Does FMLA Apply to Small Businesses? A Plain-English Guide for Owners
Does FMLA apply to small businesses? Here’s a plain-English guide to thresholds, exemptions, and smart leave policies owners can use.
Published under The Legal Hat on HatStacked.com
Running a small business is complicated enough without adding federal acronyms to the mix. You’ve already got IRS, OSHA, HIPAA, and now someone mentions FMLA. Cue the panic Googling at midnight.
Let’s put this one in plain English: does the Family and Medical Leave Act (FMLA) even apply to your business? And if not, what should you do anyway to stay sane, legal, and not become the villain of your own HR sitcom?
FMLA in 30 Seconds (Because That’s All You Can Spare)
The Family and Medical Leave Act is a federal law that lets certain employees take up to 12 weeks of unpaid, job-protected leave for things like:
- Having a baby
- Caring for a sick family member
- Serious personal health issues
- Military family needs
Sounds straightforward until you realize there are exceptions, carveouts, and threshold rules that only a lawyer could love.
Here’s the kicker: FMLA only applies to employers with 50 or more employees (within a 75-mile radius).
Translation: if you’ve got a team of 12 and a golden retriever mascot, FMLA technically doesn’t apply to you.
The Threshold Rule (a.k.a. The Magical Number 50)
The line in the sand is simple:
- 49 employees or fewer = FMLA does not apply.
- 50+ employees = Congrats, you’ve unlocked a new level of paperwork.
It’s not about revenue, location, or how many LLCs you have. It’s strictly employee headcount.
Important fine print: That 50 count includes full-timers and part-timers if they work at least 20 weeks in the current or prior year. No ducking the math by calling everyone “independent contractors.” The Department of Labor sees through that.
Related: How to Legally Protect Your Business When Hiring Industry Talent
So, If I’m Under 50, Can I Just Ignore Leave Requests?
Legally? Yes. Practically? Not so fast.
Even if you’re not covered by FMLA, your employees still live in the real world. Babies will be born. Parents will get sick. Life happens. And if you act like a robot, you’ll tank morale faster than you can say “staffing shortage.”
Many small business owners choose to offer unofficial leave policies to stay competitive. Think of it as HR goodwill points.
- A week or two of unpaid leave for new parents
- Flexible scheduling for family needs
- Cross-training your staff so coverage doesn’t implode
This isn’t about being “nice.” It’s about keeping good people and avoiding the PR disaster of being the boss who told someone to come back to work two days after surgery.
State Laws: The Surprise Twist
Here’s where it gets tricky: just because federal FMLA doesn’t apply doesn’t mean your state lets you off the hook.
- California: Offers its own Paid Family Leave program, regardless of business size.
- New York: Paid Family Leave kicks in for nearly all private employers.
- Washington: Paid Family and Medical Leave applies even to small employers (though cost sharing varies).
- Massachusetts: Has a Paid Family and Medical Leave program that doesn’t care if you only have five employees.
Moral of the story: check your state’s Department of Labor site before assuming you’re in the clear. Some states love acronyms more than Washington does.
What Smart Small Businesses Do Anyway
Even if you’re under 50 employees, here are smart moves:
- Write a simple leave policy: One page, clear, no legalese. Spell out what’s available, paid or unpaid.
- Cross-train staff: Absences are less stressful when multiple people can cover.
- Document everything: A polite email trail can save you later if a dispute pops up.
- Stay consistent: If you let one person take two weeks off, you can’t deny it to the next.
Why It Pays to Have Something Written Down
Here’s what happens if you don’t:
- Employee A asks for two weeks off for surgery. You say yes.
- Employee B asks for two weeks off for childcare. You say no.
- Employee B goes to Facebook and suddenly you’re the boss who hates parents.
Having a short, clear leave policy avoids messy “he said, she said” arguments. You don’t need a 20-page HR handbook. A one-pager in plain English will do.
The Business Case for Compassion
If the legal side doesn’t sway you, here’s the business case:
- Retention: Good employees stay when they feel supported. Bad policies make them leave.
- Reputation: Word spreads fast in small towns and industries. Do you want to be known as the owner who refused maternity leave?
- Productivity: Burned-out employees don’t produce. A few weeks off now might save you six months of underperformance later.
Related: The Employee Onboarding Experience That Doesn’t Feel Like a DMV Visit
Frequently Asked (Panicked) Questions
Q: Can I just call everyone an independent contractor and avoid all this?
A: No. The IRS and DOL love catching misclassifications. The fines are worse than offering leave.
Q: What if my 49th employee gets pregnant, and then I hire one more?
A: Once you hit 50, the law applies. There’s no “grace period.” Congratulations, you’ve joined the big leagues.
Q: Do I have to pay people during FMLA leave?
A: Nope. FMLA is unpaid. But some states layer paid leave on top, and many businesses choose to offer partial pay as a perk.
Q: What if I want to offer leave even if I don’t have to?
A: Then do it. Just make it clear, consistent, and documented. Think of it as an investment in employee loyalty.
Case Studies in Miniature
Case 1: The Coffee Shop Owner
Staff of 12. Barista needs surgery. No FMLA coverage, but the owner gives her three weeks unpaid leave, covers shifts with part-timers, and keeps morale high. Employee returns loyal, customers notice the goodwill.
Case 2: The Marketing Agency
Staff of 60. Designer has a baby. FMLA kicks in, paperwork and all. The owner grumbles, but compliance keeps them safe from lawsuits.
Case 3: The Family Hardware Store
Staff of 8. No formal policy. Cashier’s parent gets sick. Manager denies extended leave, tension explodes, and within two months three employees quit. The business spends more replacing them than it would have cost to cover shifts.
The Bottom Line
If you’ve got fewer than 50 employees, the federal FMLA box doesn’t apply to you. But that doesn’t mean you should bury your head in the sand.
Employees are humans. Humans have families, health issues, and life events. Whether or not the law says so, smart owners plan for it.
Because nothing wrecks morale faster than a boss who treats FMLA like “Fake Leave Made Up.”
