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FAMILY MEDICAL LEAVE ACT (FMLA)Administration and Compliance

2009

This material and any accompanying remarks are provided for informational purposes only and nothing contained in either should be taken as a legal opinion or as legal advice.

Copyright 2008 Willis North America, Inc.

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AGENDA

Return to WorkV.

Putting it into Practice

Pay and Benefits

Notification and Certifications

Eligibility and Leave

FMLA Regulations

VI.

IV.

III.

II.

I.

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Family Medical Leave Act (FMLA)

Federal law enacted in 1993Military family leave provisions added in 2008Final revised regulations issued in 2008 and went into effect January 16, 2009Helps employees balance work and familyFederal law allows states to include more expansive provisions

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Who’s Covered?Private employers

50 employees75 road mile radius20 workweeks

State and local governments and most federal employers

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Eligibility BasicsAn employee is eligible for family leave if he/she:

Works for a covered employer• 50 or more employees, either on the same premises or within

75 “road” miles of the worksiteAt least 12 months (does not need to be consecutive)At least 1,250 hours in the past 12 months Eligible purpose

Caution: If an employee begins a non-FMLA leave prior to their 12 months of employment, their leave will become a FMLA leave upon completion of the 12 months, if they have worked 1,250 hours in the past 12 months

Reynolds v. Inter Industry Hired 8/25/05 and requested leave 8/16/05 for Nov

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Reasons for LeaveTraditional FMLAProvides up to 12 workweeks of unpaid leave during a single 12-month period

Birth and/or to care for a newborn child Caring for immediate family members (Spouse, Parent or Child) with a serious health conditionMedical leave for an employee's own serious health conditionPlacement of a child for adoption or foster care

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Serious Health ConditionNew Rule Clarifications

“2 visits to a healthcare provider” must occur within 30 days of the beginning of the period of incapacity with the 1st visit taking place within the 1st seven days of incapacityPeriodic visits under “Chronic serious health condition” defined as at least 2 visits to a healthcare provider per year

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Reasons for LeaveQualifying ExigencyUp to 12 workweeks of unpaid leave during a single 12-month period

Short-notice deploymentMilitary events and related activitiesChildcare and school activitiesFinancial and legal arrangementsCounselingRest and recuperationPost-deployment activitiesAdditional activities not encompassedabove, but agreed by the Employer and Employee.

Servicemembers of Armed Forces' Reserve components or

National Guard or Retired servicemembers of the Armed

Forces or Reserves

Not available for servicemembers who are part of the Regular

Armed Forces.

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Reasons for LeaveMilitary Caregiver

Employees' spouse, child, parent, or next of kin with a serious illness or injury incurred in the line of duty while on active duty as a member of the Armed Forces, including the National Guard or Reserves, and is:

undergoing medical treatment, recuperation, or therapy;assigned as an outpatient to a military medical treatment facility;assigned to a unit providing command and control of Armed Forces' members who are receiving outpatient medical care; oron the temporary disability retired list

Not available for former servicemembers of the Regular Armed Forces, Reserves, or National Guard and servicemembers on the permanent disability retired list

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Calculation Methods

January to DecemberCalendar Year

A “Rolling” 12 month period measured backward from the date an employee uses FMLA leave

Rolling Backward

The 12 month period measured forward from the date any employee’s first FMLA leave begins

Rolling Forward

Any fixed 12 month “leave year” such as a fiscal year, or any year of the employer’s choicePlan Year

Military Caregiver

Leave

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Leave EntitlementMilitary Caregiver Leave

Up to 26 “workweeks” of unpaid leave in a "single 12-month period" Begins on the first day the eligible employee takes FMLA leave to care for a covered servicemember – rolling forward method, regardless of the method used for other FMLA reasonsEntitled to a combined total of 26 workweeks of leave for any FMLA-qualifying reason during the "single 12-month period" No more than 12 weeks for other leaves, even if employee only uses 8 weeks of Military Caregiver Leave

Example: Employee may take 16 weeks of Military Caregiver leave and 12 weeks for birth of a child, but they may not take 12 weeks of Military Caregiver leave and 16 weeks for birth of a child

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Intermittent and Reduced Leave

Employee or Family member Serious health conditions, Military Caregiver leave and active duty leave Employer does not have to consent for bondingMinimize work disruptionsEmployers can deduct from wages paid to exempt employeesRequired overtime

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When both Spouses are EmployedNo more than 12 weeks of FMLA leave in a year between spouses

Newly arrived childFoster care placementCare for a parent witha serious health conditionQualifying Exigency

No more than 26 weeks of FMLA leave in a year between spouses

Military Caregiver

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AGENDA

Return to WorkV.

Putting it into Practice

Pay and Benefits

Notification and Certifications

Eligibility and Leave

FMLA Regulations

VI.

IV.

III.

II.

I.

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Employee NoticeMurphy v. FedEx National

Susan and Paul Murphy worked at Watkins Motor Lines, which is bought by FedExAt the time of the acquisition, Paul was on FMLA leave for a serious medical condition, and Susan was on leave to care for him.Paul take FMLA leave for his own serious health condition and Susan takes FMLA leave to take care of himWhile on leave Paul passed away and Susan notified her supervisor of her husband's death and was crying and emotional during the phone call. Susan’s supervisor asked her how much additional time she would need before returning to work, and told the her it would "not be a problem" for her to take an additional 30 days off; he said he would talk to Human Resources Susan was sent a letter a week later that terminated her

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Employee Notice30 days notice if foreseeable or “as soon as practicable” where leave is not foreseeable (same day or next business day)

Not required to give you notice in person.Not required to explicitly ask for “FMLA leave”, “family leave” or “medical leave”… but must explain the reason for the needed leavePreviously provided FMLA-protected leave MUST be referencedUsual and customary notice and procedural requirements for requesting leave, absent unusual circumstancesMay be delayed or denied

Best PracticeRequire the request for leave be in writing, in your policy.Train Manager and SupervisorsConsider centralized intake of leave request

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Employer NotificationRequired

PosterEmployee handbook or other Employee distributionEligibility Notice and Rights & Responsibilities Notice (DOL Form WH-381)Designation Notice (DOL Form WH-382)

RecommendedTrain Managers and Supervisors

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Eligibility Notice and Rights & Responsibilities

Employer must be provided within FIVE business days and include specific expectations

Medical certificationRight to substitute paid leaveBenefit premiumsJob restoration rightsFitness for Duty requirementsKey Employee status

DOL Form WH-381

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Certifications

15 Day to completeEmployee’s Serious Health Condition(DOL Form WH-380-E)Family Member’s Serious Health Condition (DOL Form WH-380-F)Qualifying Exigency (DOL Form WH-384)Serious Injury or Illness of Covered Servicemember (DOL Form WH-385)

One of the most powerful tools in curbing abuse is the use of the medical certification form

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Employee and Family CertificationsComplete and sufficient certification

Shall state in writing what additional information is necessary to make the certification complete and sufficient and give employee Seven calendar days to fix

Clarification and authenticationHuman resources professional, a leave administrator or a management official, never direct supervisorEmployee’s permission not needed to contact HCP for verificationEmployer must obtain employee’s authorization for clarification of “individually-identifiable” health information, consistent with HIPAA

Best PracticeAdvise an employee of the anticipated consequences of an employee's failure to provide adequate certification… may deny the taking of FMLA leave Exercise rights of second and third opinion

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CertificationsMilitary family leave

Verification with third Party allowed without employee permission for Qualifying ExigencyMay not utilize the second or third opinion process with Military Caregiver leave

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RecertificationIf duration is more than 30 days, an employer must wait until that minimum duration expires before requesting a recertification In all cases, an employer may request a recertification of a medical condition every six monthsLess than 30 days• Employee requests an extension of leave• Circumstances described by the previous

certification have changed significantly• Doubt stated reason for the absence or

the continuing validity of the certification

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Designation NoticeProvided to the employee within FIVE business days• Use of accrued paid leave• Requirement of FFDMay be provided at same time as Eligibility and Rights and Responsibilities Notice

DOL Form WH-382

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Retroactive DesignationEmployer may retroactively designate leave as FMLA leave

Does not cause harm or injury to the employeeIn all cases where leave would qualify for FMLA protections, an employer and an employee can mutually agree that leave be retroactively designated as FMLA leave

Best PracticeTry to avoid retroactive designation, by establishing systems toensure proper administration

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AGENDA

Return to WorkV.

Putting it into Practice

Pay and Benefits

Notification and Certifications

Eligibility and Leave

FMLA Regulations

VI.

IV.

III.

II.

I.

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Substitution of Paid Leave

Employers can require employees to substitute accrued paid leave while on unpaid leaveEmployees can elect substitution of paid leaveEnsure consistency with your paid leave policiesEmployers and employees may agree to have paid leave supplement the disability plan benefits, such as in the case where a plan only provides replacement income for two-thirds of an employee's salary.

Best Practices Require use of PTO, Vacation, Sick, etc. when on unpaid leaveDo not allow for more than 100% of pay

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Required to maintain group health insurance coverage on the same terms as if the employee continued to workNot required where employee purchases individual policiesMust reinstate without any qualifying periods, pre-existing conditions, etc.Eligible for any changes or new benefits

PaymentsPaid leave continue to take as normal Same time as payroll or COBRAPre-payment (Option Only)Employer’s existing rules for payment by employees on “leave without pay” as long as not required pre-payment

Maintenance of Benefits

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Benefit Obligation Stops When…

Intent not to return to work at the end of the leave periodFails to return to work when the leave entitlement is exhaustedPosition eliminationPremium payment is more than 30 days late• Employer MUST give the employee at least 15 days written

notice that coverage will cease if payment is not received• If employers established policy allows for retroactive termination

then allowed, if not coverage termination after 30-day grace period

Best Practice: Send a letter on the 15th day that payment is late informing employee that payment not received by 30th day will result in termination of benefits.

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Recovery of Benefit CostMay recover employee’s share of any missed premium paymentsEmployer may collect 100% of premiums if the employee fails to return to work • Returns but fails to work 30 calendar days after returning Caution: Except, beyond the control of the employee or due to the continuation, recurrence, or onset of a serious health condition• May require medial certification• Failure to provide medical certification within 30 days or the

reason is not beyond the employees control

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Proceed with CautionBenefits reinstatement must be without

waiting periods, exclusions or qualifying exams.

Best Practice: Before terminating an employee from coverage, check with your carriers.

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AGENDA

Return to WorkV.

Putting it into Practice

Pay and Benefits

Notification and Certifications

Eligibility and Leave

FMLA Regulations

VI.

IV.

III.

II.

I.

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Job RestorationRestore to same or equivalent job

Comparable pay, Benefits, and Other employment terms and conditions

Timing of ReinstatementAgreed upon dateTwo business days of notice, if date differs from agreed date

Caution: An individual who becomes disabled may be entitled to reasonable accommodation of his/her disability and other rights under disability discrimination laws (ADA).

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“Key” Employee

Highest paid 10% of all employees employed by the employer within 75 miles of the employee’s worksite“Substantial and grievous economic injury” to the operations if reinstated

To invoke the key employee exception, employers must: notify the employee of status as a key employee;notify as soon determined and explain the reasons for the denial; offer reasonable opportunity to return to work make a final determination at the end of the leave period.

Send notification via “certified Mail” (or use DOL form)

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Fitness for Duty Medical Release

Regarding only the specific health condition for which the employee was on leave

Uniform policy and practice

Employee's ability to perform the essential functions of the employee's job

Must provide an employee with a list of the essential functions of the employee's job no later than with the designation notice

The employee picks up the tab for the initial certification

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AGENDA

Return to WorkV.

Putting it into Practice

Pay and Benefits

Notification and Certifications

Eligibility and Leave

FMLA Regulations

VI.

IV.

III.

II.

I.

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Importance of a PolicyTerminated four days before returning to work after the birth of her childEmployer did not have 50 employees within 75 miles of the employee’s workplace

Company Policy“Employees who satisfy all of the following requirements are eligible for FMLA leave: • The employee has actively worked for the company for at least 12

months as of the first day of FMLA Leave. The 12 months need not be consecutive

• The employee has worked at least 1,250 hours…during the 12 month period immediately preceding the first day of FMLA leave”

The handbook did not include a reference to the “50/75” rule. In addition, representatives of the employer told the employee that she could have FMLA leave for the birth of her child.

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Review Your PolicyGather information before you start the review…

Current policies and individual agreements• Absence control • Paid time off • Leaves of Absence policy • Insurance policies• Short term and Long term disability • Workers’ compensationInternal forms relating to leaves Current and new FMLA policies, posters, forms and letters

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Review Your PolicyBest PracticePolicy

Specify premium collection method for unpaid timeEmployee failure to pay health plan premium paymentsEmployer recovery of benefit costs

Medical and other benefits

Require use of accrued paid leave during unpaid FMLA leave

No more than 100 percent of an employee’s salary

Substitution of paid time off for unpaid leave

No more leave than requiredRolling backwards methodRolling forward for Military caregiver leave

Amount of leave Calculation method

Only provide FMLA leave for Employees and events that qualify as FMLA

Include new regulations

Employee eligibilityQualifying events

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Review Your Policy

Required completed within 15 days2nd and 3rd opinionRecertificationFailure to provide

Certification

May temporarily transferMutually agree for birth / adoption

Intermittent and Reduced-Schedule Leave

Require in writing 30 days in advancedEmployee Responsibilities When Requesting FMLA Leave

Employee’s right to reinstatementRequire a Fitness for Duty CertificationKey Employee

Employee right to reinstatement

Best PracticesPolicy

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Policy RecommendationsRun all leaves, including workers compensation that qualify for FMLA concurrentlyCreate a policy for leaves outside of FMLA …even if the policy is there is no leaveAdministrative Separation Policy• Set period of time to act as a “stop gap”• Apply to all leaves of absence CONSISTENTLY• Check state laws for exceptionsInclude a policy that prevent outside workDo not forget to review any applicable State laws • Paid Sick Leave• Pregnancy Disability Leave• Maternity / Paternity Leave• School Activities LeaveDo not become too generous and do not make exceptions

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In ClosingNotify Employees of their FMLA rights

Update and publish your FMLA Policy in your Employee HandbookFMLA Poster (DOL)

Ensure you have the following forms and lettersDOL Forms: Certification (s), Eligibility and Rights & Responsibilities Notice, Designation Notice (DOL)Create an Application for FMLAFitness for Duty / Medical ReleaseLetter to Collect PremiumLetter about exhaustion of FMLA and options

Train managers and supervisors on FMLA

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In ClosingSystem or Checklist for processing / tracking the leave

Employee NameReason for leaveDates of leaveKey employee statusPaid time off substitutionBenefits and premium collectionMedical certification / recertificationCommunication / Mailings / Key Dates

Maintain records in accordance with DOL regulations DOL website 825.500Keep medical files confidential

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QUESTIONS AND ANSWERS