Know the Law: When Key Employees Use Family Medical Leave Act

November 5, 2018

Published in the Union Leader (11/5/2018)

Q: Our highest paid executive employee has asked to take leave under the Family and Medical Leave Act (“FMLA”). Losing her for 12 weeks will be a burden on the company, and we may need to replace her right away. Do we have to allow the leave, and does she have to be reinstated?

A. Despite the fact that this is a highly paid and apparently important employee, you will have to grant the leave if she is eligible and if the proper certification paperwork is completed.

You also may need to reinstate her. Under narrow circumstances, a key employee may be denied reinstatement at the end of FMLA leave. FMLA regulations define a “key employee” as “a salaried FMLA-eligible employee who is among the highest paid 10 percent of all the employees employed by the employer within 75 miles of the employee’s worksite.”

An employer may invoke the key employee exception “if the employer should determine that substantial and grievous economic injury to the employer’s operations will result if the employee is reinstated from FMLA leave.”

It is a high standard to meet. The focus should be the impact of restoration on the employer’s operations, rather than on the effect of the employee’s absence.

Once it is determined that the employee meets the above criteria, the employer should consider whether it can cover the employee’s absence with current employees or find a temporary replacement.

If it is considering invoking the key employee exception, the employer must provide written notice in person or by certified mail at the time of leave that the employee may be denied reinstatement. The notice must contain the potential consequences of denying reinstatement and health benefits.

Then, the employer must notify the employee in writing of its determination and the reasons for it. The determination letter must inform the employee that it cannot deny FMLA leave, but the employer intends to deny reinstatement.

Despite meeting notice requirements, the leave must be granted if the employee qualifies for it. A “key employee’s rights under FMLA continue unless and until the employee either gives notice that he or she no longer wishes to return to work, or the employer actually denies reinstatement at the conclusion of the leave period.”

The employer must fill the position by the time the employee is ready to return to work. Otherwise, the exception does not apply. However, the employee may still request reinstatement. If this happens, the employer is obligated to determine whether reinstatement triggers substantial and grievous economic injury based on the current facts.

This article does not address all aspects of the FMLA and presumes that the company meets the criteria for an FMLA employer. You should seek guidance from an attorney whenever utilizing the key employee exception and if you have questions about whether the FMLA applies to your workplace.

Jacqueline Botchman can be reached at

Know the Law is a bi-weekly column sponsored by McLane Middleton, Professional Association. We invite your questions of business law. Questions and ideas for future columns should be addressed to: McLane Middleton, 900 Elm St., Manchester, NH 03101 or emailed to Know the Law provides general legal information, not legal advice. We recommend that you consult a lawyer for guidance specific to your particular situation.