In a case that will prompt many employers to double-check their leave of absence policies, the Sixth Circuit U.S. Court of Appeals has held that an employee who was not eligible for leave under the Family and Medical Leave Act (FMLA) might nonetheless be able to prove entitlement to FMLA benefits due to the FMLA language in the employer’s employee handbook. Tilley v. Kalamazoo Country Road Commission, et. al., No. 14-1679 (6th Cir. January 26, 2015).

Employee Assumed He Was FMLA-Eligible

Mr. Tilley worked for Kalamazoo Country Road Commission (Country Road) since 1993. In 2011, after a series of performance-related issues, he was placed on suspension and issued final deadlines within which to complete three projects. Mr. Tilley and Country Road disagree about whether the first two projects were submitted in compliance with the deadlines. On the morning that the last of the three projects was due, August 1, Mr. Tilley experienced symptoms that made him think he might be having a heart attack and went to the hospital, where he was kept for observation overnight. The next day, his wife notified Country Road that he would be out at least until August 5. Mr. Tilley did not submit the last of the three projects. On August 9, the employee representative for Country Road sent Mr. Tilley FMLA paperwork with respect to his absence from work. By letter sent on August 12, Country Road terminated Mr. Tilley for failing to complete the projects by the deadlines that were set.

Mr. Tilley sued Country Road claiming, among other things, violations of the FMLA. The district court granted summary judgment in favor of Country Road, holding that Mr. Tilley could not establish a claim under the FMLA because he was not an “eligible employee” under the statute. Specifically, an employee of a public agency such as Country Road qualifies for FMLA as an “eligible employee” only if, among other things, his employer employs at least 50 employees at, or within 75 miles of, his workplace at the time the employee seeks FMLA leave. Because Country Road employed fewer than 50 employees at, or within 75 miles of, Mr. Tilley’s workplace, he was not eligible under the FMLA. Mr. Tilley also asserted a claim of equitable estoppel, arguing that Country Road should be precluded from denying his FMLA eligibility because it misrepresented material facts about his eligibility, and that he reasonably relied on the misrepresentation to his detriment. The district court dismissed this claim, too.

Employee Relied on Incorrect Language in Handbook

On appeal, the Sixth Circuit affirmed the district court’s determination that Mr. Tilley was not an “eligible employee” under the FMLA due to the 50 employee/75 mile requirement. However, the court reversed the district court’s decision on Mr. Tilley’s equitable estoppel claim. The court held that, despite Mr. Tilley’s ineligibility for FMLA leave under the statute, Country Road could be required to treat him as FMLA eligible, and the case should proceed to trial on that issue.

The court’s decision was based in part on the FMLA language in Country Road’s employee handbook that stated: “Employees covered under the Family and Medical Leave Act are full-time employees who have worked for the [Country Road] and accumulated 1,250 work hours in the previous 12 months.” The court found this to be a clear statement that Country Road employees who have worked 1,250 hours in the year before seeking FMLA leave, as Mr. Tilley had done, are FMLA-eligible, and that that this unqualified statement as to employee eligibility for FMLA leave satisfied the misrepresentation requirement of Mr. Tilley’s equitable estoppel claim. The court noted that Country Road could have included in its FMLA policy language that clarified the 50 employee/75 mile requirement, but it did not.

The court also found that Mr. Tilley presented evidence that he reasonably relied on Country Road’s misrepresentation to his detriment. Mr. Tilley supplied an affidavit that stated that he assumed he was FMLA-eligible based on language in Country Road’s employee handbook, and that, if he knew he was not eligible, he would have come to work on August 1 and completed the project despite his illness.

Notably, when the Country Road employee representative sent the FMLA paperwork to Mr. Tilley, she informed him in a cover letter that he was eligible for FMLA leave, and also pre-checked the box on the “Notice of Eligibility and Rights & Responsibilities” form that indicated he was eligible for FMLA leave. This did not appear to factor into the Sixth Circuit’s decision, however, presumably because that paperwork was sent on August 9, such that Mr. Tilley could not have relied on it when he failed to submit the final project on August 1.

Handbook Review

The implications of this decision are clear. While employee handbooks can be important tools for both personnel and legal reasons, it is important that they are carefully drafted and regularly reviewed. Outdated or incorrect language might do more harm than good. Also, it is usually the better practice to avoid statements of law or legal conclusions in an employee handbook. For more information about this decision, please contact any member of Schiff Hardin’s Labor & Employment Group.

For more information regarding this decision, please contact any member of Schiff Hardin’s Labor and Employment Group.