Cendant Hit with Giant FMLA Award

October 2, 2002 (PLANSPONSOR.com) - A Cendant Corp. Internet executive has been awarded $496,344 in damages for her claims her rights were violated under the Connecticut Family Medical Leave Act (FMLA).

According to a Connecticut Law Tribune article, Kim Persky’s award by a state Labor Department hearing officer is the largest ever in Connecticut.

In addition to the damage award, hearing officer Lee Ellen Terry said Persky is also entitled to attorney fees and interest dating back to October 15. The award can still be rejected, modified or approved by the Connecticut state labor commissioner.

Persky’s Leave Began After Baby’s Birth

According to Terry’s findings as reported in the Law Tribune article, Persky began her family leave January 25, 1999 on the day her baby was born. She had been working for Cendant predecessor CUC International on a joint project with the Microsoft Corp. Cendant is based in Stamford, Connecticut.

The two companies partnered as part of the Sidewalk.com project to develop a series of city-specific Internet city guides to food, entertainment and cultural events.

Terry said the joint project ran into problems, in part because of bad will between employees of the two companies.

In March, Persky was told her Sidewalk job had been eliminated in a restructuring and that she could take a lesser position or explore a severance package, the Law Tribune article said.

Four Other Jobs Offered

She was initially offered, but was never paid, two weeks’ pay for every year of service. Instead, she explored some of the four vice president jobs purportedly offered in telemarketing and small business travel, but she was not offered a position equivalent to her old job, according to Terry’s findings.

Persky’s stock options and bonuses would become less valuable if she agreed to resign, as Cendant argued she had in July 1999. The bonuses and stock options later became large components of Persky’s award under Terry’s proposed decision.

In addition, because Persky has a parallel case pending in federal court, she is planning to petition for double damages there, under the 1993 federal FMLA. the Law Tribune reported.

Jonathan Yee was selected to perform Perkins’ work while she was on maternity leave and was assigned her job permanently in a February 2, 1999, transition agreement issued just days after her departure.

Hearing officer Terry determined that Perkins was entitled to her old salary and stock options, plus the same bonuses extended to Yee.

Although Cendant contended it told her of four other positions, Terry determined only one was actually offered, and Persky was justified in refusing it because “it was not substantially equivalent in terms of status and responsibility.”

In its post-hearing brief, Cendant said the ruling attempts to ignore business events within Cendant that affected everyone and had nothing to do with Persky’s leave of absence. It criticized her competence and credibility, contending she was obligated to take one of the four jobs to mitigate damages.