What are the regulations for reinstatement of an employee coming back from medical leave?

There is no simple "rule"--rather, there are several rules which interact.

1) Rule 1: if the leave was pursuant to an employment contract or other agreement with the employer (including the terms of a union or collective bargaining agreement), then the terms of that agreement for reinstatement must be honored.

2) Rule 2: an employee cannot be retaliated against for using some form of leave protected by law, such as Family and Medical Leave Act leave. That does not mean he or she can't be demoted, transfered, shifts or hours changed, etc. for other reason--e.g. if there is downsizing, restructuring, etc., the employee can be downsized or restructured; if that employee had performance issues, violated workplace rules or policy, etc., action can be taken; and if the employee cannot, with reasonable accomodation (see below) do their old job anymore, they may be given a new one.

3) Rule 3: An employee cannot be discriminated against because of his or  her disability, if he or she has one. But the employer's obligation is to make a "reasonable accomodation," which means to do something to help the empoloyee if it's not too costly or disruptive. It may be necessary to change ours or duties if the employee can't do the old job, but can do a new one, and this could result in a reduction in pay if the new job doesn't support the same wages; and sometimes, if there's no job the employee can do, he or she can't work there.

If there is retaliation based on having taken protected leave, or improper/illegal discrimination against the disabled, then they may be cause of action and the employee should speak with an employment attorney.