Whether an employee continues to earn paid time off (PTO) benefits while taking leave under the Family and Medical Leave Act (FMLA) involves a complex interaction of federal statute, state regulations, and company policy. PTO includes benefits such as sick leave, vacation time, and personal days, which an employee typically accrues over time. The answer to continued accrual during a protected absence depends entirely on the specific type of leave being taken and the policies governing the workplace.
FMLA Eligibility and Duration
The Family and Medical Leave Act provides eligible employees with up to 12 workweeks of job-protected leave during a 12-month period. This federal law applies to covered employers, generally private-sector businesses with 50 or more employees within a 75-mile radius. To qualify, an employee must have worked for the employer for at least 12 months and completed at least 1,250 hours of service during the 12 months immediately preceding the leave. Covered reasons include the birth of a child, the placement of a child for adoption or foster care, or a serious health condition affecting the employee or an immediate family member.
The Federal Rule on PTO Accrual
Under the federal FMLA statute, an employer is not required to allow employees to accrue new PTO benefits while the employee is on an unpaid FMLA leave. Federal law dictates that an employee on FMLA leave must be treated the same as any other employee who is on a comparable form of unpaid leave. If a company’s standard policy stops the accrual of vacation time or sick leave for an employee on a personal unpaid leave, then the same restriction can be applied to an employee on unpaid FMLA leave. The employer must ensure, however, that this policy is applied consistently across all forms of comparable leave to prevent discrimination.
State Laws and Company Policies That Mandate Accrual
The federal rule represents only the minimum standard, and many states and municipalities have regulations that provide greater protection for employees. Some state-specific paid sick leave laws require that employees continue to accrue sick time based on hours worked, regardless of the reason for a leave of absence. Furthermore, if a state or local jurisdiction offers its own paid family or medical leave program, such as those found in California or New York, the rules governing accrual of employer-provided PTO can differ significantly. These state programs often create a more complex legal framework.
A company’s own written policy can also supersede the federal minimum and mandate continued PTO accrual during FMLA leave. If an employer’s policy states that benefits like vacation time or personal days will continue to accrue during FMLA, the employer is bound to follow that more generous commitment. Consistency is a central requirement: if an employer permits accrual during other types of unpaid leave, such as military leave, they must also permit accrual during FMLA leave to avoid discriminatory application of benefits.
Using Existing PTO Concurrently with FMLA
The question of earning new PTO must be distinctly separated from the use of time already accumulated. The FMLA permits an eligible employee to substitute their accrued paid leave, such as vacation or sick time, for any part of their otherwise unpaid FMLA leave entitlement. The employer may also require the employee to use their existing PTO concurrently with the FMLA leave. This substitution means the paid leave runs at the same time as the job-protected FMLA leave, ensuring the employee receives compensation during their absence.
If the employee uses existing PTO, making their FMLA leave partially or fully paid, the employer’s standard policy for employees on paid status usually applies to the continued accrual of new PTO. If the company policy allows employees to accrue new vacation time while they are on paid sick leave, the employee on paid FMLA leave must also be allowed to accrue new benefits. This substitution mechanism is a means of income replacement during the leave and does not impact the employee’s underlying FMLA job protection.
Continuation of Non-Accrual Benefits During Leave
While the accrual of new PTO is not federally mandated during unpaid FMLA leave, the law does require the continuation of other specific employee benefits. The most significant of these is the maintenance of group health insurance coverage for the employee under the same terms and conditions as if the employee had continued to work. If the employee was responsible for a portion of the premium before the leave, they must continue to pay that portion during the FMLA leave to keep the coverage active.
Beyond health insurance, the FMLA also ensures the preservation of seniority earned prior to the leave. Upon the employee’s return from FMLA, the employer must restore the employee to the same job or to an equivalent position with identical pay, benefits, and other terms of employment. These requirements focus on preserving the employee’s status and existing benefits.