FMLA Paid Leave Substitution Rules

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On January 14, 2025, the U.S. Department of Labor issued an Opinion Letter regarding the applicability of the Family and Medical Leave Act (FMLA) substitution rule when an employee on FMLA leave is receiving state or local paid family and medical leave benefits.

An increasing number of state governments have passed legislation that provides paid family and medical leave for reasons such as personal medical, family care and parental leave. Some local governments have also adopted paid sick and/or family leave programs for their municipal government employees. These plans generally provide paid leave programs for specified family and medical reasons and vary widely in their structure (including whether they are mandatory or voluntary), the scope and duration of benefits provided, and their similarity to the leave reasons covered by the FMLA.

For example, many of the leave programs permit leave for circumstances which may be qualifying FMLA leave reasons as well, while some define qualifying family members more broadly than the FMLA (e.g., including grandparents or parents-in-law), some provide leave for a different set of health conditions, and some provide a leave period longer or shorter than that provided by the FMLA.

The FMLA substitution rule allows employees or employers to substitute accrued employer-provided paid leave (such as vacation, sick leave, or personal time off) for any part of the unpaid FMLA entitlement period.

This webinar will help you navigate the “substitution rule” and whether and how it applies when employees take leave under state paid family leave programs in the same manner as they apply when employees take leave pursuant to paid disability plans.

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