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Zisumbo v. Convergys Corp.

United States District Court, D. Utah, Northern Division

November 22, 2017

HOPE ZISUMBO, Plaintiff,


          ROBERT J. SHELBY United States District Judge

         This case presents the question whether an employer may contractually restrict the statutory time limitations for claims under the Family Medical Leave Act (FMLA) and the Employee Retirement Income Security Act (ERISA). Plaintiff Hope Zisumbo submitted a signed job application to Defendant Convergys that imposed, among other things, a six-month limitations period for any employment-related claim. Zisumbo was later hired, worked for Convergys for a short time, and subsequently brought FMLA and ERISA claims beyond the contractual six-month period but within the respective statutory periods. The parties now dispute which limitations period applies. For the reasons below, the court concludes the six-month contractual provision is enforceable for the ERISA claims, but not for the FMLA claims.


         In 2012, Plaintiff Hope Zisumbo submitted a five-page online application for employment with Defendant Convergys.[1] The application stated that Zisumbo agreed “any claim or lawsuit relating to [her] employment with Convergys . . . must be filed no more than six (6) months after the date of the employment action that is the subject of the claim or lawsuit, ” and provided that by signing, Zisumbo “waive[d] any statute of limitations period that is longer than six (6) months.”[2] Zisumbo initialed and submitted the application.

         Zisumbo was hired, and was fired just over a year later on June 28, 2013.[3] Zisumbo had taken some medical leave before being fired, and her supervisor, Defendant John Patton II, told Zisumbo she was being fired for “medical reasons.”[4] Zisumbo subsequently received notice that her health insurance policy through Convergys had been retroactively canceled months before her termination, leaving her responsible for various unpaid medical bills. The following year, a collections agency sued Zisumbo in state court to collect on unpaid medical bills. Those claims were later settled, and Zisbumo filed a Third Party Complaint asserting FMLA and ERISA claims against Convergys, which was removed to federal court. Zisumbo later added as individual defendants her supervisor, John Patton II, his supervisor, Ryan Mitchell, and the Human Resources Business Partner, Adriana Woldberg. Both sides have moved for summary judgment.


         At issue in these cross motions for summary judgment is the timeliness of Zisumbo's claims. Zisumbo's Complaint was filed on June 25, 2014, just under a year after her termination. This makes her claims timely under the statutory limitations periods for the FMLA (two years)[5]and ERISA (six years), [6] but untimely under the restricted 6-month contractual limitations period in her employment Application. The question, then, is whether the Application validly altered the statutory limitations period for any claims under the FMLA and ERISA.

         Defendants contend it did, and request summary judgment on this basis. Zisumbo argues the contractual limitations period is unenforceable for one or more reasons, including: (1) restricting the statutory FMLA and ERISA limitations periods is contrary to public policy; (2) the Application is ambiguous; (3) any waiver of the statutory limitations period was not a knowing waiver; and (4) any waiver is unconscionable. The court first addresses these arguments in the context of the FMLA, and then turns to ERISA.

         The FMLA

         Zisumbo first argues the Application's provision purporting to limit the two-year FMLA statutory limitations period to six-months is unenforceable because it violates public policy. As a general matter, parties may contract to limit the statutorily-prescribed time to bring a lawsuit.[7]

         Their ability to do so, however, is limited in two ways: (1) there must be no “controlling statute to the contrary, ” and (2) the shorter limitations period must otherwise be reasonable.[8]

         The Tenth Circuit has not yet weighed in on whether parties may, consistent with public policy, contractually limit the FMLA's two year limitations period. And district courts that have addressed the issue have created a split in authority. At the heart of the dispute is whether limitations periods are more properly considered a right given to employees or a procedural protection afforded to employers. The distinction is important because a “controlling statute to the contrary”-namely, the FMLA itself-prohibits an employer from interfering with or restraining an employee's rights under the FMLA (but says nothing of expanding procedural protections for employers).[9] Similarly, a Department of Labor (DOL) regulation prohibits both an employee from waiving prospective FMLA rights and an employer from inducing an employee to do so.[10]

         A majority of district courts to address the issue have concluded the FMLA gives employees a right to sue, and a contract shortening the statutory two-year limitations period impedes that right and therefore violates public policy.[11] By contrast, at least one district court has concluded that statutes of limitations are not “rights” given to employees but instead “more correctly exist for the protection of defendants, ” so contractually restricting them does not implicate statutory and regulatory provisions prohibiting interference with or waiver of FMLA rights.[12]

         In the absence of controlling Tenth Circuit authority, this court concludes the better interpretation is that of the majority-that is, that contractual provisions restricting the statutory FMLA limitations period violate public policy and are therefore unenforceable. As discussed above, the question turns on whether the contractual limitations period interferes with a right under the FMLA. To that end, the FMLA undoubtedly provides a right employees would not otherwise enjoy: the right to sue in federal court for certain employment violations, and to do so anytime up to two years after the alleged violation. Indeed, the Act provides that “an action may be brought . . . not later than 2 years after the date of the last event constituting the alleged violation for which the action is brought.”[13] A six-month contractual limitations period “impedes” and “restrains” an employee's ability to bring an action “not later than 2 years after” the alleged violation. The FMLA expressly precludes such interference.[14] Thus, because a “controlling statute to the contrary” precludes restricting the statutory limitations period, the provision in Zisumbo's Application purporting to do just that is not enforceable.

         Defendants provide several arguments why the provision should be enforced, but none carry weight. Defendants first repeat the reasoning of Badgett, the North Carolina District Court decision upholding a contractual limitations period for FMLA claims, arguing that limitations provisions are merely a procedural protection for defendants, not a right given to employees.[15]The court agrees that limitations periods serve primarily to protect defendants. But that is only one side of the coin, for expanding protection to defendants (by constraining a limitations period) necessarily restricts the right of employees to sue. In other words, regardless of the fact that a contractual limitations period expands procedural protection for defendants, it simultaneously restricts rights provided to plaintiffs by the FMLA-something Congress has expressly forbade.

         Defendants next argue the statutory and regulatory provisions at issue do not explicitly discuss limitations periods (referring instead to generalized “rights”), so parties are free to contract around the two-year period. Such specificity, however, is not required. As Defendants agree, the applicable standard from the Supreme Court is whether there exists “a controlling statute to the contrary.”[16] And as discussed, the relevant FMLA provision prohibits “interfere[ing] with, restrain[ing], or deny[ing] the exercise of or the attempt to exercise, any right provided under this subchapter”-one of those rights being that “an action may be brought under this section not later than 2 years” after the alleged violation.[17] This provision is both controlling and contrary to the Application's restriction that an action may not be brought more than six months after the alleged violation.

         Last, Defendants argue “interfere, ” as used in the Act, means interfering with an employee's FMLA leave, not her ability to bring suit. In support, Defendants cite regulations stating that interference “would include, for example” refusing to authorize leave, discouraging employees from using leave, and taking actions to avoid employees becoming eligible for FMLA benefits, among others.[18] That “interfering . . . would include” these acts does not mean it would not also include limiting an employee's ability to sue in contravention of the provision expressly allowing an employee to do so within two years of any violation.

         In sum, the FMLA provides rights to employees, including the right to bring a federal suit within two years of any violation. The six-month limitations period in Convergys's Application interferes with those rights, and consequently runs afoul of the FMLA's proscription on interfering with rights under the FMLA. The Application's provision is therefore contrary to public policy as to Zisumbo's FMLA claim, and will not be enforced. Zisumbo may proceed on her otherwise-timely FMLA claim against Convergys and the individual Defendants.[19]


         While the FMLA precludes an employer from contractually restricting the statutory limitations period, the same is not true of ERISA. Indeed, ERISA has no analogous provision, and both the Supreme Court and the Tenth Circuit have recognized that parties may contractually limit the time to bring ERISA claims.[20] The court therefore concludes the contractual six-month limitations period does not violate public policy as applied to Zisumbo's ERISA claim, and the court turns to Zisumbo's other arguments for why the provision should not be enforced: that the Application is ambiguous, that any waiver of the statutory limitations period was not a knowing waiver, and that any waiver is unconscionable.

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