Short-term disability insurance versus the Family Medical Leave Act (FMLA): what is the difference? Employees frequently ask this question while sick, injured, or pregnant and unable to work.

One may replace a portion of income while you are not working while the other may protect your job and access to health insurance benefits.

Examine four primary comparison categories to understand how the two vary.

  1. Proactive versus reactive paperwork requirements
  2. Paid versus unpaid leave benefits
  3. Private policy versus federal regulation
  4. 24-month versus 12-week length

Short-Term Disability Insurance

The first step in comparing short-term disability insurance versus the Family Medical Leave Act (FMLA) is to examine the first half of the combination. Short-term disability has unique paperwork, primary benefits, length of leave definitions, and origins.

Paperwork Requirements

Short-term disability insurance requires proactive paperwork, whereas FMLA does not. Most people must complete a policy application form before becoming sick, hurt, or pregnant in order to qualify for benefits.

Apply for a short-term loan to fund your leave if you did not complete this critical paperwork before the need arose. Every policy contains a twelve-month exclusion for preexisting conditions.

A small portion of workers is more fortunate. Either they work in one of five states with a mandatory temporary disability program, their employer bought coverage on their behalf, or they took the proactive step to enroll themselves. For this group, the claims paperwork involves signatures from both a doctor and the employer.

Primary Benefits

Short-term disability insurance replaces a portion of income while FMLA does not. It applies during the time that a policyholder is unable to perform the material duties of his or her primary occupation, due to a covered medical condition.

These policies do not protect your job, guarantee continued access to your health insurance, or replace income to care for a sick family member.

Length of Leave

The length of leave for short-term disability insurance varies by the policy features chosen at time of application, whereas the FMLA length is fixed. Two common features determine how long the policy will make claims payments: the elimination period, and the benefits period.

  1. The elimination period defines how quickly claims payments begin. Policyholders may have a waiting period of 0, 7, 14, 30, or 90 days.
  2. The benefits period defines how long the claims payments may last while the policyholder is unable to work. Claims payments may continue for 3, 6, 12, or 24 months.

Private Policy

Private insurance companies offer short-term disability to groups and individuals, whereas FMLA is government enforced. Forty-five states do not have any regulations requiring employers to offer an option, or purchase the coverage on behalf of employees. It is a voluntary program requiring proactive action.

Five states have mandatory programs (California, Hawaii, New Jersey, New York, and Rhode Island). Most private employers must follow the mandate. However, most state and federal government employers are exempt.

Family Medical Leave Act (FMLA)

The second step in comparing short-term disability insurance to the Family Medical Leave Act (FMLA) is to explore the second half of the equation. FMLA also has unique paperwork requirements, primary benefits, length of leave rules, and origins

Paperwork Requirements

FMLA paperwork requirements are reactive, whereas short-term disability requirements are proactive. Workers do not need to complete a policy application months or years in advance of a possible need.

Qualifying employees simply need to complete the paperwork only after they become disabled. A doctor must certify the medical reason.

Primary Benefits

The primary benefits of FMLA are job protection, and continued access to health insurance, whereas short-term disability only replaces income. FMLA provides for unpaid leave and wills income replacement up to the individual, or state.

Length of Leave

The length of leave for FMLA caps out at 12-weeks, whereas short-term disability can range up to 24 months. Qualified workers can take up to 12-weeks of leave during any 12-month period.

Qualified employees can also take advantage of FMLA to care for a sick family member, whereas short-term disability applies only to the policyholder.

Federal Regulation

FMLA is a federal regulation, which applies to qualifying workers, whereas short-term disability is primarily a private program left up to individuals – except in five states with a mandatory program.

FMLA applies in all fifty states. However, the job-protected leave is not available to all workers. The employer has to meet eligibility criteria: fifty employees working within a 75-mile radius. Workers must meet eligibility requirements based upon hours worked: 1,250 hours during the previous 12-months.