Sometimes, employees need to take an extended break from work due to medical or family situations. The Family and Medical Leave Act (FMLA) offers job-protected leave for these reasons. Knowing how to use FMLA benefits and related benefits like short-term disability can reduce financial and emotional stress during tough times.
Here’s a quick primer on FMLA so that you can be sure your finances work for you even when you’re not working.
Understanding the Family and Medical Leave Act (FMLA)
The FMLA, enacted in 1993, allows eligible employees to take up to 12 weeks of unpaid leave per year for specific family and medical reasons, while maintaining their job protection. This federal law applies to all public agencies, public and private elementary and secondary schools, and companies with 50 or more employees.1
Eligibility requirements
To qualify for FMLA leave, you must meet the following criteria1:
- Work for a covered employer
- Have worked for the employer for at least 12 months (not necessarily consecutive)
- Have completed at least 1,250 hours of work in the 12 months prior to the leave
- Work at a location where the employer has at least 50 employees within 75 miles
Qualifying reasons for FMLA leave
FMLA leave can be taken for the following reasons1:
- The birth of a child or to bond with a newborn within one year of birth
- The placement of a child for adoption or foster care and to bond with the newly placed child within one year of placement
- To care for a spouse, child, or parent with a serious health condition
- A serious health condition that makes you unable to perform your job
- Any qualifying exigency arising because a spouse, child, or parent is a military member on covered active duty
How to apply for FMLA leave
To apply for FMLA leave, follow these steps1:
- Notify your employer at least 30 days in advance if the need for leave is foreseeable
- Submit a completed FMLA request form, available from your employer or the Department of Labor’s website
- Provide medical certification if required by your employer
How short-term disability works
Short-term disability insurance provides partial wage replacement if you're unable to work due to a non-work-related illness or injury. While FMLA provides job protection, short-term disability offers financial support during your leave.
Eligibility and coverage
Short-term disability varies by employer and state, so check your specific policy for details. Generally, it covers a percentage of your salary, typically between 50% and 70%, for a period ranging from a few weeks to several months. 2
How to apply for short-term disability
To apply for short-term disability benefits2:
- Notify your employer of your condition as soon as possible
- Submit a claim form, typically available from your employer or insurance provider
- Provide medical documentation supporting your inability to work
Understanding your employee benefits
Employee benefits play a crucial role in supporting your financial and physical well-being during periods of leave. Familiarize yourself with your employer's benefit offerings, which may include health insurance, retirement plans, and flexible spending accounts.
Health insurance
Ensure you understand your health insurance coverage, especially regarding medical leave. Under FMLA, employers are required to maintain your health benefits during your leave as if you were still working1.
Employee assistance programs (EAPs)
EAPs offer confidential counseling and referral services to help you manage personal and work-related challenges. These programs can provide valuable support during medical leave.
The importance of an emergency savings account
An emergency savings account is essential for financial stability, particularly when facing medical or family emergencies. Having three to six months' worth of living expenses saved can provide a safety net during times of reduced income.
Building an emergency fund
To build an emergency savings account:
- Set a savings goal based on your monthly expenses
- Create a budget to identify areas where you can cut costs
- Set up automatic transfers to your savings account
- Consider using windfalls, such as tax refunds or bonuses, to boost your savings
Using your emergency fund wisely
Use your emergency fund only for genuine emergencies, such as medical expenses, job loss, or urgent home repairs. Replenish the fund as soon as possible after using it.
Look into supplemental health insurance
You might have great health insurance through your employer. However, many people aren’t prepared for the out-of-pocket medical costs and living expenses that come with an accident, the diagnosis of critical illness or hospital visit. Supplemental health insurance can may help.
Conclusion
Navigating the Family and Medical Leave Act, short-term disability, and employee benefits can be complex, but understanding these resources can help you make informed decisions during challenging times. By leveraging these benefits and maintaining an emergency savings account, you can manage your financial and emotional well-being effectively. For more information, consult your employer's human resources department or visit the U.S. Department of Labor's website.
