Legal Definitions - key employee

A key employee is a salaried employee who is among the highest paid 10 percent of all employees employed by an employer within 75 miles of the employee's worksite. This definition is according to 29 C.F.R. § 825.217.

For instance, if a company has 100 employees within 75 miles of a worksite, the top 10 highest-paid employees would be considered key employees.

Under the Family and Medical Leave Act, an employer may deny job restoration to a key employee if restoring the job would cause "substantial and grievous economic injury to the operations of the employer." This means that if a key employee takes leave under the FMLA, the employer may not be required to give them their job back if it would cause significant financial harm to the company.

For example, if a key employee takes a 12-week leave of absence under the FMLA, and the employer determines that restoring the employee to their previous position would cause significant financial harm to the company, the employer may deny job restoration to that employee.