Taking leave should never cost someone coverage.
Leave and reduced-hours requests sit where benefit eligibility meets retaliation law. Check these points before you change hours, status or coverage.
What the rules require.
The following plain-language notes cover leave and hours. They are informational, not a legal opinion, and the statutes can change, so consult the current provisions.
FMLA Interference And Retaliation
The FMLA bars interference with leave rights and retaliation for using them, and requires group health coverage to continue during leave on the same terms (29 U.S.C. 2615 and 2614(c)).
Section 510 And Hours
Reducing hours so particular employees lose benefit eligibility can violate ERISA Section 510 (29 U.S.C. 1140), even when no leave was taken.
Michigan Earned Sick Time
The Michigan Earned Sick Time Act, MCL 408.961 et seq., protects employees who use earned sick time and forbids retaliation for doing so.
How it plays out at work.
Two questions drive most disputes: did a protected leave or request come before the change, and was the change applied consistently. Document the business reason before the conversation, not after it.
Changing a full-time employee to part time can end plan eligibility under your plan terms and may also affect Affordable Care Act measurement. Apply the plan’s written eligibility rules to everyone, and have counsel review changes for employees who recently used leave.
Remember that leave can be unpaid but coverage may still need to continue. Set up a premium payment method before the leave starts and tell the employee in writing what they owe.
Where this shows up in your plan.
Coverage During Leave
Keep the employee enrolled throughout FMLA leave and collect their share of the premium in an agreed way. Our FMLA guide has more.
Hours Thresholds
Know the plan’s hours requirement and your ACA measurement method before you sign off on a reduced schedule.
Return To Work
Coverage should come back at the end of FMLA leave with no fresh waiting period, as far as the regulations require. Check the details with the carrier.
Setting it up.
Put eligibility rules, including hours thresholds, in the plan document itself.
Hand out leave and premium instructions before leave begins.
Compare recent hours or status changes against leave and complaint history.
Tell the carrier about leave status so records stay right.
Ask supervisors to stay quiet on leave or schedule requests.
Mistakes to avoid.
Shifting someone to part time right after a leave request.
Ending coverage for unpaid premiums without the notices the plan and regulations call for.
Handling similar employees differently without a recorded reason.
Forgetting that sick-time and FMLA rights may overlap.
Other rules employers work with.
Whistleblower Protections Summary
The series hub, with the Michigan statute and federal laws side by side.
FMLA Eligibility and Notice for Michigan
Who qualifies, what notice is due and how coverage works.
Earned Sick Time in Michigan
Michigan’s paid sick leave statute.
Laws and Rules Referenced
29 U.S.C. 2615 (FMLA prohibited acts) — Interference and retaliation under the FMLA.
29 U.S.C. 2614 (FMLA health coverage) — Keeping group health coverage in place during leave.
29 U.S.C. 1140 (ERISA Section 510) — The ERISA ban on interfering with plan rights.
FMLA (U.S. Department of Labor) — DOL guidance on the FMLA.
Quick answers.
Here are compact answers to what comes up most with employers, each linking to the in-depth page.
Must group health coverage continue during FMLA leave?
Yes. The terms stay as they would be if the employee were working, and the employee typically pays their share.
Can I reduce someone’s hours after they take leave?
Only for legitimate, documented reasons applied evenly. Speak with counsel first.
Does reducing hours affect plan eligibility?
It may, depending on plan terms, but a cut designed to avoid benefits can breach ERISA Section 510.
Does reading this create an attorney relationship?
No. It explains the basics only, and a particular case calls for an employment attorney.
More guides in this series.
Michigan Whistleblowers’ Protection Act: Employer Guide
A companion guide in the same series.
ERISA Section 510 and Benefit Plan Retaliation: Employer Guide
A companion guide in the same series.
Federal Anti-Retaliation Laws Employers Should Know
A companion guide in the same series.
Employee Benefit Claims and Retaliation Protections for Employers
A companion guide in the same series.
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