FMLA and all its requirements seems to be on employers’ minds in today’s workplace. It can be hard enough to keep track of what the FMLA requires of you with respect to employees that are on your payroll. What about those people performing work for you that are not on your payroll? Do FMLA requirements there too? Can more than one entity have FMLA responsibilities toward a worker or group of workers? Let’s return to Tricia the Temp from Sensational Staffing. Tricia, has filled in as an administrative assistant for one of your managers, on and off (through Sensational) from February 2013 through the present. You learn through Sensational that Tricia has been in a car accident. Tricia needs surgery and at least six weeks of rehabilitation therapy. You sympathize, but you don’t want to hold Tricia’s job open that long, so Sensational, sends you Reliable Rhonda for now. What happens when Tricia is ready to come back to work? Do you have to accept her back? Rhonda, is working out well, and, after all, Tricia is just a “temp”. Isn’t that the beauty of using “temps”? If they wanted the same protections as “regular” employees then they shouldn’t work as temps, right? Guess what? You may in fact have to take Tricia back. Let’s take a look at how it all works after the jump!
Let’s just quickly review the FMLA. An employee who has worked for an employer for at least 1250 hours in the 12 months preceding a request for leave, who has a serious medical condition or is caring for a family member with a serious medical condition may be entitled to up to 12 weeks’ unpaid, job and benefit-protected leave. The employee is entitled to be reinstated to the same job or if it is not available, then one substantially equal in pay, benefits and responsibilities. An employer with at least 50 employees within 75 miles must follow these FMLA requirements. .
Tricia qualifies for FMLA leave. She worked more than 1300 hours for Sensational (and for your company) in the last 12 months and has a serious medical condition. But who is Tricia’s employer? Most authorities would agree that Sensational is her employer, but you may also be. The Department of Labor regulation 29 CFR 825.106 , (which you can find here) actually addresses this issue. If both your company and Sensational have at least 50 employees within 75 miles and if you control Tricia’s work, you are joint employers for FMLA purposes. You check your records and confirm that you only have 45 employees on your payroll. Does that mean you are not covered under the FMLA? Not necessarily. Suppose currently you also have 10 workers supplied by Sensational. Under Department of Labor regulations you have to count those employees for determining FMLA coverage. In other words, under the FMLA you have 55 employees and the FMLA will apply to you. Since Tricia has been working as an administrative assistant to one of your managers, your company in all likelihood controls Tricia’s work and is a joint employer.
Now what? Sensational will be considered the primary employer, and will therefore be responsible for providing any required notices to Tricia, and for following up with Tricia’s doctor to find out how long Tricia will need to be out. You are the secondary employer. Sensational be expected to reinstate Tricia to the same or substantially similar job when she is ready to go back to work if such a job is available. At the same time though, if you are still using a staffing agency to fill the job that Tricia had prior to her car accident, you will have to accept her back, or Tricia can sue you, claiming that you interfered with her FMLA rights, retaliated against her for exercising those rights, or maybe even both. This is essentially what happened in Grace v. USCAR and Bartech Technical Services, LLC, —F.3d–, 2008 WL 782470 (6th Cir. 2008)
What happens if Sensational, has an overhead staff of 30 employees and 85 “temps” but, your company only has 25 direct employees and 7 “temps”? Sensational is clearly covered under the FMLA. On the one hand, under these facts, you are not a covered employee under the FMLA. On the other hand, under 29 C.F.R. § 825.106(e), the secondary employer is responsible for “accepting the employee returning from FMLA leave in place of the replacement employee if the secondary employer continues to utilize an employee from the temporary or leasing agency. The Sixth Circuit in Grace held this requirement to apply even when an employer is not otherwise covered under the FMLA, so even if you are not a joint employer, some courts may still hold that you must accept Tricia back.
Suppose the project for which you hired Tricia finishes in two weeks and there are no other similar temporary positions available at your company. Do you have to accept Tricia back then? In that case, no. You can either ask Sensational to end Tricia’s assignment two weeks early, or engage Reliable Rhonda for the remaining two weeks and then end the assignment as you had previously planned. What about Sensational? If the assignment at your company ends before Tricia is due to return to work, what are Sensational’s responsibilities? Tricia, as soon as she is able to return to work is entitled to other assignments. Sensational must make reasonable efforts to find such assignments for Tricia. It is not liable if no such assignments are available, but Sensational cannot simply write Tricia off once her FMLA leave starts.
What about PEO’s? The DOL’s position is that a PEO is not a joint employer if it simply performs administrative functions, such as those related to payroll benefits and updating employment policies. It may be a joint employer if it has the right to hire, fire, assign or direct and control the client employer’s employees. That of course will depend on facts and circumstances. For those interested you can find the DOL regulation is 29 CFR Sec. 825.106(d).
One more quick point: Companies that are sufficiently intertwined are considered an “integrated employer” for FMLA purposes (and under other federal statutes) and may be considered one employer. Factors considered include: a) common offices, bank accounts, bookkeeping, equipment; b) shared management, directors and boards; c) centralized control of labor relations and personnel (e.g. hiring and firing) d) shared ownership and financial control. Parent and subsidiary companies is one example of such a relationship. Therefore, even if each entity separately might not be liable under the FMLA together they might be.
OK, that’s a wrap! Next week guest blogger, Rebecca Gray, will give us some tips on how to avoid gender discrimination claims when recruiting and hiring. Don’t miss it!
Disclaimer: This post’s contents are for informational purposes only, are not legal advice and do not create an attorney-client relationship. Always consult with competent local employment counsel on any issues discussed here.
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