26 Nov Looking forward to your year-end bonus? Caution: FMLA leave may affect that
Does your employer offer incentive-based year-end bonuses? For example, some employers give employees a bonus based on their attendance record. The better their record, the better their bonus.
Normally, under the Family and Medical Leave Act (FMLA), employees who go on leave are entitled to the same pay and benefits, as well as the same job or an equivalent one, when they return to work. You would still have access to any raises or bonuses that are considered automatic, even though you took FMLA leave. However, when a bonus is performance-based, the rules are a bit different.
What kind of time off might affect your bonus?
If you take paid vacation time, that won’t decrease your year-end bonus. However, a leave of absence under the Family and Medical Leave Act (FMLA) can affect your year-end bonus.
FMLA regulations 29 C.F.R. § 825.215(c)(2) provide that:
. . . if a bonus or other payment is based on the achievement of a specified goal such as hours worked, products sold or perfect attendance, and the employee has not met the goal due to FMLA leave, then the payment may be denied, unless otherwise paid to employees on an equivalent leave status for a reason that does not qualify as FMLA leave. For example, if an employee who used paid vacation leave for a non-FMLA purpose would receive the bonus, then the employee who used paid vacation leave for an FMLA-protected purpose also must receive the bonus. (emphasis added).
Why? Companies offering a performance-based bonus incentive can’t discriminate against employees who take an equivalent leave period for a reason that does not qualify as FMLA leave. So, if they are able to deny someone that extra bonus amount because they were absent for jury duty, for example, they may deny someone who took leave on FMLA.
In short: employees on FMLA leave must be treated the same by their employer as employees on other types of leave.
Looking for more resources on the FMLA?
Download our Quick Guide to the Family and Medical Leave Act (FMLA) or our Extended Quick Guide to FMLA.
You can see more employment resources here.