Maintaining benefits during a leave

If you provide group health plan coverage for employees, you are required to maintain them for an employee on FMLA leave under the same conditions as if the employee is continuously employed during the leave. Examples of health coverage include: medical, surgical, hospital, dental and eye care, mental health counseling, substance abuse treatment, supplemental health coverage and health coverage provided through a flexible spending account or cafeteria plan. An employee's ability to maintain other benefits (e.g., life or disability benefits) during FMLA leave depends on your established policy for providing these benefits when employees are on other forms of paid or unpaid leave. If these benefits are not maintained, however, you must reinstate the employee to the same level of benefits that he or she would have had if continuously employed.

You cannot require employees returning from FMLA leave to requalify for any benefits they had before taking FMLA leave, including dependent coverage.

If you do maintain other benefits during an FMLA leave, you may recover the costs of paying the employee's share of any premiums, even if he or she doesn’t return to work.

A provision in Unum's group insurance contracts can simplify benefits continuation. See Part 6 of this handbook for more information.

Health benefit premium responsibility

For employer-paid health premiums, you must continue the same payment of premiums during FMLA leave. For shared or employee-paid health premiums, this arrangement must continue during FMLA leave.

When employees request FMLA leave, provide written advance notice of the terms and conditions of their premium payments in the required specific notice to employees described in Part 1 of this handbook.

For employees on paid leave, premium payments continue in the normal manner, usually payroll deductions.

For employees on unpaid leave, you can require employees to pay premiums directly to you or the insurance company. You can require employees to pay premiums to you using one of the following methods:

• pay premiums on the days they would be due if payroll deducted;
• use the same premium schedule as for COBRA beneficiaries;
• prepayment under a cafeteria plan (at the employee's option);
• under the same payment rules as employees on other leaves without pay (provided policy does not require prepayment or higher premiums than if the employee had continued to work); or
• any mutually agreeable payment arrangement.

When employees make late premium payments

If the premium payment is more than 30 days late and you don't have an HR policy with a longer grace period, the FMLA doesn't require you to continue coverage.

However, before you end coverage, verify whether the benefit plan allows you to reinstate the employee's current coverage with no penalty immediately upon the employee’s return from FMLA leave.

If so, give the employee written notice that the payment wasn't received. This notice must be mailed to the employee at least 15 days before the coverage is scheduled to end. In it, specify the date that coverage will end if a payment isn't received. After the 15-day notice is given, you can end coverage retroactively to the date the premium was due if you have a policy for doing the same for other unpaid leaves. Without this kind of HR policy in place, you can end coverage at the end of the 30-day grace period as long as you’ve given the 15-day notice.

Job restoration upon return from leave

When an employee returns to work immediately after an FMLA leave ends, you must:

• without penalty, reinstate all benefits that weren't continued during the leave; and
• restore the employee to his or her original job or one with equivalent pay, benefits and other employment terms and conditions.

Benefits upon return: Benefits must be immediately reinstated at the same level as before the leave, without any qualifying requirements like waiting periods, pre-existing condition restrictions or medical underwriting. This is true even if the coverage lapsed because the employee failed to make required premium payments during the FMLA leave.

For pensions or retirement plans, unpaid FMLA leaves can’t be counted as a break that might affect vesting or participation.

Position requirements upon return: When an employee returns from an FMLA leave, you must restore the individual to an equivalent position. This is a position with the same pay, benefits and working conditions (including privileges, prerequisites and status), involving the same or substantially similar duties and responsibilities and requiring substantially equivalent skill, effort, responsibility and authority.

If the employee can't perform an essential job function because of a physical or mental condition (including the continuation of a serious health condition), he or she isn't entitled to be reinstated to the same or equivalent position under the FMLA. Keep in mind, though, that this situation may be covered by another federal law, namely, the Americans with Disabilities Act (ADA).

For information and technical assistance on the ADA, visit http://www.ada.gov/.

In the case of a highly-compensated "key" employee, you can deny job restoration if it would cause "substantial and grievous economic injury" to your operations. However, in order to do so, you must comply with certain notice requirements, including a notice at the time the key employee requests leave. For more information about key employees under the FMLA, please see the FMLA Regulations (29 CFR Sec.825).

When employees don't return to work

If an employee gives you "unequivocal notice" of his or her intent not to return to work, your obligations under FMLA end. But as long as an employee expresses an interest in returning to work at the end of FMLA leave, you must continue benefits according to the FMLA.

This is true even if the employee also indicates that a return to work might not be possible.

If an employee doesn't return to work after using all available FMLA leave, you can recover health premiums you paid during the leave, except when the employee did not return to work for one of the following reasons:

• the continuance, recurrence or onset of a serious health condition of the employee or a family member that would otherwise entitle the employee to FMLA leave; or
• other circumstances beyond the employee's control.

If an employee doesn't return to work because of a serious health condition — either the employee's or a family member's — you can require medical certification. You can recover 100% of the health premium payments you made during the unpaid leave if:

• the employee fails to provide certification within 30 days of your request for it; or
• the reason the employee doesn't return to work isn't because of circumstances beyond the employee's control.