What does it mean when an employee ‘Goes on Disability’? There is a lot of confusion surrounding this terminology, which can lead to missteps on the part of the employer.
STD (Short Term Disability) is insurance coverage that companies purchase for their employees or make available to their employees to purchase for themselves. This insurance pays the individual usually around 66% of their income if they are disabled and unable to work. An employee might be considered disabled if they need to undergo hip replacement surgery. They will be unable to work for a period of time while they recuperate. An employee might also be considered disabled if they are in an accident, break their leg, and need recovery time at home.
STD is an income replacement benefit. It does not guarantee that the employee will have a job to return to once their medical situation improves.
FMLA (Family & Medical Leave Act) is legislation that protects an employee’s job if they are unable to work due to a personal medical condition, the medical condition of a family member that they care for, and several other categories. FMLA only applies to employers who have more then 50 workers in a 75 mile radius. The protection provides an unpaid leave of absence for up to 12 weeks. An employee can remain on the company health plan, and can even continue to accrue vacation time during their time off. They are entitled to return to their same (or similar) position when the 12 weeks are up.
FMLA is job protection only. It is unpaid leave and does not provide any income to the employee.
Adding to the confusion, many employees will go on FMLA and will receive STD benefits at the same time. Some employers have STD benefits, but do not have any legal obligations under FMLA. It is very important to handle these situations consistently according to policy and in compliance with the law.
If questions like these come up in your business, Advantage Employment would be happy to assist. An HR Professional on our team can act as a point of contact for your employee on leave, and can provide information and guidance to you throughout the process.