Act. In Chavez. v. City of Albuquerque, CA10, Dkt. No. 09-2274, 1/12/11, the U.S. Court of Appeals for the Tenth Circuit ruled that sick leave buy-backs should have been included in the regular rate of pay for overtime computation purposes under the FLSA, but vacation time buy-backs did not have to be included in the regular rate of pay. The employees at issue worked for the City of Albuquerque (the City). They were members of labor unions that entered into collective bargaining agreements (CBAs) with the City. Certain CBAs allowed employees who have accumulated a minimum amount of unused vacation or sick leave to sell that leave back to the City.

29 CFR 778.211(c) of the FLSA includes attendance bonuses in an employee's regular rate of pay. The court considered sick leave buy-backs to be analogous to attendance bonuses. It said that buying back sick days rewards an employee for consistent and as-scheduled attendance. Good attendance provides additional value to the employer.

The court, however, ruled that vacation time buy-backs did not have to be included in an employee's regular rate of pay. The court said that the key difference between sick leave buy-backs and vacation time buy-backs lies in the way each type of day off operates. A sick day is usually unscheduled or unexpected, and is a burden because the employer must find last-minute coverage for the sick employee. In contrast, vacation days are usually scheduled in advance, so their use does not burden the employer in the way that unscheduled absences do. An employee has a duty not to abuse sick days, whereas there is no corresponding duty not to use vacation days.

The court also said that there was nothing inherently wrong with the City's approach of calculating its employees' wage entitlements under the FLSA, and under the applicable CBA, and then paying the greater of the two.

Family and Medical Leave Act. The U.S. Court of Appeals for the First Circuit has affirmed a district court ruling that denied leave under the FMLA to an employee who accompanied her husband on an unapproved seven-week spiritual healing trip [Tayag v. Lahey Clinic Hospital, Inc., CA1, Dkt. No. 10-1169, 1/27/11].

On July 8, 2006, Maria Lucia Tayag requested FMLA leave from August 7 to Sept. 22, 2006, but did not inform her supervisor at Lahey Clinic Hospital (the hospital) that the travel was for a spiritual pilgrimage to the Philippines. Nor did she provide her supervisor with any contact information to reach her during the trip. On July 11, 2006, Tayag's husband underwent an angioplasty procedure. That month, Tayag spoke to Susan Olsen, the hospital's benefits administrator, about the FMLA request, and Olsen requested new FMLA certification from the primary care physician (PCP) for Tayag's husband. The certification from the PCP stated that Maria Tayag should receive medical leave “to accompany Mr. Tayag on any trips as he needs physical assistance on a regular basis.” The PCP provided no explanation as to why a seven-week leave would be needed.

Olsen also requested new FMLA certification from the cardiologist for Tayag's husband. The cardiologist returned the form on Aug. 8, 2006, stating that Tayag's husband was “presently... not incapacitated” and that Tayag would not need leave. Olsen mailed Tayag letters on August 10 and 14 notifying her that the leave was unapproved, and hospital representatives left phone messages with this information at Tayag's home on August 8 and 17. Tayag did not receive any of these messages because she was in the Philippines. Receiving no response, the hospital then sent a letter, dated August 18, that terminated Tayag's employment.

During their time in the Philippines, the Tayags went to Mass, prayed, and spoke with the priest and other pilgrims at the Pilgrimage of Healing Ministry at St. Bartholomew's Parish. Tayag's husband received no conventional medical treatment and met with no doctors or health care providers during his time in the Philippines.

On April 30, 2008, Tayag filed suit against the hospital alleging a number of claims, one being that her termination violated the FMLA. The district court and the First Circuit ruled that Tayag was not entitled to FMLA leave based on the fact that nothing in the PCP's certification provided a basis for a seven-week leave, and the certification by the cardiologist disavowed the need for any leave.

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