Article by Brian Mead and Dawn M. Peacock of McDermott Will & Emery
The Family and Medical Leave Act (FMLA) was enacted in 1993, a year when the idea of working a corporate job from a living room was rare. When the law was passed, the FMLA didn't contemplate a remote workforce. Now, and especially post-pandemic, many companies are embracing a fully remote workforce (e.g., sales representatives, healthcare medical device technicians and software engineers). While employees' needs for a leave of absence have always been around, remote employment and its effects on the applicability of the FMLA requirements has not. For well over two years, many employees have been working from home. Some report to a manager at the headquarters or worksite. Plenty of remote employees, however, report to an individual who also works remotely. The new remote landscape is making what used to be an easy application of FMLA eligibility into a difficult analysis. This article examines the FMLA regulatory framework for remote employees, a recent Texas federal court decision on the issue and the practical options that employers have moving forward.
THE FMLA REMOTE EMPLOYEE FRAMEWORK
The FMLA requires that certain private employers provide eligible employees with up to 12 weeks of unpaid leave from work to take care of their serious health condition or a family member's serious health condition. A private employer with more than 50 employees within a 75-mile radius of the employee's worksite must provide the requisite 12-week leave. An eligible employee is one who meets all of the following conditions:
- Is employed for at least 12 months
- Has been employed for at least 1,250 hours during the 12-month period immediately preceding the start of the leave
- Is employed at a worksite where 50 or more employees are employed by the employer within 75 miles of that worksite.
One of the most challenging aspects of determining eligibility for leave under the FMLA is whether the employee is employed at a "covered employer" (i.e., a worksite with 50 or more employees within a 75-mile radius).
The FMLA is silent on its applicability to remote workers. However, the US Department of Labor's implementing regulations state that "[f]or employees with no fixed worksite, … the worksite is the site to which they are assigned as their home base, from which their work is assigned, or to which they report." Further, "[a]n employee's personal residence is not a worksite in the case of employees … who travel a sales territory and who generally leave to work and return from work to their personal residence, or employees who work at home, as under the concept of flexiplace or telecommuting ."
A CASE STUDY ON FMLA'S APPLICABILITY TO REMOTE EMPLOYEES
Recently, a Texas court analyzed the remote employee question and the applicability of the FMLA. In Landgrave v. Fortec Medical Inc., a remote employee sued her former employer, Fortec, alleging that it failed to provide her leave under the FMLA after concluding that she was not eligible because the company did not have 50 employees within a 75-mile radius in Texas. Landgrave was employed as a surgical laser technician and was hired as a remote employee. Landgrave argued her "worksite" under the FMLA was the company's headquarters in Ohio, which did have more than 50 employees. Fortec argued that her "worksite" was in Texas.
Although Landgrave was hired through Fortec's Ohio headquarters, she lived and primarily worked in Texas (sometimes her work required her to travel to other states, but not Ohio). Landgrave's supervisor also was a remote employee working from Texas. The supervisor managed the south-central region of Texas, oversaw logistics for the region, paired surgical technicians with assignments, monitored Landgrave's performance and handled Landgrave's requests for time off.
The court denied Fortec's motion for summary judgment because it found that there was a genuine issue of fact as to Landgrave's worksite and therefore her FMLA eligibility. To have won summary judgment, Fortec would have had to establish that the Ohio headquarters worksite was not her home base, the site that assigned her work or the site to which she reported. A brief overview of each issue is below.
- Home Base. The court found that there were insufficient facts to establish that the Ohio location was Landgrave's home base. Using the Worker Adjustment and Retraining Notification Act as a guide, the court stated that an employee's home base "must at a minimum be a location at which the employee is physically present at some point during a typical business trip" and "refers not to the physical base of the employer's operations … but rather to the physical base of the employee." Since Landgrave was never physically present in Ohio, she could not establish Ohio as her home base.
- Assignment of Work. The court found that there was a genuine issue of fact regarding where the assignments were created/originated, and the dispute on this element precluded summary judgment. The assigning site is the "source of the day-to-day instructions" given to the employee. It is not determined by the location of payroll or other centralized managerial or personnel functions. It is not merely from where the instructions are passed, but rather "where the people were who were ultimately responsible for creating and receiving the assignment information." In Landgrave, the employee's supervisor assigned work from his home in Texas, and he directed cases to specific employees within the Texas region. However, Landgrave characterized her supervisor's assignment of work as "click[ing] the mouse on his computer at his house and send[ing] the instructions from [Ohio] to one technician or the other in his region." The court found that while Landgrave's supervisor appeared to have more of a role than a "mere conduit," his duties did appear ancillary to the actual assignment activity, which created a triable issue of fact for the jury as to whether that assignment came from headquarters in Ohio.
- Reporting Worksite. The court also found there was a genuine issue of fact as to Landgrave's supervisor's reporting structure and authority, such that the issue also precluded summary judgment. The location to which an employee reports is determined based on the "location of the personnel who were primarily responsible for reviewing … reports and other information sent by the [employee], in order to record [tasks], assess employee performance, develop new sales strategies, and the like." It was undisputed that Landgrave's supervisor did not review reports from her. In fact, Landgrave sent reports only to Ohio and never sent anything to her supervisor. Fortec focused on the fact that her Texas supervisor assessed her employment and was empowered to discipline and evaluate her. However, the company's claim lacked factual support at the summary judgment stage, as there was no evidence that her supervisor did any evaluations or had the power to impact her employment status. For those reasons, Fortec's argument on this element was not strong enough to support summary judgment.
Since the court's ruling, the parties reached a confidential settlement concerning Landgrave's FMLA claims.
PRACTICAL OPTIONS FOR EMPLOYERS WITH A REMOTE WORKFORCE
Given the FMLA legal framework described above and the insight from the Landgrave decision, employers have three options to manage FMLA leave with a remote workforce.
1. Conservative Approach. Employers can take the most conservative approach by determining that the FMLA applies to remote employees (assuming the length of employment and hours worked conditions are met). Approaching eligibility from this perspective will help employers avoid potential violations of the FMLA and related legal claims. However, in some factual situations, this option may provide more generous leave than the employees are entitled to receive, and FMLA leave is often difficult for employers to manage.
2. Affirmative Approach. Employers can undertake the FMLA analysis themselves by affirmatively assigning either a reporting site or an assignment site, and then ensuring that such worksite meets the requirement of 50 or more employees within 75 miles. This approach appears to be supported by the FMLA regulations, which state, "[f]or employees with no fixed worksite … the worksite is the site to which they are assigned as their home base, from which their work is assigned,orto which they report." Employers should note that the day-to-day facts may undermine an employer's express designation, however. For example, if an employer by policy and written agreement determines that all remote employees report to X location, but no employees ever actually report to X location, those facts may undermine the employer's designation of the reporting site. The same concept applies to an assignment site. If an employee never receives assignments, or receives only a small number of assignments, from Y worksite, a court may have trouble concluding that Y is indeed the accurate worksite on which to base the 75-mile radius test. Either way, as seen in Landgrave, courts have the discretion to use any of the three worksite bases outlined above for the 75-mile test.
3. The Landgrave Approach. Employers can take a more liberal approach and analyze the FMLA application to the remote workforce on a case-by-case basis. This would involve examining each employee's home base, assigning site and reporting site, then determining whether any of those locations have 50 or more employees within a 75-mile radius. If they do not, the employee would not be eligible for FMLA leave. But as shown in Landgrave, this approach has a higher risk of litigation due to potential factual disputes about the sites at issue.
In the wake of COVID-19, more businesses are permitting their employees to work remotely. When it comes to family and medical leave (paid or unpaid), employers should make sure they understand the eligibility rules for their remote employees under federal and (sometimes conflicting) state law. In the case of the FMLA, it is important for employers to understand the workflow of the business and to track the various worksites for all employees, including the remote ones.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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