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FMLA leave and reinstatement: How to handle ‘key employees’

When employees take leave under the federal Family and Medical Leave Act (FMLA), employers generally know the drill about what to do when the leave ends: The employee must be reinstated in the same position he or she left or one that is equivalent. 

But just because the law is rigid in many respects doesn’t mean there isn’t leeway in some situations. For example, reinstatement may not be required for employees deemed to be “key employees.” Recently a group of attorneys well-versed in FMLA issues was asked about exceptions to the reinstatement rule for certain high-level employees. Here is their take on that limited exception to the FMLA rule.

Andy Rodman, an attorney with Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A., in Miami, Florida, points out that generally employees are entitled to be returned to the same or an equivalent position, but limited exceptions exist, including the “key employee” exception.

“A key employee is a salaried FMLA-eligible worker who is among the highest-paid 10 percent of all employees employed by your company within a 75-mile radius,” Rodman says. “Under very limited circumstances, a key employee may be denied reinstatement at the end of FMLA leave.”

Rodman lists the requirements necessary for denying reinstatement:

  • The employer must determine that reinstatement will cause “substantial and grievous economic injury” to the organization’s operations. To determine such injury, the employer must focus on how reinstating the employee will injure the organization’s operations. “This is a high standard. Minor inconveniences and costs do not rise to the level of ‘substantial and grievous economic injury,’” Rodman says.
  • The employer must give the employee written notice of his or her status as a key employee and explain how that status potentially can prevent reinstatement.
  • The employer must advise the employee in writing as soon as the employer determines reinstatement will cause substantial and grievous economic injury. “The notice must explain the basis of your finding of substantial and grievous economic injury and give the employee reasonable time to return to work,” Rodman says. “A key employee’s rights continue until she provides notice that she does not want to return to work or you deny reinstatement at the conclusion of the leave.”

Even if a key employee doesn’t return to work in response to the employer’s notice that reinstatement may be denied, the employee may still request reinstatement, Rodman says. Then, it’s up to the employer to determine whether reinstatement does indeed trigger substantial and grievous economic injury. If so, the employer must advise the employee in writing of the finding.

“In short, a key employee may not be entitled to reinstatement at the end of FMLA leave, but the standard for proving substantial and grievous economic injury is very high,” Rodman says. “Employers must jump through many hoops before denying reinstatement. Always consult your attorney when making decisions about an employee’s FMLA reinstatement rights.”

When deciding how to handle reinstatement, employers need to first determine whether the employee’s situation is cover ed under the law – even before determining whether the employee fits the definition of “key employee.”

Meghan E. Siket, an attorney with Whelan, Kinder & Siket LLP in Providence, Rhode Island, was asked how to handle a key employee’s request for leave to care for her brother. The employer was planning to deny the leave request based on key employee status.

Siket reminds employers that although an employer sometimes can deny reinstatement to key employees, employers must grant leave even to key employees who are eligible. The employee wanting to care for her brother, however, isn’t eligible for leave.

“The FMLA does not allow employees to take leave to care for a sibling,” Siket says. “Under the FMLA, employees may take leave to care for a parent, spouse, or child with a serious health condition.”