Short answer: Often yes. The employer may recover its share of health premiums paid during unpaid FMLA leave if the employee does not return, unless the reason is a continuing serious health condition or another circumstance beyond the employee’s control.
Under the FMLA rules, the employer may recover its share of premiums for a period of unpaid FMLA leave when the employee fails to return after the leave ends. It may not recover if the employee does not return because of:
- the continuation, recurrence or onset of a serious health condition of the employee or a family member, or a covered servicemember’s serious injury or illness; or
- other circumstances beyond the employee’s control, such as a spouse’s unexpected transfer more than 75 miles away or a layoff during leave.
The employer may require medical certification of the health reason, due within 30 days of its request. An employee who returns for at least 30 calendar days, or who retires straight from leave or within those 30 days, counts as having returned.
No recovery is allowed for periods covered by paid leave, including workers’ compensation. A self-funded employer may recover only its share of the premium as calculated for COBRA, excluding the 2% administrative fee. The amount is a debt and may be deducted from final pay only where wage-payment law allows.