Managing Employees on Leave of Absence

Posted on 4 August 2021 by IRIS FMP

Employees across America are not often legally entitled to casual leave of any kind. Instead, the only legal requirement for most employers is mandated at state level rather than at a federal one.

The United States is the only high-income country that has no minimum leave requirements. Whilst president Joseph Biden is looking to change that, the proposals still fall short of many other countries.

However, as it currently stands, leave of absence varies depending on employee size, the type of leave requested and more. When it comes to assigning leave, understanding the legal requirements for each kind of leave mandated and how to manage benefits while an employee is on leave can be tricky.

Federal Eligibility for Leave in America

Employees of private-sector businesses over 50 employees are legally entitled to unpaid, job-protected leave for certain circumstances under the Family and Medical Leave Act (FMLA). There are no other minimum leave requirements for non-federally employed staff aside from the recent COVID Families First Coronavirus Act, which ended mandatory leave on January 1st, 2021.

These are called ‘covered employers’ and these employees are entitled to specific benefits as set out by the FMLA.

Employer Eligibility Under FMLA

To be considered a covered employer, you either must be:

  1. A private sector employer with 50 or more employees who have worked more than 20 workweeks
  2. A public agency, including local, state or federal, regardless of the number of employees.
  3. A school, up to secondary and either public or private, regardless of the number of employees.

Employee Eligibility for FMLA leave

As well as working for a covered employer, there are more stipulations for determining eligible employees:

  1. Has worked for the employer for at least 12 months.
  2. Has worked at least 1,250 hours of service under an employer in the 12-month period preceding the leave.
  3. Works at a location where the employer has at least 50 employees within 75 miles.

What Does FMLA Leave Cover?

Under FMLA, employees may take up to 12 weeks of unpaid but job-protected leave in a 12-month period for one or more of the following circumstances:

  • The birth of a child, or placement of a child for adoption or foster care
  • To care for a spouse, child or parent who has serious health conditions
  • For a serious health condition that prevents the employee from carrying out their job
  • For qualifying exigency when a spouse, child or parent is a military member on active duty or called up for.

For those with covered servicemembers in their family who is seriously injured or ill, whether child, spouse, parent or next of kin, a 26 week military caregiver lead is allowed.

Casual Leave, And Other Non-Mandated Leave Types

All other leave types, unless they are mandated by your states labor board, are not required to be paid and are, therefore, unregulated. It’s up to the employer to dictate leave and pay requirements for the following leave types, and any other that arise:

  • Funeral and bereavement leave, unless covered by FMLA
  • Vacations, federal holidays and important state days, unless you are covered by government contract rule
  • Jury Duty
  • Sick leave not covered under the FMLA
  • Educational

While this varies from state to state, all other leave types are considered unpaid at a federal level. All these kinds of leave are considered additional benefits that can make an employer more competitive in talent markets.

Approaching Casual Leave as a Small Business

When working as a business that isn’t mandated under FMLA to provide paid leave, it can be hard to balance leave in a way that doesn’t negatively impact you or your employees.

While some businesses may choose to go down the Paid Time Off route, others may offer a certain number of days for each kind of leave and then provide leave on a case-by-case basis.

Payroll Complications with Paid Leave

If paid leave is a percentage of an employee’s full time pay, then it must be calculated accurately as to avoid payroll issues:

  • If paid leave is incorrectly calculated, then any mistakes must be remedied by the correct party.
  • It’s important to notice and sort any mistakes before tax is claimed or any relief funds are given to a company, as this would cause more administration issues.
  • If special payroll codes are required, and the wrong one applied, retrospective change is needed to ensure that any changes are marked correctly.

Creating a Leave Policy

Many businesses will choose to create a leave policy which dictates their allowances for each kind of leave and whether you will need to create a letter for approval and more.

Some things to consider in your leave policy could include:

  • Leave approval times
  • Leave accrual (could an employee, for example, earn more leave for each year of service?)
  • Regarding rolled over holiday, is this allowed, or does it expire after a set date?

Your policy should be robust and ensure that employees are cared for but cannot abuse the system. Leave can be offered as a competitive benefit, so it’s important you compare and grow this leave policy against your other competitors, but also against any other international branches you may have.

Leaves of Absence FAQs

Do You Get Paid for Medical Leave of Absence?

If you are covered by the FMLA, then your leave will be job protected but is legally not required to be paid. It is therefore at your employer’s discretion, if it is not state mandated, to pay you.

Is Paid Family Leave Federal or State?

If the employer is a covered employer, and the employee is eligible, under FMLA it will be considered federal. However, FMLA does not stipulate that you have to be paid.

This may change at state level, or at your employer’s discretion you may be paid.

How Many Days Leave do you Get in the USA?

Technically none. If you are not covered by the FMLA or a federal worker, you have no legal requirements, but you can receive these from each employer.

Are you wondering how to pay employees on various leave types? Speak to our international payroll experts today for assistance.