Placement on Leave Pending Investigation is Not Adverse Action

Kollman & Saucier
Kollman & Saucier

When employers conduct investigations into suspected employee misconduct, they often place the employee on administrative leave pending the outcome of the investigation.  The United States District Court for the Eastern District of Virginia recently held that placing an employee on such a leave does not amount to an adverse employment action under the anti-retaliation provisions of the Sarbanes-Oxley Act.  Kashif v. PNC Bank, Civil Action No, 1-20-cv-118-MSN-TCB (E.D. Va. 11/29/21).

The case arose when a PNC Employee Relations Investigator conducted an investigation into suspected wrongdoing by plaintiff Kashif.  The investigation concluded that plaintiff engaged in sales manipulation and falsification of customer information when she improperly conducted a transaction for a stranger without verifying their identity.  On December 27, 2019, the investigator placed Kashif on paid leave, pending the outcome of the investigation.   The same day, Kashif resigned her employment with PNC.  Although Kashif later tried to rescind her resignation, PNC refused to accept the rescission. 

On September 24, 2020, filed suit against PNC, alleging that she was discriminated against  in retaliation for making an internal complaint about other other PNC employees she suspected of improprieties. Specifically, Kashif contended that her  suspension was an adverse employment action taken against her for engaging in “whistleblowing” activity protected by the Sarbanes-Oxley Act. After the conclusion of discovery, PNC moved for summary judgment. 

Judge Nachmanoff granted PNC’s motion, finding that “being placed on paid administrative leave, without more, is not an unfavorable personal action in this Court.”  The Court distinguished this situation from that of employees  who are placed on leave and then either terminated or given a choice between resignation and termination.  The Court was also unpersuaded by the fact that PNC rejected Kashif’s attempt to rescind her resignation, noting that “federal courts across the country have held that the refusal to allow rescission of a voluntary resignation does not constitute an averse action.”

Although the Kashif decision arose under the Sarbanes-Oxley Act, Judge Nachmanoff relied on cases interpreting Title VII. As a result,  this decision is good authority for Virginia employers defending against a retaliatory discharge claim arising under other workplace statutes. 

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