On Oct. 5, 2010, in a case illustrating the distinctions between Family and Medical Leave Act (FMLA) interference and termination claims, the U.S. Court of Appeals for the 9th Circuit reversed in part and affirmed in part an appeal from the U.S. District Court for the District of Alaska.

This advisory briefly reviews the case, Kinney v. Holiday Companies, and its significance to employers.

Case background

Sally Kinney worked as a cashier for a Holiday gas station. She had been undergoing treatment for kidney cancer since 1997. She previously took unpaid FMLA leave in 2005 and again in 2006.

In February 2007, Kinney began taking medication related to her chemotherapy treatment. The side effects left her dizzy, light-headed, and nauseous. On March 13, 2007, after reporting for work, Kinney told her supervisor that she did not feel well, and asked if someone else could take her shift. Kinney’s supervisor advised that she would try to find someone to fill in for her.

Later that same day, Kinney sold cigarettes to a secret shopper without asking for identification. This violated Holiday’s policy of requiring ID checks for tobacco sales. This was apparently Kinney’s second such violation in a few months, the prior violation allegedly occurring in November 2006. Holiday terminated Kinney.

Kinney filed suit alleging that Holiday violated FMLA in two ways: by denying her request for medical leave and by interfering with her right to seek leave. The second theory was based on the premise that Holiday forced Kinney to work while she was ill and terminated her because management knew her cancer was recurring.

Holiday moved for summary judgment. The District Court granted Holiday’s motion. It found that Kinney never made an express request for FMLA leave. The court observed that “[i]f a request for time off such as Kinney’s could qualify as a valid FMLA request, that would put [the supervisor] in the absurd position of deciding on her own, mid-shift, whether Kinney’s request for leave was a valid one.” The court concluded that the termination was valid, and did not review the interference theory. Kinney appealed.

9th Circuit decision

The 9th Circuit affirmed that the termination was lawful. However, the 9th Circuit faulted the District Court for not analyzing Kinney’s FMLA interference claim. Kinney’s contention was that Holiday knew her cancer was recurring and therefore decided to fire her to avoid having to grant her FMLA leave in the future. Although related to the termination claim, the 9th Circuit determined it was nevertheless sufficiently distinct such that the District Court should have analyzed the interference theory.

On the merits, the 9th Circuit concluded there were genuine issues of material fact in dispute because managers discussed Kinney’s recurring cancer, and there was some reason to doubt whether Kinney had violated the tobacco sales policy. In reversing, the 9th Circuit relied on a seldom-used principle: Summary judgment is not appropriate if a plaintiff is entitled to relief on a legal theory and requested the specified relief even if plaintiff’s counsel misconceived the proper legal theory of a claim.b

Significance of Kinney v. Holiday Companies

There are a handful of lessons that employers can draw from this case:

  • If an employer has notice of circumstances potentially implicating FMLA or the Americans with Disabilities Act (ADA), the employer should proactively develop information in an appropriate and confidential manner. This should primarily involve engaging in an interactive dialogue with the employee in question. If the circumstances support designation of FMLA leave, the employer should make sure that an appropriate designation is made.
  • Never assume that “magic words” are required to invoke rights under the law.
  • An employee on FMLA leave is not insulated from discipline, even termination. However, employers should be careful to make sure that any decision affecting an employee who is out on FMLA leave is fair in form and function, and is supported by competent evidence.
  • Consistency is important. Employers should develop policies to help foster consistent decision-making.