As we noted Monday, the Department of Labor (DOL) published its long-awaited final regulations implementing the Family and Medical Leave Act (FMLA) last Friday. The new rules will become effective January 16, 2009.
Most of the changes in the new regulations were foreshadowed when the DOL first released a set of proposed amendments in February 2008. Although the final regulations differ in significant ways from the original regulations drafted in 1995 by the previous presidential administration, they have stayed pretty consistent with the amendments proposed earlier this year. There are a few new beneficial tools for employers, but there are some new obligations as well.
The most important changes for employers are summarized below, listed in roughly the order they appear in the final regulations.
Joint Employer Definition –
The final regulations contain new language clarifying that a joint employer relationship generally does not arise from “Professional Employer Organizations” in instances where the PEO “merely performs … administrative functions.” However, in circumstances where a PEO or vendor actually has the right to hire, fire, and assign work, a joint employer relationship is still likely to exist, “based on all the facts and circumstances.” 29 CFR § 825.106(b)(2).
Employee Eligibility –
To be eligible for FMLA protection, an employee must have worked with an employer for at least 12 months and for at least 1,250 hours in the last 12 months. According to the final regulations, when measuring the 12-month requirement, employers are no longer required to count work performed before a break in service lasting seven years or more (a change from the proposed regulations, which had originally indicated that a five-year gap would be sufficient to disrupt eligibility). The final regulation provides that time for military service is not to be included in any gap determination. 29 CFR § 825.110(b).
Similarly, the hourly requirement has been rewritten, in keeping with USERRA, so that if an employee would have met the 1,250 hours to qualify but for intervening military service, he or she remains eligible for FMLA. 29 CFR § 825.110(c)(2).
The final regulations retain the proposed change clarifying that employees who become eligible for FMLA protection while in the middle of non-FMLA leave may automatically acquire FMLA protection. Leave that begins before FMLA eligibility may start out as “non-FMLA” qualifying leave, but if an employee becomes eligible for FMLA leave in the midst of the absence, FMLA protections are triggered from that point forward. 29 CFR § 825.110(d).
Serious Health Condition –
The final regulation retains the six familiar definitions for “serious health condition” contained in the 1995 original, though it adds a couple of clarifications.
One form of serious health condition involves an incapacity of more than three days and either (a) two visits with a health care provider (e.g., doctor) or (b) one such visit with a regimen of continuing treatment. The final regulations clarify that the first option only protects absences involving two or more doctor visits “within a 30-day period” and that both options require an “in-person” doctor visit within seven days of the onset of leave. 29 CFR § 825.115(a)(3).
The definition for “chronic condition,” another form of serious health condition, now requires that employees continue to visit a health care provider at least twice per year to qualify. 29 CFR § 825.115(c)(1).
Placement of Adopted Child –
FMLA leave is available for the placement of adopted children. The final regulations retain the proposed clarification that FMLA leave may include time to “travel to another country to complete an adoption.” FMLA eligibility is not affected by the “source of the adopted child.” 29 CFR § 825.121(a)(1).
Health Care Provider –
The long list of health care providers already eligible to prepare FMLA medical certifications and treat employees has been expanded by the final regulations to include “physician’s assistants.” 29 CFR § 825.125(b)(2).
Intermittent Leave –
Unfortunately, the final regulations still provide no useful guidance or changes regarding intermittent leave, despite widespread confusion and requests for clarification from employers. Whereas the 1995 regulations included a statement that employees must “attempt” to schedule their intermittent leave so as not to “disrupt” the employer’s operations, the final regulations clarify that an employee “must make a reasonable effort” to schedule treatments so as not to “disrupt unduly” the employer’s operations. 29 CFR § 825.203. This appears to be a distinction without a difference.
Under the final regulations, where an employee takes a full week of FMLA leave, the fact that a holiday may occur within the week does not affect how much of an employee’s 12-week FMLA allowance has been used – the week is still counted as a full week of FMLA leave. However, if an employee is using FMLA leave in increments of less than one week, the intervening holiday will not count against the employee’s 12-week entitlement unless the employee was otherwise scheduled and expected to work during the holiday. 29 CFR § 825.200(h).
Attendance Bonus –
The 1995 regulations specifically required that employee bonuses based solely on attendance not be denied employees based solely on their absences related to FMLA leave. The final regulations now state that bonus awards can be properly based on the “achievement of a specified goal such as hours worked, products sold or perfect attendance” and therefore can be denied employees who have taken FMLA leave. However, FMLA leave and similar non-FMLA leaves must be treated the same for purposes of such bonuses. 29 CFR § 825.215(c)(2).
Light Duty –
The FMLA permits an employer and employee to agree to a “light duty” schedule that allows the employee to continue working rather than take unpaid FMLA leave. Under the 1995 regulations, such light duty time could be counted against the employee’s 12-week FMLA allowance, even though it technically was “working time” for the employee. This provision has been entirely deleted from the final regulations so that now employees who accept light duty work need not exhaust any FMLA leave to do so. Employees may not be required to work light duty jobs in lieu of taking leave, and those who do so voluntarily are not on FMLA leave. 29 CFR § 825.207(e).
Waiver of Rights –
The 1995 regulations indicated that “[e]mployees cannot waive, nor may employers induce employees to waive, their rights under FMLA.” Some courts had construed this language as prohibiting settlement agreements and other retroactive waivers without DOL or court approval. The final regulations insert the word “prospective” before the word “rights,” and include an express provision permitting “the settlement or release of FMLA claims by employees based on past employer conduct without the approval of the Department of Labor or a court.” 29 CFR § 825.220(d).
Employer Notices –
And you thought your FMLA administration was already a bureaucratic nightmare. The final regulations now provide for four separate types of FMLA notice that must be provided by employers to employees: (1) “general notice” of employee FMLA rights, (2) “eligibility notice” to employees requesting FMLA leave, (3) “rights and responsibilities notice” to employees, and (4) “designation notice” indicating whether a given absence qualifies for FMLA leave.
“General notice” includes the conspicuous placement of the familiar poster listing employees’ FMLA rights, but the final regulations also include a requirement that new employees be separately apprised of their FMLA rights in writing, in an employee handbook or otherwise “upon hiring.” 29 CFR § 825.300(a).
“Eligibility notice” is largely a new concept in the final regulations. When an employee requests (or the employer identifies) a potential FMLA-qualifying leave for the first time during the applicable 12-month period, the employer must notify the employee of their FMLA eligibility status within 5 business days. If the employee is not eligible for FMLA leave, the notice must state “at least one reason” why the employee is ineligible. If the employee’s eligibility does not change by the next time FMLA leave is requested, no new eligibility notice needs to be provided. 29 CFR § 825.300(b). While eligibility notice may be provided by the employer orally or in writing, an approved form for this eligibility notice is provided by the DOL in an appendix to the final regulations.
“Rights and responsibilities notice” must be provided to employees in writing, detailing the employer’s expectations and any consequences of the employee’s failure to meet these expectations under the FMLA. Such notice must be provided with the “eligibility notice” described above and must include: (1) an explanation that if FMLA leave is granted it will be deducted from the employee’s 12-week allowance, (2) requirements for employees to submit medical certifications and the consequences for failing to do so, (3) any employer requirements regarding the substitution of paid leave such as sick time or vacation, (4) requirements for employee to maintain health benefits during FMLA leave, including payment of premiums, (5) key employee status, if applicable, (6) employee rights to maintain benefits and to job restoration following leave, and (7) the employee’s potential liability for unpaid health insurance premiums if the employee fails to return to work following leave. 29 CFR § 825.300(c). An approved prototype “rights and responsibilities notice” is provided by the DOL in an appendix.
“Designation notice” must be provided by employers in writing within five days (the analogous requirement in the 1995 regulations had required such notice within two days) after obtaining sufficient information to know whether a given absence is FMLA-qualifying or not. If leave is granted, the designation notice must include any “fitness-for-duty” certification that may be required by the employer before returning the employee to work. It also must specifically inform the employee of the amount of leave – “hours, days or weeks” – that will be deducted from the 12-week FMLA allowance. If this breakdown is unknown at the time the leave is granted (e.g., where the amount of leave is unforeseeable or sporadic), the employer must provide such information upon an employee’s request, but the employer need not provide such breakdowns more often than every 30 days. 29 CFR § 825.300(d). Again, an approved prototype “designation notice” is provided by the DOL in an appendix.
Employee Notice of FMLA-Qualifying Absence –
In a new development, the final regulations note the general rule that an employee need not mention the FMLA by name, but limit this freedom to circumstances “[w]hen an employee seeks leave for the first time for an FMLA qualifying reason.” However, once FMLA leave has been granted for an employee’s health condition, the employee must thereafter “specifically reference either the qualifying reason or the need for FMLA leave.” 29 CFR § 825.303(b).
The final regulations expressly clarify that an employee cannot merely call in “sick” and thereby trigger an affirmative duty for the employer to inquire further about whether the absence might be FMLA-qualifying. 29 CFR § 825.303(b).
The final regulations specify that even for unforeseeable leaves, it should be “practicable” for employees to request leave “either the same day or the next business day.” 29 CFR § 825.302(b).
Employer’s Usual and Customary Procedures –
Under the final regulations, when the need for leave is not foreseeable, an employee must comply with the employer’s usual and customary notice and procedural requirements for requesting leave, absent unusual circumstances. Specifically, the new regulations generally permit employers to require employees to follow established call-in procedures (except ones that impose more stringent timing requirements than the regulations provide), and they provide that failure to properly notify employers of absences may cause a delay or denial of FMLA protections. 29 CFR § 825.302(d). Employers may require employees seeking FMLA leave to call a “designated number or a specific individual to request leave.” 29 CFR § 825.303(c). Under the 1995 regulations, an employer could not delay or deny FMLA leave if an employee failed to follow such procedures.
Medical Certification –
The final regulations include new approved medical certification forms, including separate forms for the serious health conditions of employees and those of family members. To streamline the processing of certifications, the final regulations allow health care providers to include medical facts about diagnoses, symptoms, hospitalization, doctors’ visits, prescription medication, referrals for evaluation or treatment (physical therapy, for example), or any other regimen of continuing treatment.
Employer Contacts with Health Care Providers –
The 1995 regulations prohibited direct contact between employers and health care providers in most instances. The new final regulations carve out an exception, allowing employers to contact physicians directly “[i]f an employee’s serious health condition may also be a disability within the meaning of the Americans with Disabilities Act,” so long as the more liberal restrictions of the ADA are observed. 29 CFR § 825.306(d). (Under the old and new regulations, employers may also contact employees in accordance with state workers’ compensation laws.)
The final regulations also permit an employer to make direct contact with the employee’s physician to seek “clarification and authentication” of medical certifications. Previously, only another physician hired by the employer could make such inquiries. However, in a change from the proposed amendments, the final regulations require that employers initiate such contacts only through “a health care provider, a human resources professional, a leave administrator, or a management official.” Importantly, “[u]nder no circumstances … may the employee’s direct supervisor contact the employee’s health care provider.” 29 CFR § 825.307(a).
While the employee is not required to permit his or her doctor to communicate with the employer, the employer may deny the designation of FMLA leave for failure to consent. 29 CFR § 825.307(a).
The final regulations change and clarify an employer’s right to obtain recertification for a serious health condition. As with the 1995 regulations, an employer may require recertification no more than every 30 days, unless the circumstances of the leave change or the employer receives information that casts doubt on the legitimacy of the original certification. Under the final regulations, if the medical certification indicates that the underlying condition will last more than 30 days, the employer may not request recertification until that minimum duration has passed. In all cases, however, even where a medical certification indicates that the underlying condition is a “lifetime condition,” employers may always require recertification every 6 months in connection with an absence. 29 CFR § 825.308. These changes significantly clarify the old rule.
Fitness-for-Duty Certification –
The final regulations permit an employer to require that an employee obtain a certification from his or her health care provider that the employee is fit to resume work following FMLA leave. The employer may provide the employee with a list of the employee’s essential job duties together with the designation notice, described above, in which the employer originally advises the employee of the necessity for a fitness-for-duty certification. If the employer provides such a list of essential functions, it may require the employee’s health care provider to certify that the employee can perform them. When completing a fitness-for-duty certification, the health care provider therefore must assess the employee’s ability to return to work against the identified essential functions. 29 CFR § 825.312(b).
While the general restriction on obtaining a new fitness-for-duty certification following each intermittent leave event remains intact, the final regulations carve out an exception: an employer is entitled to a certification of fitness to return to duty for intermittent absences up to once every 30 days if “reasonable safety concerns” exist regarding the employee’s ability to perform his or her duties. 29 CFR § 825.312(f).
FMLA Leave for Military Families –
A substantial portion of the final regulations is dedicated to providing first-time guidance on this year’s amendment to the FMLA to provide leave for employees who need time to fulfill military duties or to care for family members in the military.
The final regulations extend FMLA protection to employees who are needed to care for family members in the military with a serious injury or illness incurred in the line of duty. Likewise, the amendment allows families of National Guard and Reserve personnel on active duty to take FMLA job-protected leave in order to manage activities associated with their service, known as “qualifying exigencies.”
The final regulation defines “qualifying exigencies” as: (1) short-notice deployment, (2) military events and related activities, (3) childcare and school activities, (4) financial and legal arrangements, (5) counseling, (6) rest and recuperation, (7) post-deployment activities, and (8) additional activities to which the employer consents. 29 CFR § 825.126(a).
Employees eligible for leave under both of these new initiatives are permitted to take up to 26 weeks of leave in a 12-month period. This leave may be taken separately from more conventional FMLA (i.e., for serious health conditions), so long as conventional FMLA leave does not exceed 12 weeks and the total leave does not exceed 26 weeks in the 12-month period. The final regulations include definitions for employee coverage and for certification of qualifying events giving rise to the leave.
Unfortunately for the purposes of quick analysis, the new military leave provisions are intertwined throughout the existing regulations dealing with serious health conditions. We will provide a more detailed analysis of these provisions in the near future.