The Big-Picture View of RiskJanuary 9, 2019
IRS Releases 2019 PublicationsJanuary 14, 2019
The Big-Picture View of RiskJanuary 9, 2019
IRS Releases 2019 PublicationsJanuary 14, 2019
Laura Kerekes writes a monthly “Innovative Workplace” column for Rough Notes, a publication that has been serving the insurance industry since 1878. While written for brokers, the information in her column applies equally to employers. Enjoy her December column on workers’ compensation.
Managing the Intersection of Workers’ Compensation with Other Leave Regulations
You’re ready when the call comes in. Your client’s employee was seriously injured on the job. You reassure the client that your team has them covered, and you outline their workers’ compensation policy provisions, administrative claim filing process, and accident site investigation protocols.
You check in later in the week. As a result of the accident site investigation, the employer’s worksite processes are updated, equipment is modified, and employees are being trained to prevent future accidents like this one. Employee training records are updated, the OSHA injury/illness logs are completed, and the safety team is monitoring the new processes and systems.
The employee is not back to work, but is progressing well with medical treatment and is receiving wage replacement provided by the policy. Everything is well documented so that the client is ready in the event of an OSHA or state safety audit/inspection.
The client appreciates the extra service and professional advice you’ve given to make the best of the unfortunate accident. You’re satisfied that this situation is under control and make a note to follow up with them in the next few weeks. Your job on this claim is done … or is it?
Important Leave Details Cannot be Overlooked
Your goal is to advise your clients of all risks affecting their business, and it’s likely you haven’t spent much time thinking about the impact of uninsurable HR-related business risks or opportunities to mitigate them. In this situation with an injured worker, there are other employment laws and benefits considerations besides state workers’ compensation rules that your client should factor in when managing time off and return to work.
Although workers’ compensation eligibility, coverage, and benefits rules vary from state to state, most employees are covered when the occurrence is job-related. Depending upon the employer size and type of injury or illness suffered by the employee, the employee also may be entitled to medical and/or disability-related protections under two federal laws: the Americans with Disabilities Act (ADA) and the Family and Medical Leave Act (FMLA). To make things even more complicated, some states have enacted their own disability and family and medical leave laws, some of which provide greater amounts of leave and benefits than the federal rules. Failure to look at the entire situation and take these laws into consideration can prove costly to your client.
Counsel your client to consider the following:
- If the employee has a serious health situation requiring time off the job, then FMLA may apply.
- If the employee is disabled, the ADA may apply.
The bottom line is that when employees need time off because of a medical or disability-related issue, it is important to remember that they may have rights under all of these laws at the same (or different) times for the same illness or injury. Each situation needs to be reviewed very carefully, so that the right amounts of time off to manage the condition are provided, and that benefits, compensation, notifications, and other protections are managed.
Avoidable Mistake #1
The most common mistake that employers make with work-related employee injuries/illnesses: Not considering and/or designating FMLA leave concurrently with a workers’ compensation claim. This can result in legal claims for failure to provide benefits, as well as additional costs to the business.
For the claim you just handled, let’s say that the injured employee is off work on temporary total disability for 16 weeks. His doctor then releases him to return to light-duty work, and your client offers him a light-duty job. If they had not properly designated that employee’s time off as FMLA leave, the employee may be able to reject the offer of light-duty work and then be entitled to up to 12 additional weeks of unpaid FMLA leave. Additionally, your client would also be required to keep the employee on their health insurance through those 12 additional weeks of unpaid leave and return him to his former job when he finally returns to full-duty work.
If the client had designated the leave concurrently at the time of the injury, the FMLA job and benefits protections would terminate after the first 12 weeks, while the employee was still on temporary total disability. The employee would then have four more weeks of workers compensation temporary disability, without FMLA protections for additional time off or benefits continuation beyond the wage replacement and benefits provided under workers compensation.
Here’s why: FMLA is a federal law that provides employees up to 12 weeks of unpaid leave per year for specific reasons, including a serious health condition due to a work-related injury or illness. FMLA applies to:
- Private employers with 50 or more employees working within 75 miles of the employee’s worksite; and
- All public agencies and private and public elementary and secondary schools, regardless of the number of employees.
Employees are eligible to take FMLA leave if they have:
- Worked for their employer for at least 12 months;
- Worked for at least 1,250 hours over the 12 months immediately prior to the leave; and
- There are at least 50 employees working within 75 miles of the employee’s worksite.
Note: The 12 months of employment do not need to be consecutive, which means that any time previously worked for the same employer can be used to meet the requirement unless the break in service lasted seven years or more. Some exceptions apply.
Within the context of a work-related injury or illness, the most common serious health conditions that qualify for FMLA leave are:
- Conditions requiring an overnight stay in a hospital or other medical care facility; and
- Conditions that incapacitate the employee for more than three consecutive days and have ongoing medical treatment (either multiple appointments with a healthcare provider, or a single appointment and follow-up care such as prescription medication).
Generally, basic first aid and routine medical care are not included unless hospitalization or other complications arise.
Employers must also consider compliance with state “mini-FMLA” laws that cover an employee’s serious health condition. California, Connecticut, Maine, Oregon, Rhode Island, Vermont, Washington, Wisconsin, and the District of Columbia have enacted medical leave laws impacting private employers. Massachusetts medical leave law provides for leave benefits beginning January 2021, with proposed regulations to be published in March 2019. Other states are considering similar laws.
Avoidable Mistake #2
The second common mistake that employers make with work-related employee injuries/illnesses: Not considering the ADA requirements for entering into an interactive process for reasonably accommodating an employee’s return to work.
The ADA is a federal law that prohibits covered employers from discriminating against people with disabilities in the full range of employment-related activities. Title I of the ADA applies to employers (including state or local governments) with 15 or more employees and to employment agencies, labor organizations, and joint labor-management committees with any number of employees.
The ADA protects individuals with a disability who are qualified for the job, meaning they have the skills and qualifications to carry out the essential functions of the job, with or without accommodations. An individual with a disability is defined as a person who:
- Has a physical or mental impairment that substantially limits one or more major life activities;
- Has a record of such an impairment; or
- Is regarded as having such an impairment.
The ADA does not set out an exhaustive list of conditions covered by the law, making it more difficult for employers to determine with certainty what conditions actually are considered a disability. These conditions require medical interpretation of the severity of the condition by the employee’s healthcare provider, and it is always a best practice to work with medical and legal experts when in doubt. A good rule of thumb to use in reviewing ADA issues is to look at the medical condition in its entirety. Generally, conditions that last for only a few days or weeks and are not substantially limiting with no long-term effect on an individual’s health — such as basic first aid, broken bones, and sprains — are not considered disabilities under the Act.
The ADA does not specifically require employers to provide medical or disability-related leave. However, it does require employers to make reasonable accommodations for qualified employees with disabilities if necessary to perform essential job functions or to benefit from the same opportunities and rights afforded employees without disabilities. Accommodations can include modifications to work schedules, such as leave. There is no set leave period mandated because accommodations depend on individual circumstances and should generally be granted unless doing so would result in “undue hardship” to the employer.
One of the most common questions — and one of the most difficult to answer — is the definition of what is considered a reasonable accommodation.
In the real world, the definition of what is a reasonable accommodation varies and is based on several factors. Examples include: making existing facilities accessible; job restructuring; part-time or modified work schedules; acquiring or modifying equipment; changing tests, training materials, or policies; providing qualified readers or interpreters; or reassignment to a vacant position. Determining what is reasonable and does not cause undue hardship to the business can be difficult, so be sure to consult with experts and provide documentation regarding why an accommodation would be unreasonable for the business.
The Department of Labor (DOL) suggests that every request for reasonable accommodation under the ADA should be evaluated separately to determine if it would impose an undue hardship, taking into account:
- The nature and cost of the accommodation needed;
- The overall financial resources of the company, the number of employees, and the effect on expenses and resources of the business; and
- The overall impact of the accommodation on the business.
There are two issues that arise with returns to work that are risky for employers: (1) 100 percent healed policies and (2) light-duty rules.
Regarding 100 percent healed policies, employers cannot require an employee to be completely healed before returning to work because those rules violate the ADA’s requirements to allow workers to use their right to an accommodation. Even if the employee is not 100 percent healed, he or she could possibly still work effectively with an accommodation.
Employers may create light-duty positions as a reasonable accommodation under the ADA or as part of the return-to-work plan from workers compensation. The goal is to get employees back to work at 100 percent of the productivity that they had before the injury, and there are times when a light-duty position might be the next step, with lighter physical requirements and reduced productivity expectations.
Caution your clients to design the light-duty position to meet the physical requirements of the partially healed worker, so that there will be no physical reason for the employee to refuse the light-duty position.
Under most workers compensation plans, an employee’s refusal to return to work in a light-duty position that meets his or her medical restrictions can result in termination of workers compensation benefits. Additionally, the ADA does not allow an employee to refuse work that meets the physical requirements of the accommodation.
Without that careful look at the duties of the position as they pertain to the employee’s medical needs, however, the employee can refuse the position and continue to collect benefits until he or she is able to perform the requirements of the position.
Steps for Success
While these laws have different goals, medical circumstances create overlaps between them. It is important to understand the rules and benefits in order to manage them correctly and avoid the risk of legal challenges and more expensive or longer leaves.
Advise your clients to:
- Designate FMLA leave for eligible employees concurrently with the workers compensation claim.
- Keep in touch with injured or ill employees throughout their leave.
- Manage pay and benefits according to each situation.
- Carefully evaluate requests for intermittent time off, light duty, or other modified work.
- Consult with your legal advisors and insurance carriers regarding special situations.
- Handle returns to work and reinstatement of benefits in accordance with the laws.
Watch and Learn
Watch a Laura’s webinar, Top 6 Avoidable Leave of Absence Mistakes, to learn more about how avoid the risks inherent in mismanaging the patchwork of different leave policies.