Ragsdale v. Wolverine World Wide: the first step toward FMLA reform?(Family and Medical Leave Act of 1993)

In Ragsdale v. Wolverine World Wide, 122 S. Ct. 1155 (2002), a divided court struck down a U.S. Department of Labor regulation providing that an employee's 12-week leave entitlement under the Family and Medical Leave Act of 1993 (FMLA) does not start to run until the employer notifies the employee that his or her leave will be counted as FMLA leave. Unfortunately, there are many other aspects of the Department's FMLA regulations that similarly contradict the statutory language and intent. The Ragsdale decision sends a strong signal that the FMLA regulations need to be revisited. This article discusses the Supreme Court's decision in Ragsdale that invalidated the penalty for the Department's individualized notice regulation. In addition, the article discusses other FMLA regulations that exceed their statutory authority and provides examples as to how the regulations are undermining the main goal and purpose of the FMLA and making compliance difficult for employers. In conclusion, the authors of this article make recommendations for reform of the FMLA regulations and discuss the likelihood of such reform.

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The Family Medical Leave Act of 1993 (FMLA) allows employees to take up to 12 weeks of annual unpaid leave for the birth or adoption of a child or for the employee's own serious health condition or the serious health condition of a close relative. Most employers appreciate and support the goal of the FMLA, which is to give unpaid time off to employees who have a medical event that requires them to be away from work. However, in practice, it has become all too clear that the regulations implementing the FMLA go beyond the authority of the statute or the congressional intent of the statute. The result is that the regulations render the process of providing and tracking FMLA leave overly burdensome, often because employees are able to abuse the regulations. The recent U.S. Supreme Court decision in Ragsdale provides an excellent example. In Ragsdale, the U.S. Supreme Court determined that the regulations governing the failure of an employer to provide notice regarding FMLA constituted an "impermissible alteration of the statutory framework...." Unfortunately, there are many other aspects of the Department's FMLA regulations that similarly contradict the statutory language and intent. The Ragsdale decision sends a strong signal that these provisions need to be revisited. This article discusses many of these provisions and provides examples as to how the regulations are undermining the main goal and purpose of the FMLA and making compliance difficult for employers.

RAGSDALE v. WOLVERINE WORLD WIDE

In Ragsdale--the U.S. Supreme Court's first decision interpreting the FMLA--a divided Court struck down a U.S. Department of Labor (DOL) regulation providing that an employee's 12-week leave entitlement under the statute does not start to run until the employer notifies the employee of its designation as FMLA leave.

Facts and Lower Court Rulings

Tracy Ragsdale began her employment with Wolverine World Wide, Inc. on March 17, 1995. In February 1996, she was diagnosed with cancer, and on February 21, 1996, she requested medical leave from Wolverine. Wolverine granted her request, and Ragsdale's leave commenced on that date.

Wolverine's leave policy allowed employees with six months of service to take leave for up to seven months. Ragsdale requested and was granted (in approximately 30-day increments) leave for seven months. Wolverine did not, however, notify Ragsdale of her eligibility for leave under the FMLA or her right to have leave designated as FMLA leave. Following the exhaustion of her eligibility for leave pursuant to Wolverine's policy and due to her continuing inability to return to work, Ragsdale was terminated from her employment with the company on September 20, 1996. On September 26, 1996, Ragsdale requested that Wolverine grant additional FMLA leave. She was informed that she had requested and utilized all of her available leave. Ragsdale was released to return to work in December 1996.

On December 22, 1997, Ragsdale filed suit in the United States District Court for the Eastern District of Arkansas alleging, inter alia, a violation of the FMLA. On November 3, 1998, the district court granted summary judgment to Wolverine on Ragsdale's FMLA claim. Subsequently, Ragsdale filed an appeal in the U.S. Court of Appeals for the Eighth Circuit. The Eighth Circuit upheld the district court and found that the DOL notice regulations--which provide that unless the employer prospectively designates company leave as FMLA leave, the 12-week FMLA leave entitlement does not begin to run--are based on an erroneous interpretation of the FMLA and cannot be enforced. (1) Ragsdale petitioned the Supreme Court for a writ of certiorari, which was granted. (2)

Supreme Court's Decision

Ragdale's claim relied on the Department's regulation, which provides that if an employee takes medical leave "and the employer does not designate the leave as FMLA leave, the leave taken does not count against an employee's FMLA entitlement." (3) Since Wolverine did not make the designation required by the Department, Ragsdale argued that her 30 weeks of leave did "not count against [her] FMLA entitlement." (4) Pursuant to this argument, it followed that when Ragsdale was denied additional leave and terminated after 30 weeks, the statute guaranteed her 12 more weeks.

Justice Anthony M. Kennedy, writing for the five-member majority, (5) found that the regulation was incompatible with the liability and remedies provisions in the FMLA and exceeded the Secretary of Labor's authority to issue rules implementing the statute. Justice Kennedy acknowledged that the Secretary's judgment "must be given considerable weight," but said a rule must be invalidated if it is arbitrary, capricious, or manifestly contrary to the statute. Kennedy noted that the FMLA limits protected leave to a total of 12 weeks in any 12-month period for the employee's serious health condition, for a family member's serious health condition, or for the birth, adoption, or foster care of a child. (6)

In the Court's opinion, Kennedy stated that the statute already explicitly requires employers to post a notice in the workplace describing FMLA rights. (7) The DOL regulations are "in addition" to what the statute requires. The Secretary of Labor argued that the more comprehensive and individualized notice required by the regulations is necessary to ensure that employees are aware of their rights when they take leave. In response, Kennedy wrote:

 
   We need not decide today whether this conclusion accords with the text and 
   structure of the FMLA, or whether Congress has instead "spoken to the 
   precise question" of notice ... and so foreclosed the notice …