Under what circumstances does an employer have to give a pay increase to an employee who is out on approved Family and Medical Leave Act (FMLA) leave during his or her performance review?

Author: XpertHR Editorial Team

If, during the course of the employee's FMLA leave, there was a pay increase, then whether the employee is entitled to it upon return from leave depends on the nature of the increase. For example, an employee is entitled to any unconditional pay increases that occurred during the FMLA leave, such as cost of living increases.

When it comes to conditional pay increases (such as those based on seniority, length of service or work performed), however, an employee is only entitled to the increase if the employer's policy allows employees on equivalent leave status for a reason that does not qualify as FMLA leave to receive such benefits. If so, then the conditional pay raise must be paid to an employee on FMLA leave as well.

Another example is a policy that allows employees to get seniority pay increases every year, with a proviso that any employee who takes unpaid leave exceeding 30 days during the year will incur a 25 percent reduction to the pay increase. This policy is permitted so long as employees on equivalent leave status for reasons that do not qualify as FMLA leave also would have their seniority pay increase reduced.