Maintenance of Employee Benefits

The taking of FMLA leave cannot result in the loss of any employment benefit accrued before the leave began.

Additionally, during any FMLA leave, an employer must maintain the employee's coverage under any group health plan under the same terms and conditions as coverage would have been provided if the employee had not taken leave. An employee's entitlement to benefits other than group health benefits during a period of FMLA leave, such as holiday pay, is determined by the employer's established policy for providing such benefits when the employee is on other forms of leave, paid or unpaid, as appropriate.

If an employer provides a new health plan or benefits or changes health plan or benefits while an employee is on FMLA leave, the employee is entitled to the new or changed plan or benefits to the same extent as if the employee were not on leave.

An employee may choose not to retain group health plan coverage during FMLA leave. However, when an employee returns from leave, he or she is entitled to be reinstated on the same terms as before the leave without any qualifying period, physical examination, exclusion of pre-existing conditions, etc.

Except as required by the Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) and for "key employees" as discussed below, an employer's obligation to maintain health benefits during leave and to restore the employee to the same or equivalent employment under the FMLA ceases if and when:

• The employment relationship would have terminated if the employee had not taken FMLA leave;
• The employee informs the employer of his or her intent not to return to work;
• The employee fails to return from leave; or
• The employee continues on leave after exhausting his or her FMLA leave entitlement in the 12-month period.

If a "key employee" does not return from leave when notified by the employer that substantial or grievous economic injury will result from his or her reinstatement, the employee's entitlement to group health benefits continues unless and until the employee advises the employer that he or she does not desire restoration to employment at the end of the leave period, FMLA leave entitlement is exhausted, or reinstatement is actually denied.

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For more information on this aspect of the FMLA, see the FMLA regulations: § 825.209