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Coverage

The FMLA permits eligible employees of a covered employer to take job-protected, unpaid leave, or to substitute certain earned or accrued paid time off, for up to a total of 12 workweeks in any 12 months because of the birth of a child and to care for the newborn child, because of the placement of a child with the employee for adoption or foster care, because the employee is needed to care for a family member (child, spouse, or parent) with a serious health condition, because the employee’s own serious health condition makes the employee unable to perform the functions of his or her job, or because of any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on active duty (or has been notified of an impending call or order to active duty) in support of a contingency operation. In addition, eligible employees may take job protected, unpaid leave, or substitute appropriate paid leave if the employee has earned or accrued it, for up to a total of 26 workweeks in a “single 12-month period” to care for a covered servicemember with a serious injury or illness.

In certain instances, FMLA leave may be taken on an intermittent basis rather than all at once, or the employee may work a part-time schedule. An employee on FMLA leave is also entitled to have his/her health benefits continued while on leave as if he/she had continued to work instead of taking the leave. Generally, an employee will be able to continue paying no more than his/her regular employee contribution toward the health benefits plan while on leave. An approved leave under the FMLA is not a qualifying event under COBRA. The employer may recover its share only if the employee does not return to work for a reason other than the serious health condition of the employee or the employee’s covered family member, the serious injury or illness of a covered servicemember, or another reason beyond the employee’s control.

An employee generally has a right to return to the same or equivalent position with equivalent pay, benefits, and working conditions at the conclusion of the leave. Generally, the taking of FMLA leave cannot result in the loss of any benefit that accrued prior to the start of the leave.

For the most part, an employer has a right to advance notice from the employee. In addition, the employer may require an employee to submit certification to substantiate that the leave is due to the serious health condition of the employee or the employee’s covered family member, due to the serious injury or illness of a covered servicemember, or because of a qualifying exigency. Failure to comply with these requirements may result in a delay in the start of FMLA leave. Pursuant to a uniformly applied policy, the employer may also require that an employee present a certification of fitness to return to work when the absence was caused by the employee’s own serious health condition. The employer may delay restoring the employee to employment without such certificate relating to the health condition which caused the employee’s absence.

Employers

Covered Employer

An employer under the FMLA is one who is engaged in commerce or in any industry or activity affecting commerce that employs 50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year. Employers covered by FMLA also include any person acting, directly or indirectly, in the interest of a covered employer to any of the employees of the employer, any successor in interest of a covered employer, and any public agency. Public agencies are covered employers without regard to the number of employees employed. Public as well as private elementary and secondary schools are also covered employers without regard to the number of employees employed.

For purposes of the FMLA, employers who meet the 50 employee coverage test are deemed to be engaged in commerce or in an industry or activity affecting commerce.

Most of the time, the legal entity that employs the employee is the employer. Thus, a corporation is a single employer rather than its separate establishments or divisions. But, where one corporation has an ownership interest in another corporation, it is a separate employer unless it satisfies the requirements of “joint employment” or “integrated employer” status. When integrated employment status is found, the employees of all of the entities that are integrated will count in determining coverage and employee eligibility. Factors considered in determining whether two or more entities are an integrated employer include, a) common management, b) interrelation between operations, c) centralized control of labor relations, and, d) degree of common ownership/financial control.

Unfortunately for those in senior management, the definition of “employer” under the FMLA includes persons who act directly or indirectly in the interest of the employer. This definition is similar to the definition of employer under the Fair Labor Standards Act. Thus, individuals such as corporate officers “acting in the interest of an employer” can be individually liable for any violations of the FMLA.

Counting Employees

One is considered an employee under the FMLA in much the same way one would be considered an employee under the Fair Labor Standards Act. While many think of common law or other definitions, the FMLA uses the concept of “to suffer or to permit to work.” This is a relatively low threshold and simple knowledge of work done for the employer can be enough for an employee to be considered an employee under the FMLA. In addition, any employee whose name appears on the employer’s payroll will be considered employed each working day of the calendar week, and must be counted whether or not any compensation is received for the week. But, it is important to remember that the FMLA only applies to employees who are employed within the United States or its territories.

Employees on paid or unpaid leaves are counted as long as the employer has a reasonable expectation that the employee will return to work. If the employee has been laid off (even if subject to recall), the individual is not counted. Part-time employees, like full-time employees, are considered to be employed each working day of the calendar week, as long as they are maintained on the payroll. But, an employee who does not begin work for an employer until after the first working day of a calendar week, or who terminates employment before the last working day of a calendar week, is not considered employed on each working day of that calendar week.

Private employers are covered if they maintained 50 or more employees on the payroll during 20 or more calendar workweeks (not necessarily consecutive workweeks) in either the current or the preceding calendar year. Once a private employer meets the 50 employees/20 workweeks threshold, the employer remains covered until it reaches a future point where it no longer has employed 50 employees for 20 (nonconsecutive) workweeks in the current and preceding calendar year. The regulations provide the following example to illustrate this point: if an employer who met the 50 employees/20 workweeks test in the calendar year as of September 1, 2008, subsequently dropped below 50 employees before the end of 2008 and continued to employ fewer than 50 employees in all workweeks throughout calendar year 2009, the employer would continue to be covered throughout calendar year 2009 because it met the coverage criteria for 20 workweeks of the preceding calendar year.

Joint Employers

Two or more businesses that exercise some control over the work or working conditions of the employee may be considered joint employers under the FMLA. These joint employers may even be separate and distinct entities with separate owners, managers, and facilities. Where the employee performs work which simultaneously benefits two or more employers, or works for two or more employers at different times during the workweek, a joint employment relationship generally will be considered to exist in situations where, a) the employers have an arrangement to share an employee’s services or to interchange employees, b) one employer acts directly or indirectly in the interest of the other employer in relation to the employee, or, c) the employers are not completely disassociated with respect to the employee’s employment and may be deemed to share control of the employee, directly or indirectly, because one employer controls, is controlled by, or is under common control with the other employer.

Joint employment will ordinarily be found when a temporary placement agency supplies employees to a second employer. Whether a Professional Employer Organizations (PEO) can be found to have joint employer status with a client employer depends upon the facts and circumstances of the relationship with the client employer. When a PEO performs merely administrative functions, joint status will not be typically found. But, if the PEO has the right to hire, fire, assign, or direct and control the client’s employees, or benefits from the work that the employees perform, such rights may lead to a determination that the PEO would be a joint employer with the client employer, depending upon all the facts and circumstances.

When joint employment status is found, the primary employer is the one that is obligated to give required notices and maintain...