[Code of Federal Regulations]

[Title 29, Volume 3]

[Revised as of July 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 29CFR825.218]



[Page 775]

 

                             TITLE 29--LABOR

 

         CHAPTER V--WAGE AND HOUR DIVISION, DEPARTMENT OF LABOR

 

PART 825_THE FAMILY AND MEDICAL LEAVE ACT OF 1993--Table of Contents

 

 Subpart B_What Leave Is an Employee Entitled To Take Under the Family 

                         and Medical Leave Act?

 

Sec.  825.218  What does ``substantial and grievous economic injury'' 

mean?



    (a) In order to deny restoration to a key employee, an employer must 

determine that the restoration of the employee to employment will cause 

``substantial and grievous economic injury'' to the operations of the 

employer, not whether the absence of the employee will cause such 

substantial and grievous injury.

    (b) An employer may take into account its ability to replace on a 

temporary basis (or temporarily do without) the employee on FMLA leave. 

If permanent replacement is unavoidable, the cost of then reinstating 

the employee can be considered in evaluating whether substantial and 

grievous economic injury will occur from restoration; in other words, 

the effect on the operations of the company of reinstating the employee 

in an equivalent position.

    (c) A precise test cannot be set for the level of hardship or injury 

to the employer which must be sustained. If the reinstatement of a ``key 

employee'' threatens the economic viability of the firm, that would 

constitute ``substantial and grievous economic injury.'' A lesser injury 

which causes substantial, long-term economic injury would also be 

sufficient. Minor inconveniences and costs that the employer would 

experience in the normal course of doing business would certainly not 

constitute ``substantial and grievous economic injury.''

    (d) FMLA's ``substantial and grievous economic injury'' standard is 

different from and more stringent than the ``undue hardship'' test under 

the ADA (see, also Sec.  825.702).