Second Circuit Holds HR Professionals Can Be Liable as ‘Employers’ Under FMLA
April 15, 2016
The Second Circuit Court of Appeals has recently held that a human resources manager could be held liable as an employer under the Family and Medical Leave Act (FMLA). In issuing its decision in Graziadio v. Culinary Institute of America, the court also articulated standards for FMLA interference claims and association discrimination claims under the Americans with Disabilities Act (ADA).
Cathleen Graziadio brought suit against her former employer, the Culinary Institute of America (CIA), claiming her employment was terminated in violation of the FMLA and ADA shortly after she took leave to care for her sons’ medical issues. She alleged retaliation and interference under the FMLA, and discrimination on the basis of her association with her son, who she claimed qualified as an individual with a disability under the ADA. In addition to naming CIA as a defendant, Graziadio also named Shaynan Garrioch, CIA’s Director of Human Resources, as a defendant.
The Second Circuit’s Decision
What is an “Employer” Under the FMLA?
The Second Circuit decision, which vacated the lower court’s ruling dismissing Graziadio’s FMLA claims and sustained the dismissal of her ADA claim, is significant for several reasons. Importantly, the decision clarified that an individual, such as a human resources representative, can be held liable as an “employer” under the FMLA.
In reversing the district court, the Second Circuit applied the “economic-reality” test used to determine employer status under the Fair Labor Standards Act. The test, which focuses on the economic realities of the employment situation, essentially asks whether an alleged employer possesses the power to control the individual in question. Specifically, the test focuses on whether the claimed employer had the power to hire and fire employees, controlled and supervised work schedules or employment conditions, set the rate and method of payment, and maintained employment records.
Applying this multifactor test, the Second Circuit concluded that a jury could determine that Garrioch was Graziadio’s employer. The court noted that Garrioch appeared to play a key role in Graziadio’s discharge, as the company directed the issue of Graziadio’s termination to Garrioch. The court further found that the evidence supported a finding that Garrioch exercised control over the terms and conditions of Graziadio’s employment, specifically her FMLA leave. Indeed, the evidence demonstrated that CIA’s human resources department handled requests for FMLA leave on its own. While neither party put forth evidence concerning the rate or method of payment or the maintenance of records, both of which would likely have weighed against a finding that Garrioch was Graziadio’s employer, the court nevertheless concluded that the “overarching question” was whether Garrioch controlled Graziadio’s rights under the FMLA. The court concluded that there was ample support in the record to conclude that Garrioch controlled Graziadio’s rights under the FMLA, which lead to its decision to vacate the district court’s dismissal of Graziadio’s FMLA claims.
FMLA Interference Claim
Next, turning to the issue of FMLA interference, the court formally adopted a standard for prima facie cases that it had applied in previous nonprecedential decisions. The court held that “to prevail on a claim of interference with her FMLA rights, a plaintiff must establish: 1) that she is an eligible employee under the FMLA; 2) that the defendant is an employer as defined by the FMLA; 3) that she was entitled to take leave under the FMLA; 4) that she gave notice to the defendant of her intention to take leave; and 5) that she was denied benefits to which she was entitled under the FMLA.” The court found that Graziadio had set forth sufficient evidence satisfy the five elements of an FMLA interference prima facie case and could proceed on this claim.
Association Discrimination Claim
Finally, the court articulated the standard that a plaintiff must meet to establish an associational discrimination case. Adopting the standard used by other circuits, the Second Circuit held that a plaintiff must establish that: 1) he or she was qualified for his or her job; 2) he or she suffered an adverse employment action; 3) he or she was known to have a relative or associate with a disability; and 4) the adverse employment action occurred under circumstances giving rise to a reasonable inference that the disability of the relative or associate was a determining factor for the action. The court found that Graziadio had not submitted sufficient evidence to establish a prima facie case for association discrimination under the ADA, as nothing in the record suggested that she was “distracted” by her son’s disability; accordingly, it upheld the district court’s dismissal of her ADA claim.
Because Graziadio broadened the scope of FMLA claims in finding that individuals can be held liable as “employers” under the law, employers and their human resources professionals must be vigilant and responsive when dealing with FMLA requests. Employers may want to also ensure that their human resources professionals are well-versed in the requirements and protections of the FMLA to minimize the likelihood of any potential claims.