Deducts from bonuses for use of sick leave- a violation of FMLA?

cstorms · September 2001

A company has instituted a policy where any employees who use sick leave, even for bonafide purposes as stated in the Employee Handbook, lose 1/2 of their quarterly bonus. The quarterly bonus's are based on company profitability and have been historically given to all employees employed for the quarter. The new policy was set to discourage use of sick leave that saps profitability. However, parents with sick children, people recovering from surgery or with Dr's excuses still lose half of their bonuses. Is this a violation of FMLA?

Margaret Morford · September 2001

I believe that this is a violation of FMLA because it punishes an employee for exercising his/her FMLA rights by not paying him/her a bonus that other employees (who don't exercise those FMLA rights) get. If your policy doesn't count time off under FMLA to earn the bonus, you probably would be okay...unless the time off is a reasonable accomodation under ADA, in which case, you would have a different legal problem. I think you should get a legal opinion on this bonus plan change.

Margaret Morford
theHRedge

joyce · September 2001

I agree. It is against FMLA regulations per section 825.215 (2) ......the employee may not be disqualified for the bonus(es) for the taking of FMLA leave. You may want to read the whole section, however before making your decision.

Down_the_Middle · September 2001

I would question whether this is a FMLA violation since the use of sick leave involves the loss of a production type of bonus. You don't mention whether "employed for the quarter" is simply time in service or based on hours worked, but I really question whether an FMLA absence is a problem for this type of bonus. FMLA does not require the accrual of other benefits while on FMLA and I see this as one of those "other " categories. I'll be anxious to know the outcome with your local counsel.

Gillian · September 2001

I think that counsel will say that it is a violation of FMLA. Violations aside, what kind of message does this send to employees? To get whacked when one is legitimatly ill won't add to a positive relationship between the employee and the employer.

cstorms · September 2001

I have appreciated all of the feedback. I reviewed the paragraph 215 of the regulations and it appears that this bonus plan could not discriminate against those that use FMLA leave. More info. on the bonus plan- it is given to all employees based on the number of regular (non-ot) hours worked in the quarter. Employees using vacation leave or other unpaid leave do not suffer the 1/2 of bonus loss that anyone using sick leave would lose. This seemed key too.

The other question I have on it is this- since employer has a paid sick leave program, and does not acknowledge whether a use of sick leave is FMLA leave or not, what triggers whether it is FMLA- the purpose of the sick time taken??? I read the regs more on this, but haven't got the finer points down. Thanks. Also, this is in Oregon State- don't know how it was noted as Florida on my original submission.

Margaret Morford · September 2001

I recommend that your FMLA policy force employees to run out their sick time, personal time, vacation time, etc. whenever they use FMLA. You wouldn't want anyone to take 12 weeks of FMLA and then return and want three weeks of vacation.

If your policy forces employees to use sick leave, vacation time, etc. then it works like this:

Employee has 2 weeks vacation and 1 week of sick leave. He/she is granted 12 weeks of FMLA. The employee gets 12 weeks of leave, 3 weeks of which are paid and 9 weeks of which are unpaid. They return from FMLA leave with no accrued time in their vacation or sick leave banks. Don't confuse the issue of whether an employee gets paid for the leave (sick pay, personal time, PTO, etc.) with the issue of whether you have to give them the leave time. Hope that helps. Call me if you have questions about my answer.

Margaret Morford
theHRedge
615-371-8200

Gar · September 2001

It seems to me that if the sick leave runs concurrently or simultaneously with FMLA time off, denying the bonus is a violation, pure and simple.

Lanie · September 2001

I would agree this is a violation of FMLA. In any case it's my experience that it's best to err on the side of caution and tread lightly with FMLA issues. Paying out money for a bonus is, in the long run, a lot cheaper than paying legal fees for a law suit.

Rockie · March 2002

This is fine as long as you don't count FMLA or any other federally protected areas (ADA, etc.). We are thinking about going this route with our attendance policy, where if employees exceed so many unscheduled absences (call offs) then a full percentage point will be taken off their merit increases for the year. It was either this or wait until so many points and then discharge the employee. We felr that if we hit people in their pocketbook, they make take notice before they incur excessive absences without good cause. My biggest reservation about this is consistency of the supervisors in adminstering the policy. We also thought about giving employees a last ditch effort to straighten up their act before we put this in place (maybe between now and the first of the year and then implement the new policy). Sorry to digress from the FMLA here.

Deducts from bonuses for use of sick leave- a violation of FMLA?

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