- Blog post
FMLA regulations protect employer’s changes to a benefit plan
Accrued sick time is a protected FMLA benefit.
Is it legal under FMLA regulations to change your benefits package and deny employees benefits accrued under the old plan? According to a recent Court of Appeals decision, yes.
After a merger a few years ago, Wells Fargo Bank changed its benefits policy. Although the new plan was generous, it didn’t recognize the sick days accumulated by employees prior to the merger.
Angry over losing their stock of paid sick days, several employees filed a class-action suit claiming the company’s action violated FMLA regulations.
FMLA requires employers to provide at least 12 weeks of unpaid leave to employees for the treatment of a serious disabling health condition suffered by the employee;
the birth of a child;
the care of a child, spouse, or parent who suffers from a serous health condition.
The court ruled that Wells Fargo’s change in benefits did not run afoul of the FMLA. The judge ruled that FMLA “does not create an entitlement to accrued sick time. In short, the FMLA does not require Wells Fargo to ‘lock-in’ a particular benefits package.”
Bottom line: the court rejected the plaintiffs’ attempt to link sick time policies to the FMLA. Wells Fargo’s new plan met the minimum requirements under FMLA regulations.
Cite: Funkhouser v. Wells Fargo Bank, NA, U.S. Court of Appeals, 9th Circuit, Nos. 00-35397 and 00-35410, 5/15/02