Does "Serious Health Condition" Mean Worker Cannot Moonlight While On FMLA Leave?
 
May 18, 2004
 
Todd D. Steenson- Chicago

One might assume that an employee with a serious health condition sufficient to qualify for leave under the FMLA should not be allowed to work another job during the period of FMLA leave. Put another way, working another job would seem to be inconsistent with a claim that the employee had a serious health condition entitling her to leave. However, that assumption might be wrong. The United States Court of Appeals for the Eighth Circuit ruled that such moonlighting did not prevent an employee from proving she was entitled to FMLA leave. It allowed the employee to sue for an FMLA violation after she was terminated for moonlighting while on FMLA leave. Stekloff v. St. John’s Mercy Health Systems.

Background Facts

Debbie Stekloff, a psychiatric nurse for St. John’s Mercy Hospital, had an argument with her supervisor about making personal calls during work hours. Shortly after the argument, she told the supervisor that she was too upset to perform her work and was leaving. She then contacted her physician, who recommended that she not return to work for two weeks.

Disagreeing that Stekloff had a “serious health condition” that made her unable to perform the functions of her position, St. John’s fired her eight days later for job abandonment. Among other things, it claimed that her employment in a part-time nursing job at another health facility during that period showed she was able to work. The hospital also argued that Stekloff was ineligible for FMLA leave because she did not suffer a “period of incapacity” of more than three calendar days as required by the Act since she began attending orientation for her second employer the day after she left St. John’s.

Stekloff sued, claiming that her termination violated the FMLA. The Eighth Circuit ruled that Stekloff’s inability to work at the hospital was enough to show that she was unable to work for FMLA purposes and therefore was incapacitated within the meaning of the Act. It expressly rejected the argument that an employee needs to show that she is unable to perform other jobs in addition to her own job to be considered incapacitated under the FMLA.

According to the Eighth Circuit, to qualify for FMLA protection based on a serious health condition, an employee need only show the inability to work in the employee’s current job because of a serious health condition. This is true even if that job is the only one the employee is unable to perform. The court noted that the “serious health condition” inquiry should focus on the employee’s current job with her current employer and in her current environment. As a result, if an employee provides sufficient evidence that she cannot perform the essential duties of her position as a result of a serious health condition, she is eligible for FMLA leave despite her ability to perform job duties for another employer.

Significance

The Stekloff decision certainly sounds counterintuitive and unfair. Why should you have to hold open an employee’s job if the employee is working for someone else? The FMLA does not specifically address the issue — rather, it merely provides that an “eligible employee” may take a total of 12 weeks of unpaid leave during any 12-month period if a “serious health condition makes the employee unable to perform the functions of [her] position.” The Act does not address an employee’s right to continue working in another job while on FMLA leave from her regular employer.

This ambiguity has caused disagreement among federal courts concerning an employer’s right to discipline an employee who works a second job while on FMLA leave. Courts have focused on whether the second job requires job functions similar to those of the regular job from which she has taken leave. If so, courts are more likely to find that working the second job is inconsistent with the employee’s claim that she has a serious health condition qualifying for FMLA leave.

Employers do have a way to protect against this risk by adopting “no-moonlighting” policies prohibiting all employees on leave from working other jobs. The U.S. Department of Labor (DOL) regulations state that “[t]aking outside employment during a period of FMLA leave may in some cases cast doubt on the validity of the employee’s need for leave, particularly if the leave is being taken for the employee’s own serious health conditions.” Moreover, the DOL has stated that an employee’s right to work a second job while on FMLA leave depends on the employer’s policy regarding supplemental employment. Applying a similar analysis, in Sepe v. McDonnell Douglas Corporation, the Eighth Circuit ruled that an employer may lawfully discharge an employee on FMLA leave for violating its no-moonlighting policy.

In Sepe, the employee had taken a 12-week leave of absence from the company to care for his newborn daughter. Shortly after his leave began, the company videotaped him working at an excavating company that he and his wife owned during his normally scheduled work hours. When he returned to work, the company terminated him for violating the terms and conditions of the collective bargaining agreement in place with the union, which prohibited employees from working a second job while on leave from the company. The court found that because the company terminated Sepe for violating the terms of the collective bargaining agreement, the termination did not violate the FMLA.

Practical Pointers

Employers that want to prevent their employees from working a second job while on FMLA or other leave should institute a clear no-moonlighting policy. Such policies should be applied consistently and should follow these guidelines:

• Moonlighting policies should apply equally to all employee leaves, not just FMLA leave.

• The policies should be distributed to all employees.

• All employees going on any kind of leave should be reminded of the no-moonlighting rule.

• If you suspect that an employee is moonlighting, you should fully investigate the matter before disciplining her for violating your policy.

Absent such a policy, you should be careful not to discipline an employee who works a second job simply because she is on FMLA leave unless you have strong and credible evidence that she is capable of performing the essential functions of the job from which leave is being taken. For instance, an employee who claims to have a back condition that renders the employee unable to sit at her desk to perform her regular job duties would lose the protection of the Act if additional evidence reveals that she is performing similar duties for another employer under similar circumstances. The analysis is not as simple, however, when an employee takes leave to adopt a child or care for the serious health condition of a covered family member and continues to work an additional job during the leave. Under such circumstances, you may have greater difficulty establishing that the employee is engaged in FMLA fraud by working a second job while on leave since her own physical capabilities will not be the determining factor.

For more information, email Todd D. Steenson at todd.steenson@hklaw.com or call toll free, 1-888-688-8500.

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