Court: Dismissal For Policy Violation Is Not FMLA Related

May 19, 2003 ( - The termination of an employee who managed the family restaurant while on leave from his other employer is not a violation of the Family Medical Leave Act (FMLA).

>The 6th US Circuit Court of Appeals affirmed the decision by a lower court to dismiss the plaintiff’s FMLA violation case.   In the appeals ruling, the court found the plaintiff was dismissed because he violated his employer’s “no unauthorized work for personal gain while on leave” clause, not because of the leave that was taken, according to Spencer Benefits Reports.

Case Background

>Viengsamon Pharakhone, a production technician at an automobile plant operated by Nissan North America, notified his immediate supervisor, Rodney Baggett, in late November or early December 1997, that his wife was expected to give birth and that he would need to take leave following the birth.   The leave was necessary, Pharakhone explained, so that he could care for his wife and baby and to help manage a restaurant that his wife had recently purchased.

>However, Nissan’s employee handbook contained a provision prohibiting unauthorized work while on leave, and Baggett contends he informed Pharakhone of this fact before the leave was taken.   The conversation was then reported to Baggett’s supervisor and human resources representative.

>The day after Pharakhone’s child was born, he called Baggett and asked for four weeks of leave, a request granted by Baggett.   At some point during the conversation, Pharakhone gave Baggett the telephone number of the restaurant as a place where he could be reached, and several hours later, Baggett called Pharakhone at the restaurant and reminded him that working while on leave was not permitted.

>This action prompted a phone call by Pharakhone to Nissan’s human resources manager, who confirmed that he was not permitted to work at the restaurant while on leave. Further, the human resources manager sent Pharakhone a memorandum stating that he was “not allowed to perform work of any kind without prior approval from the company,” and that “performing unauthorized work while on leave will be grounds for termination.”

>Nevertheless, Pharakhone worked at the restaurant throughout his four weeks of leave. Nissan discovered this and at the completion of his leave, the company fired him for violating company policy.

Initial Action

>In response, Pharakhone filed suit against Nissan in the US District Court for the Middle District of Tennessee, alleging that his termination violated the FMLA. However, the district court dismissed Pharakhone’s FMLA claim, concluding that Nissan was entitled to terminate his employment because he had worked while on leave.

>Pharakhone appealed, but the 6th Circuit affirmed the district court’s ruling, finding, “h aving discovered that Pharakhone was violating company policy, Nissan fired him – and there is no evidence that it had an ulterior motive for doing so. The undisputed evidence thus compels a finding that Mr. Pharakhone was discharged because he violated Nissan’s no-work policy, and not because he took FMLA leave.”

The case is Pharakhone v. Nissan North America, Inc., et al. (No. 01-5955).