From the CED mailbag: Can you require employees to use accrued paid time off while receiving SDI or PFL if they are on FMLA leave? We’ll explain the rules below.
We recently received the following question from a subscriber:
Has the law changed regarding whether an employer can require employees to use their paid time off while receiving SDI or PFL if they are on FMLA leave?
Here’s the answer, courtesy of Marjorie Fochtman, Esq. Fochtman is a frequent and popular speaker at ERI events; she’s an attorney with the San Francisco office of Nixon Peabody, LLP:
You are correct that the law has changed regarding whether an employer can require employees to use their paid time off while receiving SDI or PFL if they are on FMLA leave.
Learn how to master all the ins and outs of the California and federal leave rules with our new HR Management & Compliance Report, How To Comply with California and Federal Leave Laws.
The regulations for FMLA (at 29 C.F.R. 825.207) state what we have historically considered the basic rule about requiring employees to use accrued time off during FMLA. Section (a) of that section states that, “FMLA permits an eligible employee to choose to substitute accrued paid leave for FMLA leave. If an employee does not choose to substitute accrued paid leave, the employer may require the employee to substitute accrued paid leave for unpaid FMLA leave.”
However, another section, (d), applies to employees covered under a disability leave plan. In California, all employees would be considered covered under a disability leave plan because they are entitled to California State Disability benefits (“SDI”). Section (d) treats the issue of substitution of paid time off differently:
d) Leave taken pursuant to a disability leave plan would be considered FMLA leave for a serious health condition and counted in the leave entitlement permitted under FMLA if it meets the criteria set forth above in Sec. Sec. 825.112-825.115. In such cases, the employer may designate the leave as FMLA leave and count the leave against the employee’s FMLA leave entitlement. Because leave pursuant to a disability benefit plan is not unpaid, the provision for substitution of the employee’s accrued paid leave is inapplicable, and neither the employee nor the employer may require the substitution of paid leave. However, employers and employees may agree, where state law permits, to have paid leave supplement the disability plan benefits, such as in the case where a plan only provides replacement income for two-thirds of an employee’s salary. [emphasis added]
Learn how to master all the ins and outs of the California and federal leave rules with our new HR Management & Compliance Report, How To Comply with California and Federal Leave Laws.
So an employer can’t require employees to use their paid time off when on FMLA leave because they have SDI income. An employer and employee can agree to have paid time off supplement the SDI, but the employer can’t require it. I would assume the same principle would apply to PFL. California is the only state to have PFL, so the issue hasn’t been tested.
Tomorrow, we’ll share another leave-related question from the mailbag. We’ll also introduce a great new resource that can help you find the answers to tricky questions like this right from the comfort of your office.