The Family Medical Leave Act was enacted for employers who have 50 or more employees in 20 or more workweeks in the current or previous calendar year. The FMLA says that eligible employees of covered employers are entitled to take unpaid leave for specific family and medical reasons with continuation of group health insurance under the same terms and conditions as if the employee had never taken leave. Eligible employees are entitled to:
Twelve workweeks of leave in a 12-month period for:
the birth of a child
adoption of a child
caring for the employee’s spouse, child, parent who has a serious health condition
a serious health condition that makes the employee unable to perform his or her job
any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on “covered active duty;”
Employees are eligible for FMLA leave if:
They work for an employer who is “covered” by FMLA (the criteria listed above)
They have worked for the employer for at least 12 months as of the date that FMLA is to start,
Has at least 1,250 hours of service for the employer during the 12-month period immediately before the date the FMLA leave is to start
They work at a location where the employer employs at least 50 employees within 75 miles of that worksite as of the date when the employee gives notice of the need for leave
How does that apply to group health plans?
Under FMLA guidelines, employers are required to maintain the employee’s coverage during any FMLA leave. In other words, the employee’s coverage is expected to remain continuous throughout the 12-week period. If the employer provides a new health plan or benefits, or the health plan changes while an employee is on leave, the employee is entitled to the new or changed plan/benefits to the same extend as if the employee were not on leave and a notice must be provided to the employee on leave.
What are the employee’s responsibilities during this time?
During the FMLA period, the employee must continue to pay their premium shares. The employer must also provide the employee with advance written notice under which these payments must be made. If the premiums are increased, the employee would be required to pay the updated premium.
If the employee is substituting accrued paid leave for the unpaid FMLA leave, the employee’s share of premiums must be paid by the method normally used during any paid leave, presumably as a payroll deduction.
If FMLA leave is unpaid, the employer may require employees to pay their share of premium payments in
any of the following ways:
Payment would be due at the same time as it would be made if by payroll deduction,
Payment would be due on the same schedule as payments are made under COBRA,
Payment would be prepaid pursuant to a cafeteria plan at the employee’s option,
Existing rules for payment by employees on “leave without pay” may be followed, provided that such rules do not require prepayment of the premiums that will become due during a period of unpaid FMLA leave or payment of higher premiums than if the employee had not taken leave; or
Another system voluntarily agreed to by the employer and the employee.
The employer may require that payment be made to the employer or to the insurance carrier, but no additional charge may be added to the employee’s premium payment for administrative expenses.