Group health benefit premiums can be recovered under limited circumstances, according to the Family and Medical Leave Act (FMLA) regulations ( 29 CFR 825.213 ). Generally, a worker must return to work for 30 calendar days to avoid having to reimburse the employer for its contributions during unpaid leave.

Employers cannot recover premium costs when:

• An employee is on paid leave.
• The employee does not return due to the condition’s recurrence or the onset of another serious health condition.
• An individual begins retirement within 30 days of taking FMLA leave.
• There are circumstances beyond the employee’s control such as the elimination of an employee’s position during FMLA leave.
• An employee cannot return because he or she is needed to take care of a family member with a serious health condition.

The regulations note that “other circumstances beyond the employee’s control would not include a situation where an employee desires to remain with a parent in a distant city even though the parent no longer requires the employee’s care, or a parent chooses not to return to work to stay home with a well, newborn child.”

An employer may request certification that the employee’s presence is needed for the purpose of taking care of the family member. The employee will have up to 30 days to provide the employer with certification from the date the certification is requested. Should the employee fail to provide the certification, an employer can require the employee to pay 100 percent of the health premium costs that were paid by the employer.

Employers can recover the premium costs through deductions from wages, vacation, profit sharing, etc. However, the employer must comply with federal and state laws regarding deductions.

In most states this means getting authorization from the employee to take the deduction. It is best to get this authorization at the time FMLA is initiated, as it is difficult to obtain this authorization at the end of the leave. When the employer cannot make deductions, it may have to resort to initiating legal action against the employee if it is to recoup the costs. 
Please Note: This material is provided as general information and is not a substitute for legal or other professional advice. Contact the Knowledge Center for more information.
 

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