Nov. 15, 2011 – A law firm that fired an employee while she was on maternity leave recently lost its summary judgment fight in the U.S. Court of Appeals for the Seventh Circuit.

Chicago-based SmithAmundsen LLC terminated Lisa Makowski, the marketing director for the firm, while she was on maternity leave under the Family and Medical Leave Act (FMLA). The firm’s chief operating officer and its executive committee chair told Makowski, over the phone, that her position was being eliminated as part of a firm organizational restructuring.

Makowski said the firm’s human resources director informed her she was actually terminated because she was pregnant and took medical leave, and suggested speaking with a lawyer. The human resources director, who monitor’s the firm’s compliance with anti-discrimination laws and consulted outside counsel before Makowski’s firing, denied saying that.

Makowski sued the law firm, alleging pregnancy discrimination under Title VII of the Civil Rights Act of 1964, as amended by the Pregnancy Discrimination Act. She also alleges the firm interfered with her rights under FMLA and unlawfully retaliated to an exercise of her rights.

The U.S. District Court for the Northern District of Illinois granted the law firm’s summary judgment motion on all claims after ruling that statements attributed to the human resources director (Molly O’Gara) were inadmissible on hearsay grounds.

However, a three-judge panel for the Seventh Circuit Court of Appeals reversed in Makowski v. SmithAmundsen LLC, No. 10-3330 (Nov. 9, 2011), concluding that O’Gara’s statements, if made, were not hearsay but rather an admission by a party opponent and thus admissible.

Specifically, Rule 801(d)(2)(D) of the Federal Rules of Evidence provides that a statement is not hearsay if the statement “is offered against a party and is … a statement by the party’s agent or servant concerning a matter within the scope of the agency or employment, made during the existence of the relationship. …”

The district court ruled that O’Gara’s alleged statements to Makowski were not admissions by a party opponent because her job responsibility did not relate to the termination decision. Without O’Gara’s statements, the district court ruled, summary judgment was warranted.

But the appeals panel disagreed, explaining that O’Gara’s statements were admissions by a party opponent because she was involved in the process leading up to Makowski’s termination even though O’Gara did not make the decision to terminate.

“O’Gara’s duties as Human Resources Director at the Firm included regular consultations regarding decisions to eliminate positions and terminate employees in order to ensure compliance with federal anti-discrimination laws, making her a part of the firing process,” wrote District Judge Richard Young, sitting by designation.

The panel ruled that a jury must decide whether O’Gara made those statements, but assuming she did for purposes of summary judgment, granting summary judgment was not warranted.

“O’Gara’s alleged statements to Makowski, which are now admitted under Rule 801(d)(2)(D), provide direct evidence that pregnancy was a motivating factor in Makowski’s discharge,” Judge Young wrote. “Although O’Gara denies having made the alleged statements, whether or not she made such admissions is a question for the jury."

Joe Forward is the Legal Writer for the State Bar of Wisconsin.