Question: What are the considerations/ramifications when deciding to pay an employee on Family and Medical Leave Act (FMLA) leave, other than vacation/personal days?
Answer: If the company has a paid time off (PTO)/vacation/sick policy, we recommend that the company allow the employee to utilize any accrued paid time while on leave of absence. This allows the employee to receive wages while not working, which is viewed as a valued benefit for the employee.
When an employee is on either a workers’ compensation (WC) or short term disability (STD) benefit leave, the employer may wish to coordinate the PTO/vacation/sick wages with the WC or STD wages.
When considering paying an employee his or her regular salary while on leave, some things to consider may include:
- The policy is extended equally and consistently for all employees requesting FMLA leave.
- Wages are coordinated with any other supplemental income such as WC and STD.
- Is pay considered for non-FMLA leaves? For how many weeks?
- Continuance of pay is or is not provided when the leave of absence extends beyond the 12 weeks of FMLA?
- Can the company afford continued wage payments for employees who are not at work producing?
- How will this integrate with any current paid vacation/sick/PTO policy currently in place?
- If the company suffers financial hardship and may be requiring layoffs, how will this affect those employees on paid leave (you cannot lay off a person on FMLA just because you do not want to continue to pay them)?
- If the company chooses to hire a temporary employee to replace the employee on leave of absence, can the company afford to pay both wages to cover one job?
- How will the company pay employees who work varied hours each week?
There may be additional considerations to think about. We generally do not advocate offering paid leave of absence beyond a bona fide paid vacation/sick/PTO policy the company may have in place.
We do recommend reviewing any new policies with legal counsel prior to implementation to ensure the company is aware of all legal ramifications.