DOL issues Final FMLA Regulations on New Servicemember and Exigency Leaves and Revises Serious Health Condition Rules.

Yesterday, the DOL issued the long-awaited final revisions to the FMLA regulations governing leaves of absences for serious medical conditions and issued new regulations governing the new military servicemember and exingency leaves of absences. The final rules become effective on January 16, 2009 and will require employers to update their FMLA policies and practices to reflect the new rules.

Among the many changes made in the new FMLA rules are the following:

1. § 825.106: Joint employment. Professional employer organizations (PEOs) which merely administer employee benefits will NOT be considered a joint employer for purposes of determining FMLA eligible UNLESS the PEO has the right to hire, fire, assign, or direct and control the employees, or benefits from the work they perform depending “on the economic realities of the situation and . . . all the facts and circumstances.’’ In short, whether “an employment relationship exists must be determined in light of the economic realities of the situation.” Moreover, when a PEO is determined to be a joint employer of a client employer’s employees, the client employer would only be required to count employees of the PEO (or employees of other clients of the PEO) if the client employer jointly employed those employees. In any event, the client employer would be considered the “primary employer” for purposes of giving the FMLA notices, etc.

2. § 825.110: Employee Eligibility.
a. Seven Year Gap. To be eligible for FMLA leave, the current regulations require that, among other things, the employee must have been employed for at least twelve months by the employer, although that period need not be consecutive. While February’s proposed rule provided that employers would not need to consider periods of prior employment which preceded a five-year gap of employment, the final rule extends that period to seven years. However, there are three exceptions to the seven-year gap rule: (i) when the gap results “from an employee’s fulfillment of National Guard or Reserve military service obligations as provided by USERRA, (ii) when a “written agreement exists concerning the employer’s intention to rehire the employee after the break in service” (such as a collective bargaining agreement); and (iii) when an employer voluntarily considers prior service pursuant to a consistently applied policy or practice.

b. 1250 hours in prior twelve months. The final rule also clarifies that time spent in military service also counts towards the employee’s 1250 hours in the prior twelve months for purposes of qualifying for FMLA leave. Similarly, the 1250 hour and twelve-month requirements may be satisfied by time spent while an employee is on any other approved leave of absence (including non-FMLA leave). “An employee may be on non-FMLA leave at the time he or she meets the eligibility requirements, and in that event, any portion of the leave taken for an FMLA-leave qualifying reason after the employee meets the eligibility requirement would be FMLA leave.”

I will summarize additional significant changes in the new FMLA regulations throughout the week on this blog. Additional changes are summarized in my November 19 posting at http://hapnerlaw.blogspot.com/2008/11/new-fmla-regulations-become-effective.html. Until I've completed my summary and consolidated them in one posting, eager beavers and insomniacs can read the 201 pages of single-spaced new rules and explanatory comment in full at http://edocket.access.gpo.gov/2008/pdf/E8-26577.pdf.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.