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Does FMLA Apply to Your Small Business?

Having a stable and prosperous work-life balance is essential for everyone's overall wellbeing. In order to promote this ideology, the development of the Family and Medical Leave Act (FMLA) was designed to help employees adequately achieve balance in their work and personal life to address medical responsibilities without worry. It allows them to take a considerable amount of time off (12 weeks of unpaid, job-protected leave per the calendar year) from their employment duties to tend to family or medical-related situations, such as:

  • Giving birth to a child and taking adequate time off to care for the newborn.

  • Adopted or providing foster care for one or more children.

  • Assisting in the caregiving commitments of an immediate family member (spouse, child, or a parent) that has a serious health condition.

  • If the employee him or herself is not able to perform or fulfill their job requirements due to a developed medical condition.

  • There is another reason that is related to veterans, but we will cover that in a different article.

Though it may sound straightforward on the surface level, when you dive into the core details of what FMLA is, it can get confusing, especially if you are looking into this for the first time. There are many rules that qualified businesses and corporations have to obey to be compliant. If you are a small business or a startup, understanding FMLA is something you need to take action on to ensure you are following federal policy and regulations properly. The last thing you will want is to get into deep water due to not being aware that FMLA applies to you.

If you rather watch a quick video to get the main ideas then here you go.

Are You Subjected to FMLA Regulations?

There a hefty list of federal requirements that will help guide you in determining if your small business is subjected or waived from FMLA regulations. The main essential for this federal law being a mandatory benefit is your employee headcount. If your small business or startup has less than 50 employees, then you are not required to provide FMLA leave to your employees.

Other significant components to be aware of that can make your small business eligible are:

  • If your business fluctuates in staffing, with having at least 50 employees for a duration of 20 weeks in the previous or current year, you will qualify for FMLA, even if you only have a small handful of employees working for you currently.

  • You will need to offer FMLA benefits if you are established as an integrated or joint employer, even if your home base has less than 50 employees. You may fall under this category if you have two or more businesses with common management, interrelated operations, and you share employee services or interchange them.

  • FMLA is a requirement and applies to all public agencies, including state, local, federal, and school admirations, regardless of the other eligibility standards.

Remember, even though this is mandatory for these areas of work, every company, including your small business, can only allow FMLA to eligible employees:

  • Who has worked with the company for at least 12 months.

  • Who have worked a minimum of 1250 hours before the leave request process has started.

  • Who work at a place that has at least 50 employees within 75 miles of the covered employer’s worksite.

Get The FMLA Steps to Compliance Checklist in the free HR Toolkit for Small Business.

Read Up on Your State’s Rules

Let’s say by this point, you have determined that you do not have to offer FMLA for your small business employees. Before checking this off your to-do list, there is still another critical area to check to cover all your basis, and that is looking into your state laws.

Each state can establish their own laws, which can include mandatory leave time. For example, starting in 2021, Massachusetts will allow all employees job-protected absence for specific medical and family reasons, utterly separate from the federal laws. In addition, even though FMLA is generally unpaid, some states may enact regulations for employers to provide pay or wage replacement benefits under a state or local law. In order to assess if you are compliment with both federal and state laws, check out each state’s family and medical leave laws to know what your state demands so you can implement accordingly.

FMLA’s Impact on Your Small Business

It is no secret that adding, or even deducted anything from your business rhythm will affect it in some way or another. As for FMLA, this has a tremendous impact on businesses in many different ways, both positive and negative. To give you some more insight into what your business could face, here are some of the main ways FMLA may impact your small business.

  • If you have very few employees (say you qualified for FMLA due to staff fluctuation), and someone goes out for 12 weeks, it could increase the workload on you and your staff. This can be stressful for everyone, so be prepared and have a plan in place on how to equitably distribute the extra work, so no one gets burnt out.

  • If you offer paid leave, even for part of the FMLA duration, it will undeniably affect your cash flow. As mentioned before, this benefit is generally unpaid, but if your state requires any of it to be reimbursed, then this is something you need to plan for to avoid challenging money periods. Realize this is a potential risk and budget accordingly to help relieve the impact.

  • As a business owner, you are already extremely busy and juggling many balls at once. If FMLA does, in fact, apply to you, be ready for an increased amount of paperwork and regulations to follow. You will have to organize informative and essential paperwork, from employee pre and post forms, notification requirements, and preparing for audits. Even with adding more work to your plate, you will adjust over time, and it will not feel as overwhelming as you get more involved and accustomed.

  • Not everything about FMLA is a bad thing. When you offer this benefit it provides a better atmosphere and peace of mind for your employees that they have the option to take medical leave if the situation ever arose. This could lead to a more loyal and motivated staff, which will develop better business efficiency.

Owning a small business can be stressful, especially when you are trying to make sure you are compliant with laws and regulations. A large part of that is FMLA. This is an area that every small business and startup owner needs to understand and get acquainted with. If you do qualify, you need to ensure that you know what steps to take to follow the federal laws and be aware of the impact it could have on your business. The lack of knowledge can lead to expensive lawsuits that you will most certainly want to avoid. This is why it is vital to take the proper measures to really dive into FMLA details to find out if you are subjected to it or not, so you can stay on top of your business functionality and remain compliant.

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