You can discipline employees if you discover that they lied about their need foror they seriously misused their leave time. For example, a court recently upheld the firing of a mechanic who played golf during his medical leave and then lied about it later.
But think twice before you lower the boom. What you consider a serious misuse of FMLA time may be judged a less-serious offense by a court. Essentially, you must allow employees to go about the necessary aspects of their daily lives while on FMLA leave. But make clear to employees before they go on FMLA leave that the time should be used for its intended purpose, whether that's to care for their own condition or the serious condition of a relative.
Recent case: A customer service rep with arthritis worked out an arrangement with her employer that allowed her to takeas necessary for her condition. But when the company caught the rep shopping during her leave time, it fired her for misusing FMLA leave.
She sued and won. The district court ruled that the employee used her FMLA leave for its intended purpose, noting that the FMLA contains no requirement that employees on FMLA medical leave must "immediately return home, shut the blinds and emerge only when prepared to return to work." (Jennings v. Mid-American Energy Co., No. 3:02-cv-90069, S.D. Iowa, 2003)