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Small subsidiary isn’t subject to FMLA if separate from parent

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in FMLA Guidelines,Human Resources,Small Business Tax,Small Business Tax Deduction Strategies

S.P. Richards Co. (SPR), a Smyrna office-supply wholesaler, recently won an FMLA victory when the 1st Circuit Court of Appeals determined it would be considered separately from its parent company, Genuine Parts Co. (GPC).

SPR fired a New Hampshire account representative after she missed a day and a half of work to care for her daughter, who had attempted suicide. The employee filed a claim alleging SPR violated her FMLA rights. SPR argued it was not subject to FMLA because it employs fewer than 50 workers. The employee pointed to parent company GPC, which does meets the size requirements.

But the court ruled that SPR and GPC are separate employers, despite the fact that GPC provides payroll services to SPR. The court noted that they don’t share any common managers and are fully independent companies.

Bottom line: On its own, SPR is too small to be subject to the FMLA’s 50-employee threshold.

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