We’ve all been there: An employee takes time off (think FMLA or other protected leave), and then you need to take an adverse employment action. Can you do so and risk the inevitable retaliation claim? Do you have to wait some amount of time so the employee’s potentially protected activity isn’t so fresh on everyone’s mind?

We all know that “bad facts make bad law” but the Second Circuit’s opinion in Haran v. Orange Business Services shows the reverse is also true: Good facts can make good law.

Haran’s Employment and Performance in Early 2020

Patricia Haran was a senior account manager for Orange Business Services (OBS). From 2017 to 2019, she successfully handled “B-end” accounts. In January 2020, OBS gave Haran additional responsibility, and she began managing “A-end” accounts as well.

In her mid-2020 performance review, her manager, Adam Kimmick, noted that she had challenges working with the new accounts “including issues with her projected revenue and miscommunications with her team and with a client.” Given her prior performance, Kimmick stated his expectation that her performance for the remainder of 2020 would be on track to meet business objectives and gave her an overall rating of “fully successful.”

Haran’s Leave and Performance in the Last Part of 2020

In October 2020, Haran requested time off to take care of her daughter, who needed surgery. Kimmick told her to take all the time she needed. Neither Haran nor Kimmick mentioned the FMLA. Over the course of three months, Haran intermittently took seven and a half days off, using her available paid time off.

During the last quarter of 2020, OBS was negotiating a new master agreement with one of its largest A-end accounts, and negotiations stalled. Kimmick asked Haran whether she would be able to maintain the pace of her conversations with the account, and a coworker told her that Kimmick would reassign the account to him if she could not participate in upcoming conversations.

Although no one at OBS made any negative comments about her taking time off, Haran testified that she felt increased pressure and took less time off to care for her daughter than she otherwise would have.

In her performance review for the second half of 2020, Haran received an overall rating of “needs improvement”. Although she met both her performance objectives for her B-end accounts and her annual revenue quota, three of her largest A-end accounts decided to stop using OBS’s products. Kimmick wrote that she had made some progress in building a strategy with her team, but the challenges noted in her prior review continued. He observed that her strategy had not resulted in an increase in proposed services and that “her pipeline velocity is potentially not sufficient to meet her 2021 financial growth objectives.” During the review meeting, Kimmick said Haran lacked focus.

Haran took that comment as a reference to her time off during her daughter’s illness and challenged it. Kimmick clarified that he meant she should have been more focused on building relationships with one of the accounts OBS lost.

Another Need for Leave and Employment Termination

In February 2021, Haran’s mother was diagnosed with a serious health condition. Haran requested a day off to take her mother to an appointment, which Kimmick approved. Again, neither Haran nor Kimmick mentioned the FMLA, and Haran used PTO.

About two weeks after taking that day off, OBS terminated Haran’s employment. During the termination meeting, an HR representative stated that OBS was terminating Haran for failing to meet her 2020 quota, but Kimmick clarified that the decision was based on the expectation that she would not meet her 2021 quota.

The Litigation

An employee takes leave that might qualify as FMLA and is terminated shortly thereafter. Is anyone surprised there was a lawsuit? Haran sued OBS for interference and retaliation in violation of the FMLA, as well as familial status discrimination under the New York City Human Rights Law.

The district court granted OBS’s motion for summary judgment, finding that Haran failed to introduce sufficient evidence for a jury to conclude she was denied benefits under the FMLA. The court also held that her retaliation claim failed because Haran never actually exercised rights under the FMLA.

On appeal, Haran argued that evidence showing OBS discouraged her use of leave and failed to provide notice of her FMLA rights was sufficient to send her interference claim to a jury. The Second Circuit disagreed, holding that Kimmick’s criticism of her job performance did not interfere with  her FMLA rights. The court also found that failure to comply with the FMLA notice requirements is “actionable interference only if an employee was prejudiced by this failure.” Because Haran took all the time she requested, she could not show prejudice.

The court also noted what Haran did not argue (arguments that might have created a triable issue). Specifically, she did not argue  that  she  was  unaware  of  her  FMLA rights or that she would not have felt pressure to take less time off had she received the required FMLA notices. Notably, Haran  told a coworker that  she  “should  have  taken  family  medical  leave  off  but  [she]  didn’t  want  to  let  the  company down.”

The appellate court found that Haran’s FMLA retaliation claim failed because “any reasonable jury  would  be  required  to  find  that OBS  terminated  her  based on her job performance, not her request for or decision to take leave.” OBS articulated a legitimate, nondiscriminatory reason for her termination and the court found no evidence of pretext.

Takeaways

• Make sure managers know to contact HR when employees request time off for medical reasons

When Haran told Kimmick she needed time off because of her daughter’s medical issues, he should have contacted HR. When she requested time off to care for her mother, he should have contacted HR again. Because he did not, Haran was able to argue that OBS interfered with her FMLA rights. Fortunately for OBS, Haran took all the time she requested, and this court essentially found “no harm, no foul.”

We all know that employers cannot count on those kinds of good facts. Make sure managers know to contact HR whenever employees say they need time off because of their own or a family member’s medical condition. The next employee (or their lawyer) may create a better record showing that the failure to provide the FMLA notices caused actual prejudice.

• Make sure performance reviews are clear and complete

Kimmick gave Haran two performance reviews in 2020. The first identified specific challenges but expressed confidence that she would overcome them. His specificity gave context to the “fully successful” rating. When he later rated her as “needs improvement,” he could point to previously documented concerns that had not been resolved. The fact that he raised those concerns in writing before any protected activity made all the difference.

• If you misstate something (or it is misunderstood), correct it in real time.

Another key takeaway is the importance of correcting misperceptions immediately. When Kimmick said Haran lacked focus and she objected, he clarified on the spot what he meant. Likewise, when HR misstated the reason for Haran’s termination, , Kimmick immediately corrected the record. Had he delayed either clarification, it could have appeared that OBS was changing its story and opened the door to a pretext argument.

This is the last you will hear from me as an editor of the Labor & Employment Insights blog. I have enjoyed my time in the role and look forward to reading what my partners, Jennifer Trulock and Will Manuel, have to say on the issues of the day. Happy New Year!