Court Upholds Termination of Health Benefits for Virginia Firefighter on Paid Sick Leave

Today’s burning question: I am a firefighter and I was seriously hurt while off duty. While recuperating, the city stopped my health care even though I had not exhausted all of my paid sick leave. Can they do that?

Answer: According to the US District Court for the Western District of Virginia, the city was within its rights to stop a firefighter’s health benefits once the statutory 12 weeks of FMLA leave ended, even though he still had plenty of accrued sick leave.

Captain Barry Neal was injured in a fall while off-duty on February 1, 2013, suffering broken ribs, a collapsed lung, and head injuries. He was off on sick leave until July 17, 2013. At the time he had approximately 2000 hours of accrued sick leave with the Danville Fire Department, which he utilized for the duration of his disability.

On February 15, 2013, the city officially placed him on Family Medical Leave Act (FMLA) leave, which started the clock running on the FMLA mandated 12-weeks of protection. At the conclusion of the 12-week period, the City informed Captain Neal that his health insurance benefits would cease effective May 14, 2013, due to the exhaustion of his FMLA leave protection. He was also informed of his rights under Consolidated Omnibus Budget Reconciliation Act (“COBRA”) to extend his health coverage at his own expense.

Captain Neal filed suit against the city in US District Court claiming that the policy of canceling health insurance benefits for employees who had not exhausted their sick leave violates COBRA. The court explained COBRA as follows:

Congress passed … COBRA… to require most group health plans to provide continuation of group health coverage in instances where an employee’s coverage might otherwise cease. COBRA requires that a plan sponsor provide an employee the opportunity to elect continuation of health insurance coverage under the same terms of the employer’s health plan after some “qualifying event” that would otherwise end the employee’s health insurance coverage.

As is relevant here, a “qualifying event” is defined as:

[A]ny of the following events which, but for the continuation coverage required under this part, would result in the loss of coverage of a qualified beneficiary . . . (2) [t]he termination (other than by reason of such employee’s gross misconduct), or reduction of hours, of the covered employee’s employment.

According to Captain Neal, no qualifying event occurred because he was still on paid leave the entire duration of his time off. However, the city argued that his inability to work constituted a “reduction of hours”, and therefore was a qualifying event. While the FMLA prohibits a reduction in benefits during the mandatory 12 week period, the city claims it was within its rights to cancel his health care once the FMLA period ended.

In an eight page ruling issued on December 11, 2014, Senior US District Court Judge Jackson L. Kiser agreed with the city that the use of sick leave is a reduction in hours.

  • When Plaintiff did not return to work following the exhaustion of his FMLA leave, the City’s legal obligation under FMLA and COBRA to provide group health insurance benefits ended.
  • Plaintiff’s inability to return to work and the use of his paid sick leave reduced the hours he actually worked to zero.
  • The City’s policy mandated that an employee’s group health insurance benefits be terminated if the employee fails to return to work following the exhaustion of FMLA leave.
  • These two facts constitute a “qualifying event” under COBRA because, but for the continuation coverage, Plaintiff’s reduction in hours would have resulted in the loss of his health insurance benefits.
  • The City complied with COBRA by informing Plaintiff of his right to elect continuation coverage, and the City is entitled to summary judgment on Plaintiff’s claim.

Here is a copy of the ruling: Neal v Danville

It is important to note that the FMLA mandated 12 weeks is intended to be the ABSOLUTE MINIMUM amount of protected leave that an employer must provide by law, not a maximum beyond which an employer would be considered extravagant. The city’s position and the court’s ruling leaves me scratching my head. A worker is supposed to work X hours. Instead of working X hours, his sick leave bank is charged X hours. Yet somehow his hours have been reduced?

I have to believe there are alot of folks in Congress who voted for the FMLA who would not be happy if they knew that reputable employers were taking advantage of a law intended to protect employees when they need it the most, and use it to decrease their benefits. Again – we are talking about an employee who has accrued sick leave, not someone who has exhausted their benefits.

Makes you wonder if the folks responsible for the City of Danville’s policy toward their employees will see themselves in any of the characters in A Christmas Carroll should they have the opportunity to watch it over the holidays!!!!

About Curt Varone

Curt Varone has over 45 years of fire service experience and 35 as a practicing attorney licensed in both Rhode Island and Maine. His background includes 29 years as a career firefighter in Providence (retiring as a Deputy Assistant Chief), as well as volunteer and paid on call experience. He is the author of two books: Legal Considerations for Fire and Emergency Services, (2006, 2nd ed. 2011, 3rd ed. 2014, 4th ed. 2022) and Fire Officer's Legal Handbook (2007), and is a contributing editor for Firehouse Magazine writing the Fire Law column.
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