Under the Family and Medical Leave Act, you can generally require that employees use their accrued paid vacation, sick or family leave to cover some or all of their FMLA leave period. Even if you do not mandate this substitution, the FMLA generally permits employees to make the election on their own. However, there are some conditions and exceptions to consider.
FMLA Notice of Eligibility and Rights & Responsibilities
When employees request FMLA leave, you must tell them — via the Notice of Eligibility and Rights & Responsibilities — whether they are eligible or ineligible for the time off. If they are eligible and will be required to use their paid vacation, sick or family leave, you must state this in the notice.
PTO and FMLA run concurrently
In an opinion letter dated March 14, 2019, the Department of Labor responded to a query regarding whether employers can allow employees to exhaust their paid leave before dipping into their FMLA leave. According to the DOL, this practice is not acceptable, as the paid leave must run concurrently with the unpaid FMLA leave.
This means employees cannot tap into their paid vacation, sick or family leave before using their unpaid FMLA leave, nor can they save up their unpaid FMLA leave time by taking paid leave first.
If the paid leave is being taken for an FMLA-qualifying reason, then the leave is protected under the FMLA and should be designated as such. You must designate the time off as FMLA leave within five days of determining that the leave is being taken for an FMLA-qualifying reason.
Applying paid time off to FMLA leave
Regardless of whether you require that the employee use PTO while on FMLA leave or whether the employee makes that choice, he or she should receive his or her paid leave based on your paid leave policy. Further, the paid leave should be counted against the 12 weeks of unpaid FMLA leave that the employee is entitled to for the year.
Exceptions to the rule
Under the FMLA, you cannot require that employees use paid leave, nor can employees make that election, if they’re getting benefits through a wage replacement program, such as workers’ compensation or disability insurance. The rationale is that the substitution of paid leave pertains only to unpaid FMLA leave. Therefore, you cannot require that employees also take paid leave if they’re already receiving workers’ compensation or disability insurance while on unpaid FMLA leave.
Wage replacement programs typically cover only a portion of employees’ wages. However, if authorized by state law, you and the employee may agree to use paid leave to make up wage replacement shortages.
The issue of employees taking PTO during FMLA leave is quite complex, so be sure to seek legal counsel before creating related policies and procedures.