Comments or suggestions?

about this or future e-newsletters.

FMLA: Change on the way?

By Rob Smith, Ceridian manager of Government Relations

Enacted in 1993, the Family and Medical Leave Act (FMLA) aims to accomplish the goal of ensuring that workers are able to take job-protected unpaid leaves of absence in order to attend to their own and their immediate family's medical issues.

Under the FMLA, an employee who has worked for an employer for at least 12 months and 1,250 hours is entitled to up to 12 workweeks of job-protected annual unpaid leave for qualified reasons, including:

• Employee's serious health condition.
• Caring for the employee's child, spouse or parent who has a serious health condition.
• Birth of the employee's child.
• Care of the employee's child up to 12 months following birth.
• Absences relating to the adoption of a child.

As long as these conditions are met, employees are protected from losing their jobs or being demoted in position or salary for using a 12-week period that can be taken intermittently or all at one time.

Time to tighten or expand FMLA?
The FMLA is an important tool in the government's workplace protection role. It also helps stabilize employment for workers who may otherwise have a difficult time keeping a job. After all, who can argue that employees shouldn't be able to take time off when they are sick, have a child or need to care for a seriously ill or injured family member?

Whatever the merits of the FMLA's intentions, the regulations are quite murky. It's often difficult for employers to know exactly what their responsibilities are under the law. It can also be challenging to manage these absences and enforce regulations that employees must abide by when they take FMLA leave.

Overall, an analysis by Darby Associates, a Washington, D.C. research group, on the impact FMLA has had on the economy found that the FMLA costs U.S. businesses and consumers roughly $30 billion each year. And a 2000 survey of employers by a leading absence management services provider found that 54 percent of respondents are not confident that their companies are tracking FMLA absences correctly.

According to a 177-nation survey by the Institute for Health and Social Policy at McGill University, "when it comes to ensuring decent working conditions for families, the latest research shows many U.S. public policies still lag dramatically behind all high-income countries, as well as many middle- and low-income countries." For example, 168 of the countries surveyed offer guaranteed paid leave to women in connection with childbirth. The U.S. does not, which leaves it in the ranks of Lesotho, Liberia, Papua New Guinea and Swaziland.

These findings set up an interesting climate for efforts to amend the FMLA and clearly illustrate the pressures both to expand and contract the law's scope. The Act hasn't been changed since it was enacted in 1993. The Department of Labor (DOL) and many in Congress agree that it's time for an update.

DOL seeks to tighten; Congress favors expansion
Last December, the DOL requested comments from businesses and other interested parties to "provide a basis for ascertaining the effectiveness of the current implementing regulations and the Department's administration of the Act." Meanwhile, workplace issues have gained a lot of traction in the newly minted Democratic Congress, and expanding the FMLA has emerged as a high profile issue.

The DOL received approximately 16,000 comments from respondents ranging from major corporations to school boards to individuals. From the employer perspective, the Society for Human Resource Management's (SHRM) submission provides a useful look into the challenges businesses face in administering FMLA leave.

SHRM represents approximately 210,000 members, including a core membership of HR professionals who administer employee benefits policies, including FMLA leave. SHRM solicited input from members regarding their FMLA issues and received over 4,500 responses. SHRM also conducted a poll of 600 HR professionals on their experiences with the FMLA. Based on this input SHRM developed three recommendations:

• The definition of a "serious health condition" that can qualify a worker for FMLA leave should be clarified and the number of days an employee must be incapacitated to meet this definition should be increased from three to five consecutive business days.
• Employees should be required to provide advance notice of FMLA leave, when they are able.
• Employees should be required to take FMLA leave in half-day increments rather than the partial hour leave they may currently claim.

Overall, more than half of the poll respondents said they found it difficult to determine if an employee's health condition fits the FMLA's definition of a "serious health condition." Industry wide, most of the litigation involving the FMLA stems from the serious health condition definition, which can make businesses wary of turning down an employee's FMLA request, even when it appears that it is not for a legitimate reason.

SHRM recommends that individuals be required to provide advance notice of FMLA leave when possible. This would give employers the opportunity to make arrangements to operate their businesses without the employee. This provision would be particularly important for small businesses where each employee may play a unique role. Two studies by the DOL show that the most common method employers use to cover FMLA absences is to assign mandatory overtime work to other employees. This can be challenging and negatively affect worker satisfaction.

In addition, allowing individuals to take half a day of leave rather than a partial hour would increase employees' pay-loss penalty associated with taking intermittent FMLA leave.

Susan Meisinger, president and CEO of SHRM said that the member feedback they received and the survey results "demonstrate that clearer rules are needed to eliminate the persistent confusion among employees and employers since the FMLA became law 14 years ago."

What does Congress think?
On the legislative side, the FMLA law's original author, Sen. Chris Dodd (D-CT), chairman of the children and families subcommittee of the Senate Health, Education, Labor and Pensions Committee, has proposed expanding the FMLA to apply to a greater number of employers and to employees who have been affected by domestic violence. Most significantly, however, the measure would require employers to provide employees with partial- or full-paid leave for at least six of the 12 weeks of FMLA coverage.

Under current law, the FMLA applies only to employers with 50 or more employees. If Sen. Dodd's proposal were enacted, the law would be extended to employers with 25 or more employees. Sen. Dodd estimates this would provide FMLA coverage for 13 million additional workers.

On March 16, Sen. Edward Kennedy (D-MA) introduced legislation that would require companies with 15 or more employees to offer seven paid sick days of leave per year to care for their own medical needs or the needs of their family.

The paid-leave mandate, unprecedented in federal law, could have major ramifications for private sector leave programs. If enacted, the federal government would, for the first time, require employers to grant paid sick leave to employees for the illness of someone who is not the employee. The new requirement might also interfere with long-standing PDO (Personal Days Off) policies that don't distinguish between vacation and sick leave.

In short, coupled with the DOL's present regulatory interpretations of "serious health condition" and "intermittent leave," a new federal mandate for paid leave could significantly undercut the employer's absence management policies, making Washington, D.C. a full partner in every employer's human resources policies.

Similar legislation is pending in the House. Rep. Carolyn Maloney (D-NY) has introduced a bill that would extend FMLA coverage to businesses with 25 employees or more. It would also allow employees to take up to 24 hours of leave time per year to participate in academic activities at their child's school or to attend a family literacy training program.

What next?
While the FMLA is certainly getting its fair share of attention, it is unclear whether Congress will take any action. The congressional committees that have authority over workplace issues have major "must-pass issues" on their plates this year, including reauthorization of the No Child Left Behind Act. No legislation to amend the FMLA has picked up more than 30 cosponsors in either the House or the Senate.

In spirit, employers agree that employees who have a legitimate medical condition, give birth or have a family member who needs medical care should be able to take an appropriate amount of leave without fear of losing their jobs or being demoted. It's appropriate for the government to provide this protection. And, with the DOL reporting that 89 percent of U.S. businesses aren't covered by the FMLA, it may be reasonable to expand it to apply to more workers.

The government also has a responsibility to ensure that FMLA regulations can be clearly understood and easy for employers to administer. Under the current regulations, the law is applied inconsistently from employer to employer. Businesses have little to no guidance regarding how to enforce FMLA regulations and monitor employees' use of the policy. In the first 10 years that the FMLA was in effect, the DOL regulations were challenged 68 times in court decisions.

At face value, the FMLA is an important, if not essential, worker protection. In practice, it is a vague and confusing policy that leaves employers vulnerable to potential litigation and costly employee absences. These issues could be avoided if the FMLA's intentions were implemented more effectively. If Congress wants to expand the Act to cover more workers, it should first look to the DOL to take the overdue step to correct its existing FMLA regulations.