You probably are aware of your obligation under the Family and Medical Leave Act (FMLA) to provide employees up to 12 weeks of job-protected leave to care for their own or an immediate family member's serious health condition or the birth or placement of a child. When to grant this leave is a complex issue and was the topic of "Frustrated with FMLA?," January issue, page 36. But the law recently was expanded.
NDAA changes
On Jan. 28, President Bush signed into law H.R. 4986, the National Defense Authorization Act (NDAA) for fiscal year 2008, which amended FMLA for the first time since its passage in 1993. Specifically, NDAA expands FMLA by providing extended leave to eligible employees to care for covered service members or to address a qualifying exigency arising from a covered family member's active duty status or notification of an impending call to active duty status in support of a contingency operation.
Care for service members
NDAA specifically amends various FMLA sections to provide eligible employees with up to 26 weeks of leave in a single 12-month period to care for a spouse, child, parent or next of kin who is a member of the armed forces undergoing medical treatment, recuperation or therapy; is in "outpatient status"; or is on the temporary disability retired list for a "serious injury or illness" incurred in the line of duty.
Unlike traditional FMLA leave, service member family leave does not require a service member to suffer from a serious health condition and the leave is available not only to FMLA-covered family members but also to next of kin, meaning a service member's nearest blood relative.
For purposes of service member family leave, "serious injury or illness" is defined as an injury or illness incurred by the service member in the line of duty that may render the service member medically unfit to perform the duties of the service member's office, grade, rank or rating.
"Outpatient status" refers to the status of the service member assigned to a military medical treatment facility as an outpatient or a unit established to provide command and control of service members receiving medical care as outpatients.
The 26-week leave entitlement is a combined leave total, which includes an employee's 12-week leave entitlement to care for his or her health or an immediate family member's serious health condition or the birth or placement of a child.
So an employee who exhausts the 12 weeks of leave for his or her own serious health condition would be entitled to an additional 14 weeks to care for an eligible service member undergoing medical treatment during the same 12-month period. Alternatively, an employee who exhausts the entire 26 weeks of leave to care for a service member is not entitled to any additional time in a 12-month period to care for his or her own serious health condition.
Moreover, eligible employees may take the 26 weeks of leave intermittently or on a reduced leave schedule if medically necessary to care for the family service member. If an employee requests intermittent leave or leave on a reduced leave schedule, you may require the employee to transfer temporarily to an available alternative position for which the employee is qualified that has equivalent pay and benefits and better accommodates recurring periods of leave.
You may continue to require all such leave to be supported by a sufficient certification issued by a health care provider. An employee also must provide, in the case of foreseeable service member family leave, at least 30 days' notice before the leave is to begin or, if the date of treatment requires leave to begin in fewer than 30 days, notice as soon as practicable.
Finally, employees may elect, and you may continue to require employees, to substitute their accrued paid time off for any part of the 26-week service member leave, and if an employee cannot return to work at the end of the scheduled service member leave because of the continuation, recurrence or onset of the condition, you may require a certification issued by the service member's health care provider to that effect. The service member family leave provisions went into effect Jan. 28.
Qualifying exigencies
NDAA also amends FMLA to provide eligible employees with up to 12 weeks of leave because of any "qualifying exigency" arising out of the fact that an employee's child, spouse or parent is on active duty or has been notified of an impending call to active duty in support of a contingency operation.
The provisions for leave based on qualifying exigencies are not effective until the secretary of labor issues regulations defining "qualifying exigency." But the U.S. Department of Labor (DOL), recognizing the significant number of U.S. military service members currently on active duty or call to active duty status, is fully aware of the need to issue regulations as soon as possible and has been consulting with the Departments of Defense and Veteran Affairs and U.S. Office of Personnel Management to do so.
DOL anticipates that after considering the comments received in response to its notice of proposed rulemaking Feb. 11, it will issue its interpretive regulations addressing FMLA leave for qualifying exigencies in final form.
DOL's proposed changes
In addition to the service member-related leave amendments to FMLA, DOL published its long-awaited, updated regulations interpreting FMLA Feb. 11.
At press time, the regulations are in proposed form only and were subjected to a 60-day public comment period (which expired April 11). The regulations reflect DOL's experience during the past 15 years in administering the law, several U.S. Supreme Court and lower court rulings, discussions with various stakeholders (including a meeting that included health care providers), and the receipt and review of more than 15,000 comments in response to its December 2006 Request for Information (RFI) and publication of its June 2007 FMLA Report on the RFI.
Although the regulations are in proposed form and subject to modification, they likely are indicative of changes to come.
DOL's proposed regulations attempt to clarify the admittedly vague terms that have resulted in so much litigation and rampant abuse of FMLA privileges by employees, particularly with respect to the definition of serious health condition, FMLA notice requirements for employers and employees, and the medical and fitness-for-duty certification processes.
Eligibility notice
The proposed regulations would change the timing and content of the individual eligibility notice you must provide an employee after the employee has notified you of a need for FMLA leave. The proposed regulations would increase from two days to five days the time in which an employer must notify an employee whether he or she is eligible for FMLA leave (eligibility requires working for 12 months and 1,250 hours). The regulations also would require you to specify in the notice whether the employee still has FMLA leave available during the 12-month period.
If an employee is not eligible for FMLA leave, the notice must state the grounds for ineligibility. If the employee is eligible, the eligibility notice must include (in addition to the requirements in the current regulations) a medical certification form, if you require one, and a list of the employee's essential job functions if you require a fitness-for-duty certification before returning to work.
Designation of leave
The proposed regulations also seek to change the timing and manner of an employer's notice designating leave as FMLA leave.
As with the eligibility notice, DOL has proposed increasing to five days the time in which you must notify an employee you have designated leave as FMLA leave. This five-day period runs from the time you receive enough information—from either the employee or a health care provider—to allow you to make the designation determination, which, in some cases, will run concurrently with the five-day period in which the eligibility determination must be made.
You also would be required to inform employees of the number of hours, days or weeks that will be designated as FMLA leave. If a leave request is for intermittent or chronic leave, you would have to inform the employee, at least every 30 days, how much of the leave taken in the prior 30-day period was designated as FMLA leave. Under the new rules, you also would be obligated to notify employees if leave is not designated as FMLA leave because of insufficient information or a nonqualifying reason. DOL has established an optional prototype designation notice incorporating these proposed requirements.
Notably, an inadvertent failure to designate notice no longer will require you to provide additional leave above and beyond the statutory 12-week entitlement. This revision directly addresses the Supreme Court's decision in Ragsdale v. Wolverine World Wide Inc. In that case, the court invalidated the penalty provision of a regulation that prevented an employer from counting leave against an employee's 12-week FMLA entitlement if the employer failed to properly designate the leave as FMLA leave.
The penalty would have required an employer to provide an additional 12 weeks of FMLA-protected leave after the 30 weeks of leave the employee already had taken. The court found such a result was inconsistent with the maximum statutory requirement of 12 weeks of protected leave and at odds with the remedial requirement that an employee must suffer individualized harm to impose liability on the employer.
In light of these considerations, the new regulations exclude the punitive language confirming an employee's FMLA entitlement is capped at 12 weeks. Rather, if you fail to give proper notice designating leave as FMLA-qualifying as required under the regulations and an employee can show harm as a result, such as lost compensation and benefits; other monetary losses; and other equitable relief including employment, reinstatement and promotion, you may be held liable for that harm.
Posting notices
The proposed regulations change the manner in which you can comply with your obligation to post general notice of FMLA rights to employees and applicants to permit posting of electronic notices. However, electronic posting must be made available to all employees and applicants. If employees do not have direct access to computers in their work areas, you must take measures (such as providing computer kiosks in lunch rooms) to ensure all employees can access the electronic posting.
Likewise, if you accept walk-in applicants, you must provide computer kiosk access to those applicants if you have no physical posting of FMLA rights for applicants and employees. The proposals also make clear that all covered employers, even those with no eligible employees (those who have not been employed for 12 months, have not worked 1,250 hours, and are not employed at work sites where 50 or more employees are employed within 75 miles), must post the general notice.
Notwithstanding the availability of electronic posting, you also would have to include the FMLA notice in your employee handbook or distribute it—physically or electronically—at least once per year to all employees. Regardless of the format, the posted and distributed notices should be identical. DOL has revised its prototype notice to include additional information about employees' rights under FMLA.
Medical certification
The new regulations seek to alleviate employer and employee concerns about FMLA's medical certification process. Most notably, an employee still would be required to submit a medical certification from a health care provider within 15 days to allow you to determine whether the need for FMLA leave qualifies but would be entitled to up to seven additional days (rather than the current "reasonable opportunity" of time) to correct any deficiencies in the certification, including incomplete sections of the medical certification form or vague, ambiguous or nonresponsive information.
However, you must state in writing what additional information is necessary and provide additional time if an employee notifies you within the seven-day period that he or she cannot obtain the additional information despite "diligent good faith efforts" to do so. The proposed rules further explain it is the employee's responsibility to provide complete, sufficient certification or authorize his or her health care provider to release sufficient and complete certification to support the request for FMLA leave.
Although this change would permit you to communicate directly with health care providers (as long as the requirements of medical privacy regulations are met), you still would not be permitted to ask for any information beyond that required by the certification form. If an employee ultimately provides an incomplete or insufficient certification, the effect is the same as a failure to provide certification, which permits a denial of FMLA leave.
Consistent with employer concerns about the sufficiency of information often provided in certifications, the new regulations also would require employees to disclose their health care providers' specializations and fax numbers in addition to previously required identifying information.
Substantively, the proposed rule would require a certification to contain "sufficient medical facts" of an employee's health condition, including such information as symptoms, history of hospitalization and doctors visits, prescriptions, any referrals for evaluation and/or treatment, and any other recommended regimen. In addition, health care providers may (but do not have to) provide information regarding the employee's diagnosis. The provided information must establish the employee's inability to perform job functions and indicate the likely duration of this inability.
Serious health condition
The proposed changes also reflect numerous challenges to the regulation defining the term "serious health condition" as a condition causing a period of incapacity of more than three consecutive calendar days and requiring continuing treatment.
The six current definitions of "serious health condition" and the objective test for continuing treatment currently in place have been criticized for being unnecessarily vague and confusing and also for the perceived lack of seriousness inherent in certain conditions the definition covers. Indeed, DOL admitted in explaining the revised regulations that it, too, struggled with the terms used to define serious health condition. As a result of the ambiguities, the public urged DOL to do the following:
These suggestions stemmed directly from employers' frustration with what they identified as the "weekend" FMLA problem (their inability to know or verify that employees who call in sick on Friday or Monday claiming an FMLA absence are entitled to FMLA leave). Indeed, DOL noted no issue received more substantive commentary than employee use of unscheduled intermittent leave, which typically is based on recurring episodes of minor health conditions, giving employees opportunities to misuse FMLA leave to take vacations or long weekends when they otherwise would not be able to do so.
Nevertheless, DOL rejected suggestions to redefine "serious health condition," explaining it could not identify a better alternative to the current definition, particularly considering medical conditions that are benign to some may be truly incapacitating to others.
However, DOL proposed a new structure for the definition designed to clarify the definition and provide employers and medical practitioners with better guidance to determine whether a health condition qualifies for FMLA coverage.
In the proposed regulations, a serious health condition continues to be defined as an illness, injury or impairment that involves inpatient care or continuing treatment but is set forth in a separate regulation as are the definitions of "inpatient care" and "continuing treatment." But without any changes to the definition, the problems associated with FMLA abuse by employees suffering from relatively minor conditions have not been addressed.
DOL at least clarified what it means to suffer from a "period of incapacity of more than three consecutive calendar days" by explaining that its new regulations require at least two visits to a health care provider during a period of incapacity within 30 days of the period of incapacity beginning (unless extenuating circumstances exist) instead of the current regulation's completely open-ended time frame.
This means that if an employee visits a physician and is told not to report to work for more than three days because of a health condition but is not prescribed any medication, whether the condition is considered a serious health condition under FMLA will depend on whether the health care provider determines additional follow-up treatment is needed within 30 days of the beginning of the initial period of incapacity.
So if an employee does not need a follow-up appointment for two months, the condition would not be considered a serious health condition. On the other hand, if the physician schedules a follow-up appointment two weeks after the initial visit, the condition would be considered a serious health condition. With the current regulations, an employee could visit his or her doctor on one occasion, suffer three days of incapacity, visit his or her doctor five months later and still be deemed to be suffering from a serious health condition. The proposed regulations serve to prevent employers from making quick judgments that deny FMLA leave when employees otherwise qualify.
Intermittent leave
DOL recognizes the enormous burden imposed on employers under the current regulations by having to allow employees to take intermittent or reduced schedule leaves in increments as small as a payroll system will capture, particularly when leave is unscheduled and an employee only needs to leave for a few hours during the middle of a shift when his or her work is not conducive to such absences.
For instance, a machine operator could use intermittent FMLA leave to miss 15 minutes in the middle of a heavy production run to which he was assigned, causing his employer to cease production—or at least temporarily suspend it—to call in a replacement worker. The machine operator could then return to production, which leaves the employer with the dilemma of what to do with the surplus of workers.
The problem would be exacerbated if the machine operator consistently leaves at times when work is heaviest, allowing him to avoid the most difficult work. DOL attempts to address such situations, in part, by requiring in its proposed rules that employees taking intermittent leave because of medical necessity must now make a "reasonable effort" (as opposed to a mere "attempt") to schedule leave so as not to unduly disrupt operations. But DOL does not define "reasonable effort."
Moreover, DOL refused to increase the minimum increment of intermittent leaves in its new rules and instead is seeking comments from the public concerning the universally challenging issue, including suggestions for specific language that should be included in the final regulations.
Employee eligibility
The proposed regulations clarify in what circumstances an employee's prior service must count toward the eligibility requirement that the employee must have worked 12 months to qualify for FMLA leave. Under current rules, the 12 months of service do not need to be consecutive. The rules also do not impose any time restrictions, requiring employers to consider any prior service by the employee.
Aiming to strike a balance between these competing concerns, the proposed regulations provide that employment periods preceding a break in service of more than five years need not be counted. However, such time would be counted if the break is the result of National Guard or reserve military service obligation or if the parties have a written agreement that the employee would be rehired following a break in service.
But because FMLA requires covered employers to maintain records for only three years, it will be incumbent on employees to prove prior employment if an employee relies on a period of employment that predates the employer's records.
Notwithstanding this burden on employees, it may be prudent—if this new regulation survives—for you to retain separate records documenting the dates of employment for former employees to track their FMLA eligibility in the event they are rehired.
The proposed rules also address confusion about whether leave time could count toward fulfilling the requirement of 12 months of service. The proposed regulations explain that though the leave time counts toward the service requirement, employee eligibility must be determined on the date leave commences.
This means, for instance, that if an employee has fulfilled the 1,250 hours requirement but has worked only 11 consecutive months when she goes on leave for the birth and bonding of a newborn, the first month of leave is non-FMLA leave. But one month later she meets the 12-month eligibility requirement, and, thereafter, the period of leave would be considered FMLA-protected leave.
Substitution of paid leave
Current regulations allow you to require employees to comply with your policies for requesting and taking paid sick and medical leaves when an employee wishes to substitute such paid leave for FMLA leave. However, DOL has interpreted the current regulations as requiring employers to allow employees, upon request, to substitute paid vacation and personal leave (as opposed to paid sick or medical leave) for unpaid FMLA leave even if an employee has not complied with the employer's rules for requesting and taking such leave.
The proposed regulations clarify that when substituting any type of paid leave for FMLA leave, an employee is entitled to the paid leave only if he or she qualifies for the leave under the employer's paid leave policy and adheres to that policy for requesting and taking the paid leave.
However, if an employee receives paid disability leave concurrently with FMLA leave, you may not require the employee to also use other types of paid leave, such as vacation. You and the employee may agree to use such additional paid leave time to the extent necessary to supplement any shortfall between the disability payments and employee's typical earnings.
Moreover, under the proposed regulations, when notifying an employee of his or her eligibility for FMLA leave, you would have to affirmatively notify the employee of any additional requirements for the substitution of paid leave and inform the employee he or she still is eligible for unpaid FMLA leave even if the employee opts not to fulfill the additional requirements for paid leave.
Consistent with the current regulations, the proposed regulations state you may only require an employee to substitute paid leave for FMLA leave if the employee has accrued and is eligible for the paid leave at the time FMLA leave is taken.
Finally, the proposed regulations also remove language in the current regulations that prohibits you from requiring an employee to comply with FMLA procedural requirements for requesting and qualifying for leave if you have less stringent procedural requirements for taking paid leave. DOL has determined the current regulations conflict with FMLA and that all employees seeking FMLA leave may be required by employers to fulfill FMLA requirements even if an employer has less stringent requirements for requesting other paid leaves.
Failure to pay premiums
Currently, you may allow an employee's health insurance to lapse during FMLA leave (after a grace period and notifying the employee) if an employee fails to pay the employee portion of health insurance premiums while on FMLA leave. The proposed regulations make clear that if you allow such coverage to lapse, you still have a duty to reinstate the coverage upon the employee's reinstatement and can be liable to the employee for any damage suffered by a failure to reinstate the coverage.
DOL stresses employers should consider keeping an employee's health coverage current and attempting to recoup any unpaid premiums in other ways, such as payroll deductions, if allowed.
Although employers and employees are free to enter into agreements that state an employee will be responsible for repaying any unpaid premiums, many state wage laws prohibit employers from actually deducting such costs directly from an employee's wages unless consent is given at the time of the deduction, making it difficult for employers to recoup such costs short of going to court to enforce the agreement.
You will need to carefully document all communications with employees concerning health insurance coverage during FMLA leave and be certain your FMLA policies clearly spell out employees' payment obligations during that time.
Perfect attendance bonuses
DOL proposes changing the treatment of perfect attendance awards and other bonuses/incentives related to attainment of certain goals to allow employers to deny such bonus awards to employees who have not reached those goals because of FMLA leave as long as employees taking non-FMLA leave are treated identically.
This addresses the unfairness perceived by employees and employers alike as a result of the current regulations' mandate that employees who are absent for FMLA leave remain eligible for perfect attendance and other nonproduction-related bonus or incentive systems.
Therefore, under the new regulations, if you maintain a blanket policy denying perfect attendance bonuses to any employee who—but for some form of approved leave under your policy—would have had perfect attendance, you may deny the bonus to similarly situated employees on FMLA leave.
Other noteworthy changes
The proposed regulations require employees to comply with their employers' absence-reporting policies and procedures except in extraordinary circumstances. For example, though an employee undergoing emergency treatment may be unable to call the office, an employee who experiences a flare-up of a chronic condition at home can and should call in. Under the proposed regulations, failure or delay in compliance will lead to discipline under regular disciplinary procedures and a delay of FMLA coverage. The proposed regulations clarify that any unprotected leave taken before FMLA leave cannot be counted against FMLA leave.
The new rules also address the effect of employees' delays in providing notice of FMLA leave. If an employee gives a one-week notice and two weeks are required, you may delay FMLA leave for one week.
In addition, whether an adult child has a disability for purposes of FMLA coverage should be determined at the time leave is to commence and cannot be based on facts and circumstances that occur after the leave commences.
If an employee is required to present documentation of a qualified family relationship, a submitted and signed tax return may be used as evidence because, in the case of an in loco parentis relationship, it may be difficult to determine what kind of proof may be reasonable to establish such a relationship. If an employee opts to present a personal statement attesting to a qualified family relationship, his or her statement must be sworn and notarized.
An employee who needs to care for a family member need not be the only individual or family member available to care for the qualified family member.
Holidays are another issue the proposed changes address. When a holiday falls during an FMLA leave and the employee would not be required to be at work because of the holiday:
For example, say an employee has a work schedule of Monday through Friday and Friday is a holiday on which the employee would not typically be required to report to work. If the employee needs FMLA leave only for Wednesday through Friday, the employee would use only two days of FMLA leave.
The proposed regulations also clarify that employees may waive (through settlement or separation agreements) their claims to previous FMLA violations (but not prospective violations) without DOL or court supervision of such waivers. This change is in response to federal court rulings interpreting the current regulations to prohibit any waiver—either retrospective or prospective—of FMLA rights without court or DOL supervision.
The proposed regulations seek to clarify that if an employee voluntarily accepts light-duty work instead of taking FMLA leave, the time spent in the light-duty assignment does not count against FMLA leave entitlement nor does it affect the employee's right to job restoration under FMLA.
Current regulations allow you to require a fitness-for-duty certification before an employee returns to work following FMLA leave as long as you maintain a uniformly enforced policy requiring such certifications for all other similarly situated employees.
The proposed regulations make two changes to the process:
Update your policy
DOL has proposed countless other changes not mentioned here, and though the regulations are not in final form, substantive changes to FMLA regulations are inevitable.
If you are covered by FMLA, we advise you to immediately modify your FMLA policy to include the new service member family leave entitlements for military families and closely monitor the status of the yet-to-be-released DOL regulations to ensure timely updates to your policies and practices.
Victoria L. Donati and Jason C. Kim are partners in the employment law group of the Chicago-based law firm Neal, Gerber & Eisenberg LLP.
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