This article was previously published in @Work Magazine for Disability Management Employer Coalition (DMEC).
The many benefits and programs available to employees who need time away from work can be likened to a jigsaw puzzle. And for successful compliance, employers must pay close attention to legal requirements, employee experience and productivity needs.
All too often, managing employee absences is a siloed process. It creates gaps in coverage and job accommodation expectations with other types of protections, such as:
- Disability insurance
- Paid leaves (state/locally required or company provided)
- The federal Family and Medical Leave Act (FMLA) and similar state unpaid leave laws
- The Americans with Disabilities Act (ADA) and similar state and local job accommodation laws
- Workers’ compensation policies
“It is increasingly important for employers to manage these benefits and rights in a cohesive way to avoid confusion and potential liability,” says Megan Holstein, who was head of absence management for Group Benefits at The Hartford at the time of this publication.
Yet in a recent study, 50% of employers said there was no easy way to track and manage different types of leave, as each comes with its own unique considerations, including:1
- Short-term disability (STD) and FMLA eligibility
- Allowable medical information under each program or law
- The benefit calculation and offsets for short-term disability
- Statutory and company paid leave
- Return-to-work restrictions and accommodation considerations
FMLA and Workers’ Compensation
In 2021, a large employer experienced firsthand the legal challenges that can arise from an unintegrated absence management approach when an employee injured her knee on the job.2 The employee filed a workers’ compensation claim, received treatment, got a recommendation for physical therapy and was set to return to “light duty” eight days after her injury. Before she returned, the company required a fitness-for-duty test, which she failed. The employee requested sick time to fully recover and take the test later, but her employer denied the request and terminated her position.
The termination violated her FMLA rights, which could have entitled the employee to more time off to heal. Even though she had only filed for workers’ compensation benefits, the employer was obligated to notify the employee of her rights under the FMLA. She filed a lawsuit against the company for violation of the FMLA and won. This is one of many cases that illustrates the value of taking an integrated approach with situations involving workplace injuries or accommodations, including light duty.
Workers’ Compensation and STD
Consider what happens when an employee submits a workers’ compensation claim that is denied based on the information provided (or lack thereof). The employee, who is unable to work, accesses STD benefits but since workers’ compensation was denied, the employee does not think to indicate that the claim could be work-related. The STD claim is approved, and the employee begins receiving benefits.
Additional information is later provided to the party that handles workers’ compensation claims for the employer, which enables the claim to be reopened and approved. Now, the employee is receiving lost wage benefits under both workers’ compensation and STD, which most employer plans do not permit. The employee may later be asked to reimburse the STD insurance provider, which could prove difficult if the employee has spent the funds. In addition, the employer will be frustrated given the overpayment and potential impact to the claim experience, which could result in repricing of premium obligations.
ADA
In addition to FMLA, state paid family and medical leaves (PFML), workers’ compensation and STD, workers injured on the job are often covered by the ADA. This means they may be eligible for workplace accommodations when they return to work.
The Job Accommodation Network cites many real-life scenarios, including situations in which state workers’ compensation rules do not guarantee a new job when an injury prevents employees from returning to work.3 Remember that under the ADA’s interactive process, an employer should consider reassignment as a possible accommodation.
“The key for employers in all of these examples is awareness, information and communication,” says Allison Scaia, head of health services for The Hartford. “It’s imperative for employers to coordinate benefits and entitlement on active claims to facilitate seamless experiences and identify important trends.”
1 The Hartford. The Hartford’s 2024 Future of Benefits Report, viewed July 2024.
2 United States Court of Appeals for the Eleventh Circuit. Noorjahan Ramji versus Hospital Housekeeping Systems, LLC, viewed July 2024.
3Job Accommodation Network. Workers’ Compensation Topics, viewed July 2024.
The information provided in these materials is intended to be general and advisory in nature. It shall not be considered legal advice. The Hartford does not warrant that the implementation of any view or recommendation contained herein will: (i) result in the elimination of any unsafe conditions at your business locations or with respect to your business operations; or (ii) be an appropriate legal or business practice. The Hartford assumes no responsibility for the control or correction of hazards or legal compliance with respect to your business practices, and the views and recommendations contained herein shall not constitute our undertaking, on your behalf or for the benefit of others, to determine or warrant that your business premises, locations or operations are safe or healthful, or are in compliance with any law, rule or regulation. Readers seeking to resolve specific safety, legal or business issues or concerns related to the information provided in these materials should consult their safety consultant, attorney or business advisors. All information and representations contained herein are as of September 2024.
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