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Employers Cope With FMLA's Expanded Reach

September 3, 2010
Related Topics: Work/Life Balance, Health and Wellness, Featured Article, Compensation

The Family and Medical Leave Act, long a source of angst between employers and employees, continues to broaden its scope, with the potential for additional regulatory changes before year’s end.

Since early 2009, several steps have been taken to broaden access to the federal law, including extending coverage to military families and, this spring, announcing the law’s applicability to a broader category of parental caregivers, including those of the same sex. U.S. Department of Labor officials also announced in late 2009 that they are reviewing the law’s regulations, including changes made late in the Bush administration, with a projected action date of November 2010.

Meanwhile, a recent court case decided earlier this year put individual human resource managers on notice that they might be personally liable in disputes involving the FMLA. The finding in the district case, Narodetsky v. Cardone Industries, “sends shudders down the spines of human resource directors,” says Charlie Plumb, chair of the labor and employment practice group for McAfee & Taft.

It’s a lot of movement for a 1993 federal law that can attract sharp opinions on both sides.

Advocates for the federal law, which provides for up to 12 weeks of unpaid leave during a 12-month period, describe its job protection as vital for eligible employees who are juggling medical or new parenting issues for themselves or a loved one. But the law also can be confusing and complex to administer, as well as potentially vulnerable to employee abuse, says Gail Scott, a partner at MorningStar Health, which specializes in health and productivity management. “It’s a good law that in some cases has gone awry,” she says.

Recessionary pressures also have upped the ante, according to FMLA experts. Excessive and unpredictable use of the federal law can erode workplace productivity, at a time when it’s most needed, they say. Those stretched-thin employees also may also include human resource staffers themselves, who may be handling FMLA compliance along with other potentially acrimonious employment issues.

“One of the things that’s happened in the last six to 12 months is a flurry of new lawsuits by people who have lost their jobs and are alleging that they were selected for that reduction in force because in the past they had requested or taken FMLA leave,” Plumb says.

With a little additional scrutiny, though, employers can not only support appropriate FMLA requests, but also identify more borderline claims without landing in a courtroom, according to experts in FMLA compliance from the employer side. Among their recommendations: better tracking of absence patterns and rigorous training of frontline supervisors.

 Tracking claims and court cases
From recent data, it’s difficult to get a clear picture of whether FMLA claims are becoming more common. Overall the number of new claims declined slightly, by 7 percent, from 2006 to 2008, according to the most recent survey data available from the National Business Group on Health. And the number of lost workdays related to FMLA remained relatively static over the three years surveyed, with a median of 302 days per 100 covered employees in 2008.

But a smaller employer subgroup, which submitted data continuously over the three-year span, reported an uptick overall. Lost workdays per 100 employees increased from a median of 312 in 2006 to 434 in 2008, according to data provided by 11 employers.

One of the challenges involved in handling FMLA claims is that the law is relatively young and the case law is still developing, Scott says. “It’s a very complex law that, if not administered properly, can put the company at risk for wrongful-discharge suits.”

To date, though, employers have been more successful in the court system, according to one analysis by a University of Connecticut student, which looked at slightly more than 300 appeals court decisions from January 2000 through December 2007. On balance, employers were more likely to win and retaliation was the most frequently filed claim. (The decisions were evenly split on that particular claim.) But employee success has been improving in recent years.

The analysis represents a rare attempt to quantify FMLA experience in the appeals court system, says Steven Wisensale, who advised Samantha Sherwood, the student who conducted the analysis. It also highlights the extent of the litigation surrounding the federal law, says Wisensale, a public policy professor at the University of Connecticut. “I am surprised at how litigious the FMLA has become and how willing corporations are to spend lots of money in court to challenge the employees’ access to it and use of it.”

On the other side of the corporate table, the Narodetsky case is part of a larger trend in employment law, in which human resource managers have been put on notice that they might be held individually liable in regard to hiring and firing decisions, Plumb says. At this point, he says, court decisions are split around the country in regard to FMLA and individual liability.

     But the risk is sufficient that another attorney advises human resource managers to check whether their employer’s insurance policy covers them individually, including for attorney fees. Otherwise, “they may have to go out and hire their own independent attorney,” says Carl Bosland, a Denver attorney who has written three books about the federal law.

 Remaining compliant 
As one strategy to ease FMLA-related stresses, employers are increasingly looking at outsourcing, Scott says. Such a step may be helpful if an employer lacks sufficient staff and expertise on site, Bosland and Plumb agree. But outsourcing doesn’t provide an inherent shield from liability if something goes wrong, they note.

Legal complications can develop, for example, when corporate leaders think they’ve outsourced FMLA but are unaware of some of the informal conversations and decisions that are being made by their frontline supervisors, Bosland says.

“You are either militantly outsourcing or you’re not,” he says. “If you’re not training your supervisors on what to look for, because you’ve outsourced 98 percent of it, your 2 percent is going to get you in trouble.”

Frontline managers should be reminded, repeatedly if necessary, to alert human resources if any employee has been absent longer than three days or if there are recurring absences, Plumb says. “Your supervisors are your eyes and ears out there,” he says, in terms of identifying potentially qualifying FMLA claims.

Since it’s up to the employer to identify a situation that might qualify for FMLA, employers should also consider investing in software that closely tracks absences, Scott says. Ideally, the software will not only track FMLA hours, but also help to flag employee absence patterns that might be eligible for FMLA, she says.

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