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New approach to FMLA compliance could generate savings

September 3, 2013

Article courtesy of SBAM Approved Partner ASE

Research suggests there is not enough attention given to leaves taken under the Family Medical Leave Act (FMLA), and how they correspond to disability claims which may follow. With a better understanding of the correlation you may be able to manage some health issues and the high cost of FMLA absences. The Integrated Benefits Institute (IBI) recently completed a study encompassing various employers and a total of 520,000 employees, over a five-year period. The results of the study are summarized here.

Historically, employers tend to devote much more energy to FMLA compliance as well as looking for flagrant abuse, than to taking a strategic look at the situation. The main focus of the IBI study focuses on FMLA claims by employees on their own behalf, but family-related leaves were also taken into account.

Key findings of the “Early Warnings: Using FMLA to Understand and Manage Disability Absence” study include the following:

  • FMLA absences are predictive of subsequent disability claims. Specifically, an employee who has had FMLA-based continuous (vs. intermittent) absence is approximately twice as likely to later file a short-term disability claim, than an employee who has not done so.
  • The average length of a disability-related absence is seven to nine days longer for employees who have previously had a continuous FMLA absence. When the previous FMLA absences were intermittent, the average duration of any subsequent disability leave was only one or two days longer.
  • When FMLA absences involved assisting family members with mental health issues, those employees were also more likely than others to file short-term disability claims the following year than those whose family members had physical health problems.
  • Over the five years covered in the study, 24 percent of employees took FMLA leave, 14 percent filed a short term disability claim and one percent filed long-term disability claims (see chart).
  • Employees denied FMLA leave are much more likely to file short term disability claims than those who were not, particularly if it involved the employee’s own health.

Answering the Skeptics

The study’s authors acknowledge some employers might be skeptical about their ability to do much to change the situation. Specifically, employers may believe by the time an employee files an FMLA claim related to his own health, it’s too late to try to help the employee address the health issue without taking leave.

Not necessarily true. First of all, filing an FMLA claim and being granted leave under FMLA are two different things. “Not all employees who request FMLA leave are statutorily eligible even if they have a serious health condition,” the report points out. Also, some legitimate FMLA claims are for intermittent periods of time, providing you with the opportunity to help address the issue when the employee is at work.

So, how can you take advantage of the research findings? A panel of experts recruited by the IBI came up with six basic recommendations to “better manage costs associated with family leave.”

Practical Implications

  1. Link employees with resources. When it becomes apparent an employee is facing a challenging situation through an FMLA leave request, you have a golden opportunity to direct the employee to available resources to minimize the prospect of a subsequent short term disability claim. Depending on the nature of the request, resources could include disease management programs, employee assistance programs or an “ergonomic intervention.”
  2. Consider work continuity options. Begin an immediate discussion with employees about possible job accommodations and stay-at-work programs which might preclude the need for complete absence.
  3. Expand supervisor training. FMLA experts can train supervisors to identify many FMLA claims in the making, and possible ways to nip them in the bud with appropriate interventions. Such training can be followed up with regular sessions with supervisors and benefit experts to keep apprised of situations and offer ongoing support to supervisors.
  4. Maintain contact with employees on leave. Whether they’re on an FMLA or a short term disability leave, staying in touch with such employees keeps them more engaged with their jobs and the company, and can reduce the duration of leave.
  5. Do a better job of educating employees about FMLA. Often employees don’t know much about how the FMLA works until they file a claim — and even then they may be unaware of basic rules. If they are instead given a rundown of their rights and responsibilities early on, this can preclude the filing of inappropriate claims, and save all parties a lot of time and effort. 
  6. For larger employers, coordinate FMLA-related activities of different departments. For example, if you have a benefits department which isn’t in tune with the human resources office or the occupational health department, you’re missing an opportunity to get the best results.

Remember, the 20-year-old FMLA covers private employers with at least 50 employees, but many states have laws which set a lower threshold.

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