Worker successfully proves retaliation despite employer's limitations defense

Michigan law provides that a party who fails to raise the affirmative defense that the statute of limitations period has passed in an initial pleading waives that defense.

Case name: Shelson v. Schmidt Industries, Inc., No. 281123 (Mich. Ct. App. 03/10/09, unpublished).

Ruling: The Michigan Court of Appeals affirmed the trial court's holding that the employer violated Michigan's Workers' Disability Compensation Act by discharging the worker in retaliation for exercising his rights under the act.

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What it means: Michigan law provides that a party who fails to raise the affirmative defense that the statute of limitations period has passed in an initial pleading waives that defense. Therefore, where the employer first invokes the limitations period in a summary disposition filed more than a year after the commencement of litigation, the defense is deemed untimely.

Summary: A worker underwent hand surgery for an on-the-job injury, missed work, and was placed on light-duty status after his return. The worker alleged he was discharged when his employer became angry that he missed work and was not working fast enough, and the worker threatened to sue the employer. The court ruled that none of the issues the employer raised challenged the claimant's evidence that he was discharged forexercising his rights under the Michigan Workers' Disability Compensation Act.

The employer argued that the claimant's action was untimely because it was filed outside the limitations period contained in the employment agreement. However, the employer waived its defense of the contractual limitations period by failing to raise the affirmative defense in a timely manner.

The court found the trial court did not err in admitting evidence that the employer-owner offered to perjure himself in an unrelated proceeding. The court determined the evidence concerned the employer-owner's credibility and, therefore, the trial court properly exercised its discretion in admitting it. Furthermore, the court explained any possible error in allowing that evidence would be harmless, because the employer's prior conduct constituted testimony against himself. The court also upheld an award of attorney's fees based on an hourly rate of $200 for 150 hours of work.

The Michigan Court of Appeals upheld the finding that the claimant was discharged in retaliation for exercising his workers' compensation rights.

June 11, 2009

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