Plaintiff Covered by FMLA under Joint-Employer Doctrine

On September 19, 2014, the 7th Circuit affirmed summary judgment in favor of an employee on the issue of FMLA coverage under the joint-employer doctrine. Cuff v. Trans States Holdings, Inc., No. 13-1241 (7th Cir., 9-19-2014). The Family and Medical Leave Act applies only to an employer that has at least 50 employees within 75 miles of the employee’s work station. Cuff was on the payroll of Trans States, which only had 33 employees. However, Department of LaborRegulation 29 C.F.R. 825.106(a) provides that workers are covered by the FMLA when they are jointly employed by multiple firms that collectively employ 50 or more workers. In addition, DOLRegulation 29 C.F.R. 825.104(c) provides that 2 or more firms may be treated as a single employer when they operate a joint business. The joint-employer doctrine applies when one person is employed jointly by two firms that otherwise have distinct labor forces. Two important factors are: (1) whether the two firms have an arrangement to share the employee’s services; and (2) whether one employer acts in the interest of the other employer in relation to the employee.

Cuff was the regional manager of Trans States, but in his employment, he represented both Trans States and GoJet, which had 343 employees. He was hired to provide services to both firms, his business card listed both, the firm directory listed him as a contact for both, and his supervisor stated that he was the “go to” person for both. The 7thCircuit held that Cuff was covered by the FMLA because he was jointly employed by Trans States and GoJet, who collectively employ 50 or more workers.

Cuff was awarded $32,000in back pay and front pay, and $325,000in attorneys’ fees. The FMLA authorizes the award of attorneys’ fees to the prevailing party. The 7th Circuit stated that the ratio of the attorneys’ fees award to the damages award was not unreasonable where the defense was conducted in a “blunderbuss fashion.” Hyper-aggressivedefendants who drive up the expenses of litigation must pay the full cost.

Lastly, the 7th Circuit held that the after-acquired evidence doctrine–which can limit damages but not erase the violation–was waived by the defendant because no offer of proof was made when evidence was excluded.