Immediate Family: An Overview
Most of us know how we define "immediate family" in our own minds, but our views of the matter may not matter when it comes to its definition in the fine print of legal documents or company policies. In general, a person's immediate family is his or her smallest family unit, including parents, siblings, spouse, and children. It may include relatives through marriage, such as a mother-in-law. But the exact inclusions may differ depending on the law or organization that defines an individual's immediate family.
The definition of an immediate family can affect whether a person can use paid or unpaid leave to care for a sick family member or attend a funeral. It also can restrict some financial transactions, especially those involving the stock market.
Understanding Immediate Family
- Immediate family usually consists of parents, siblings, spouse, and children.
- Who is considered immediate family matters in situations such as a company's family leave policy.
- The Family Leave Medical Act, for example, defines immediate family as your spouse, parents, and dependant children.
The definition of an immediate family can be murky because, unless a specific law is involved, it’s up to companies, organizations, and policy-makers to make their own rules.
Medical Leave and the Immediate Family
For example, companies with 50 or more employees must comply with the federal Family Medical Leave Act (FMLA). The FMLA requires that up to 12 weeks of unpaid, job-protected leave be given to employees who need to care for a sick member of their immediate family.
The act in this case broadly generally defines that as a spouse, parent, or minor child. Notably, it does not mention an adult independent child or a grandparent, not to mention a more distantly related family member who may live with you or depend on you for assistance.
The fine print in the law further specifies that the leave must be extended to care for children under age 18 or unable to care for themselves, and it includes adopted and foster children. In-laws are excluded, even if they live with the employee.
As another example, federal law does not require a company to give its employees paid bereavement leave when they attend a funeral for a family member. Many companies choose to offer this benefit anyway, but they are free to define family members in any way they choose.
The Stock Markets and Immediate Family
The Financial Industry Regulatory Authority (FINRA) is responsible for preventing corrupt practices in the financial markets. For instance, it prohibits brokers from selling hot issues such as initial public offering (IPO) shares to members of their immediate families.
As such, its Rules of Fair Practice include a strict definition of what constitutes an immediate family member. In this case, it includes all in-laws and anyone who relies on the person for material support. Rules governing transactions with a person's immediate family also are noted in FINRA's concepts of withholding and free-riding.
How to Protect Your Immediate Family
Given the ambiguity, it's wise for everyone to consider making sure that all of the members of their immediate families, as they define them, are protected. A few considerations:
- Make sure that you have a will, and that it specifies who gets what. Every state has its own inheritance laws, and you want to make sure that your assets are awarded to the family member or members that you want to have them.
- Check other key documents including all financial accounts to make sure you have correctly identified the beneficiaries of your assets, and make sure you keep this information up to date.
- Read the fine print in your company's employee manual to determine how it defines your immediate family, particularly in that Family Leave Act provision. The policy may be negotiable if you are responsible for a mother-in-law or other family member not defined as "immediate" by law.