If you're considering taking leave from work under the Family and Medical Leave Act of 1993 (FMLA) for maternity leave, to take care of a loved one, or to recover from a surgery or accident, there's a good chance you may have to save up or dip into your savings.
Under the FMLA, your company is legally required to permit you to take up to 12 weeks of unpaid leave within a 12-month period if you're eligible. The key word here is “unpaid.” While the law mandates that your company keeps your job – or equivalent job – open for you upon your return, it's in no way forced to pay your salary while you're on leave.
Furthermore, in many instances, your company may require you to use paid vacation time or accrued sick time before allowing you to take unpaid leave. In these instances, your paid leave will count towards your FMLA-protected leave. For instance, if you have accrued two weeks of paid vacation time, and you need to be absent for a total of five consecutive weeks for an FMLA-qualifying reason, then, you will be paid for the first two weeks during your FMLA leave (based on your accrued vacation), and the last three weeks of your FMLA leave will be unpaid. In some instances a company may make a concession, but this is not required.
Remember – FMLA is protection for your job, meaning that you are guaranteed reinstatement – not compensation. Be sure to discuss your company's policies regarding paid time and FMLA with your supervisors before taking leave if possible.
In addition, the FMLA instructs your employer to keep you and your family (if applicable) on its group insurance coverage. However, you may be required to pay out of pocket for your coverage while you're on leave.
It's important to remember that there are a number of requirements you must meet to be eligible for FMLA. Your company must employ at least 50 workers in a 75-mile radius, and you must have worked for the company for a minimum of one year, putting in at least 1,250 hours. If you're not eligible, your company is not required to provide you any time off under the FMLA.
While you will not receive a salary under FMLA, you may get a portion of it if your company offers short-term disability insurance (STD). Under STD, a percentage of your salary (on average, 50 percent to 70 percent) would kick in for a specified amount of time pursuant to the policy. STD and FMLA are often used simultaneously – STD provides you the money you need; FMLA guarantees your job will be waiting for you when you return.
Compared to the rest of the world, American workers get the short end of the stick when it comes to paid family leave. Therefore, it's important to understand the complexities of FMLA and financially prepare for your leave so that you can concentrate on your family during your time away from your job.