The Family and Medical Leave Act: Still Confounding Employers

By Janet Lee, JD

Counsel
Cigna

By Megan Holstein, JD

SVP Absence and Claims Product
FINEOS Corporation

There’s no denying that the Family and Medical Leave Act (FMLA) has positively impacted the American workforce since its passage 26 years ago. Millions of employees have been able to take leave to bond with a new child, care for a loved one, deal with a serious health condition, or attend to issues relating to a family member’s military service without fear of losing their jobs.

However, for employers, the FMLA may come with downsides such as potential unpredictability in staffing, decreases in productivity, and the possibility of abuse. Complicating matters further are the compliance challenges raised by the FMLA. On paper, the FMLA seems straightforward enough. In the real world, however, administering the FMLA can become very complex.

For example, there’s the issue of determining which employees are FMLA-eligible. The regulations provide seemingly simple eligibility requirements. But with today’s “gig economy” and highly mobile workforce, many questions spring to mind. If an employee was working as an independent contractor prior to become an employee, does the time worked as an independent contractor count toward the 12 months of employment? If the employee works from home and reports to another work-at-home employee, and also travels to different locations for work, which is her worksite? For an overseas employee who was transferred to the United States, should the hours worked abroad be included in calculating whether or not he has met 1,250 hours of service?

These questions — and many more like them — can create compliance headaches. Unfortunately, not all FMLA questions have straightforward answers. Although employers — and employees — hate to hear it, often the answer is some variety of “it depends.” Significant factors to be considered in answering these questions include an employer’s appetite for risk and ability to absorb higher leave utilization rates. Employers who are risk-averse or whose businesses can accommodate flexibility in attendance and productivity levels may choose to administer FMLA in a manner that is employee-friendly and permits leave in circumstances that may not strictly require FMLA protection. However, for employers who are more risk-tolerant or whose businesses are highly dependent on consistent and reliable attendance, a more exacting approach may be appropriate. Either way, when it comes to the FMLA gray areas, employers should understand their options and associated risks in order to make decisions that work from both a legal and business perspective.

Interested in learning more? Join us for our session, What’s Your Appetite for Risk? Compliance Questions with No Good Answers, at the 2019 DMEC FMLA/ADA Employer Compliance Conference to learn tactics for approaching those compliance questions many struggle to answer.