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Temporary, Indefinite Employment Following Layoff Notice Does Not Toll Filing Period for Discrimination Claims

    Client Alerts
  • October 07, 2011

Under federal anti-discrimination laws, aggrieved employees must file a Charge of Discrimination with the Equal Employment Opportunity Commission within a certain period after they experience an adverse employment action. Last week, the Fifth Circuit Court of Appeals concluded that this time period begins running when an employee was informed of a layoff decision, and not when her employment actually ended after a temporary recall.

In Phillips v. Leggett & Platt, Inc. the plaintiff was informed of her permanent layoff. Four days later, she was recalled to assist with consolidation of the company's facilities. She continued to work in the temporary recall position for six months before she was permanently terminated. The plaintiff filed an age discrimination Charge with the EEOC following her termination, but the employer contended that it was untimely, because it exceeded the maximum filing period dating from notification of the layoff.

In a 2-1 decision, the Fifth Circuit agreed, reversing a jury verdict for the plaintiff. The majority noted a 1980 Supreme Court decision establishing the general principle that mere continuity of employment does not constitute a continuing discriminatory action. The EEOC filing period ran from the unequivocal notice of the layoff and not the subsequent recall period of employment. The employee was never given any indication that the temporary recall meant that the employer was reconsidering the permanent layoff decision.

The dissenting judge noted the mere four day period between layoff and recall, and the fact that the employee continued performing her old duties for the company for an additional six months. In addition to causing doubt in her mind about the permanency of the prior layoff decision, this action constituted grounds for an equitable tolling of the limitations period.

When there is a delay between an announced employment action and final termination, employers receiving legal claims relating to the action should carefully consider whether the employee's complaint complies with the relevant limitations period.