On November 17, 2008, the US Department of Labor (DOL or Department) published its final rule to implement the amendments to the federal Family and Medical Leave Act (FMLA), signed into law by President Bush in January 2008, which provide new military family leave entitlements, and to update the regulations under the 15 year old FMLA. The new regulations go into effect on January 16, 2009. According to DOL, “[t]he final rule will improve communication between employees, employers, and health care providers to make the law operate more smoothly, and provide needed clarity for both workers and employers about their responsibilities and rights under the FMLA leave.” 

The final rule was developed in response to the passage of the military family leave provisions in the National Defense Authorization Act (NDAA) for FY 2008, Public Law 110 181; US Supreme Court and lower court cases invalidating portions of the Department’s regulations; the Department’s 15 years of experience enforcing and administering the FMLA; and input from various “stakeholders” and other interested parties who filed public comments during the rulemaking process. 

Some of the highlights of the changes in the final rule are discussed below:

Military Family Leave:  Section 585(a) of the NDAA amended the FMLA to provide two new leave entitlements:

1. Military Caregiver Leave (also known as Covered Servicemember Leave): Under the first of these new military family leave entitlements, eligible employees who are family members of covered servicemembers will be able to take up to 26 workweeks of leave in a “single 12 month period” to care for a covered servicemember with a serious illness or injury incurred in the line of duty on active duty. 

2. Qualifying Exigency Leave:  The second new military leave entitlement was designed to help families of members of the National Guard and Reserves manage their affairs while the member is on active duty in support of a contingency operation. This provision makes the normal 12 workweeks of FMLA job protected leave available to eligible employees with a covered military member serving in the National Guard or Reserves to use for “any qualifying exigency” arising out of the fact that a covered military member is on active duty or called to active duty status in support of a contingency operation. The Department’s final rule defines qualifying exigency by referring to a number of broad categories for which employees can use FMLA leave: (1) Short notice deployment; (2) Military events and related activities; (3) Childcare and school activities; (4) Financial and legal arrangements; (5) Counseling; (6) Rest and recuperation; (7) Post deployment activities; and (8) Additional activities not encompassed in the other categories, but agreed to by the employer and employee.
   

The final rule also includes two new DOL certification forms that may be used by employees and employers to facilitate the certification requirements for the use of military family leave.

The Ragsdale Decision and Penalties

The final rule includes several technical regulatory changes to reflect current law following the US Supreme Court’s decision in Ragsdale v. Wolverine World Wide, Inc., which invalidated a penalty provision of the regulations. Ragsdale held that the current regulation’s “categorical” penalty for failure to appropriately designate FMLA leave, which in that case would have required the employer to provide an additional 12 weeks of FMLA protected leave after the 30 weeks of leave the employee had already received, was inconsistent with the statutory entitlement to only 12 weeks of FMLA leave and contrary to the statute’s remedial requirement that an employee demonstrate individual harm.  Several other courts have also invalidated similar categorical penalties in other notice provisions of the current regulations. The final rule removes these “categorical” penalty provisions and clarifies that only where an employee suffers individualized harm because the employer failed to follow the notification rules might the employer be held liable.

Light Duty  

Under the final rule, time spent performing “light duty” work does not count against an employee’s FMLA leave entitlement and the employee’s right to restoration is held in abeyance during the period of time the employee performs light duty (or until the end of the applicable 12 month FMLA leave year). If an employee is voluntarily performing a light duty assignment, the employee is not on FMLA leave.

Waiver of Rights

The final rule codifies the Department of Labor’s position that employees may voluntarily settle or release their FMLA claims without court or Department approval.  Although this is not a change in the law, the clarification is needed because a recent decision by the US Court of Appeals for the Fourth Circuit interpreted the Department’s regulations as prohibiting employees from either prospectively or retroactively waiving their rights. Prospective waivers of FMLA rights continue to be prohibited under the final rule.

Serious Health Condition

The final rule retains the six individual definitions of “serious health condition” under the FMLA while adding guidance on three regulatory matters. One of the definitions of serious health condition involves more than three consecutive, full calendar days of incapacity plus “two visits to a health care provider.” The US Court of Appeals for the Tenth Circuit had held that the “two visits to a health care provider” must occur within the more than three days period of incapacity.  Under the final rule, DOL clarified that the two visits must occur within 30 days of the beginning of the period of incapacity and the first visit to the health care provider must take place within seven days of the first day of incapacity. 

A second way to satisfy the definition of serious health condition under the current regulations involves more than three consecutive, full calendar days of incapacity plus a regimen of continuing treatment. The final rule clarifies here also that the first visit to the health care provider must take place within seven days of the first day of incapacity. 
Third, the final rule defines “periodic visits” for chronic serious health conditions as at least two visits to a health care provider per year.

Substitution of Paid Leave

It is well-settled that FMLA leave is unpaid. However, the FMLA provides that employees may take, or employers may require employees to take, any accrued paid vacation, personal, family or medical or sick leave, as offered by their employer, concurrently with any FMLA leave. This is called the “substitution of paid leave.” The current regulations apply different procedural requirements to the use of vacation or personal leave than to medical or sick leave. Complicating matters even further, the Department had treated family leave differently than vacation and personal leave.  Accordingly, under the final rule, all forms of paid leave offered by an employer will be treated the same, regardless of the type of leave substituted (including generic “paid time off’). An employee electing to use any type of paid leave concurrently with FMLA leave must follow the same terms and conditions of the employer’s policy that apply to other employees for the use of such leave. The employee is always entitled to unpaid FMLA leave if he or she does not meet the employer’s conditions for taking paid leave and the employer may waive any procedural requirements for the taking of any type of paid leave.

Perfect Attendance Awards

The final rule changes the treatment of perfect attendance awards to allow employers to deny a “perfect attendance” award or bonus to an employee who does not have perfect attendance because of taking FMLA leave provided it treats employees taking non FMLA leave in an identical way. 

Employer Notice Obligations

The final rule consolidates all the employer notice requirements into a “one stop” section of the regulations and reconciles some conflicting provisions and time periods under the current regulations. Furthermore, according to the DOL, “the final rule clarifies and strengthens the employer notice requirements in order to better inform employees and allow for a better exchange of information between employers and employees.” 

Employers will be required to provide employees with a general notice about the FMLA (through a poster, and either an employee handbook or upon hire); an eligibility notice; a rights and responsibilities notice; and a designation notice. In order to ensure employers are able to better inform employees under the new notice provisions, the final rule extends the time for employers to provide various notices from two business days to five business days.

Employee Notice

The final rule modifies the current provision that has been interpreted to allow some employees to provide notice to an employer of the need for FMLA leave up to two full business days after an absence, even if they could have provided notice more quickly.  Lack of advance notice (e.g., before the employee’s shift starts) for unscheduled absences is one of the biggest disruptions employers point to as an unintended consequence of the current regulations. The final rule provides that an employee needing FMLA leave must follow the employer’s usual and customary call in procedures for reporting an absence, absent unusual circumstances. The final rule also highlights (without changing) the existing consequences if an employee does not provide proper notice of his or her need for FMLA leave.

Medical Certification Process (Content and Clarification)

The final rule recognizes the enactment of the Health Insurance Portability and Accountability Act (HIPAA) and the applicability of the HIPAA privacy rule to communications between employers and employees’ health care providers. Further, in response to specific concerns raised by employees about medical privacy, the Department of Labor has added a requirement to the final rule that specifies that the employer’s representative contacting the health care provider must be a health care provider, human resource professional, a leave administrator, or a management official, but in no case may it be the employee’s direct supervisor. 

Further, employers may not ask health care providers for additional information beyond that required by the certification form. The final rule also improves the exchange of medical information by updating the Department’s optional Form WH 380 to create separate forms for the employee and covered family members and by allowing, but not requiring, health care providers to provide a diagnosis of the patient’s health condition as part of the certification.

In addition, the final rule specifies that if an employer deems a medical certification to be incomplete or insufficient, the employer must specify in writing what information is lacking, and give the employee seven calendar days to cure the deficiency. 

Medical Certification Process (Timing)

The final rule codifies a 2005 DOL Wage and Hour Opinion letter that stated that employers may request a new medical certification each leave year for medical conditions that last longer than one year. The final rule also clarifies the applicable time period for recertification. Under the current regulations, employers may generally request a recertification no more often than every 30 days and only in conjunction with an FMLA absence unless a minimum duration of incapacity has been specified in the certification, in which case recertification generally may not be required until the duration specified has passed. Because the current regulation is unclear as to the employer’s ability to require recertification when the duration of a condition is described as “lifetime” or “unknown,” the final rule restructures and clarifies the regulatory requirements for recertification. In all cases, the final rule allows an employer to request recertification of an ongoing condition every six months in conjunction with an absence.

Fitness For Duty Certifications 

The current FMLA regulations allow employers to enforce uniformly applied policies or practices that require all similarly situated employees who take leave to provide a certification that they are able to resume work. This is called a “fitness for duty” certification. The final rule makes two changes to the fitness for duty certification process. First, an employer may require that the certification specifically address the employee’s ability to perform the essential functions of the employee’s job.  Second, where reasonable job safety concerns exist, an employer may require a fitness for duty certification before an employee may return to work when the employee takes intermittent leave.

Conclusion

Although the courts generally give deference to DOL interpretations of the FMLA, there likely will be challenges to the final rule, and there is no guarantee that the Department’s position on all of these issues will be accepted by all courts. The Arent Fox employment law group regularly advises clients on FMLA matters and defends them against FMLA claims.  Please feel free to contact us if you wish to discuss these issues further.

Michael L. Stevens
stevens.michael@arentfox.com
202.857.6382