BALTIMORE (LN) — U.S. District Judge Stephanie Gallagher granted MedStar Health Inc.’s motion to dismiss all claims in Stimac v. MedStar Health Inc., ruling that the employer’s policy of deferring raises until an employee returns from leave does not violate the Family and Medical Leave Act or constitute a breach of contract.

Stimac, an occupational therapist at a MedStar hospital, sued after she did not receive a 3.5% pay increase on her November 22, 2024 paycheck while on approved FMLA maternity leave. She had used accrued paid time off and short-term disability to ensure her leave remained paid.

When Stimac returned to work in January 2025, she asked why the raise had not been applied during her absence. Tia M. Mitchell, an employee in MedStar’s human resources department, told Stimac that the company’s “standard policy and approach for associates on a leave of absence” is to apply the raise once employees return.

Stimac asked for documentation of this policy. Mitchell responded that she “not have a document to share” with her. Stimac’s first paycheck upon return reflected the raise, but she has not received back pay for the period during her leave.

Gallagher, writing for the court, found that Stimac failed to state a claim for FMLA interference. While the FMLA requires employers to restore employees to the same or equivalent position upon return, it does not directly entitle an employee to a pay increase during the leave period itself.

The court looked to a Department of Labor regulation, 29 CFR § 825.215(c)(1), which states that conditional pay increases must be granted in accordance with an employer’s policy for employees on equivalent non-FMLA leave.

“Although this regulation contemplates pay increases upon return from leave, which the parties agree Plaintiff received, the principle that conditional pay increases must be granted in accordance with the employer’s policy or practice of granting them to employees on non-FMLA leave may be applied to the intra-leave pay increase at issue in this case,” Gallagher wrote.

The judge noted that Stimac’s raise was conditional, tied to performance tiers of “Exceptional,” “Strong,” and “Needs Improvement.” Because MedStar applied the same deferral policy to non-FMLA leaves, and Stimac did not allege that Mitchell’s representation of this policy was false, the court found no interference.

Stimac also alleged breach of contract and unjust enrichment. Gallagher dismissed the breach of contract claim, ruling that the “Strong” tier, also called the “Standard” tier, represented employees who met, rather than exceeded, expectations. Under Maryland law, a promise to pay for doing what an employee is already required to do does not form a contract.

The unjust enrichment claim failed for the same reason: because Stimac was not entitled to the raise under the FMLA or a contract, MedStar was not unjustly enriched by retaining the value of the raise during her leave.

Gallagher dismissed the action but allowed Stimac 30 days to file a motion seeking leave to file an amended complaint.