Ten Tips for Leave Management
The environment for leave management has become increasingly complex—and potentially costly to those not in compliance with the growing number of leave laws and regulations. The Family Medical Leave Act (FMLA), Americans with Disabilities Act (ADA), and the myriad of state and local laws have made managing leave, while remaining in legal and regulatory compliance, more difficult and complex.
Leave laws not only create risk. They also create opportunity.
There is good news. A large and growing number of conferences, webinars and other resources are available to help guide risk managers and others through the ever changing leave landscape. DMEC’s recent Compliance Conference addressed many of the issues surrounding leave management and the ever-changing landscape.
During the RIMS annual conference, Karen English of Spring Consulting Group and I offered the following leave management tips at one session.
One: Training is critical. Managers must understand the leave process and their responsibilities under it and the law and uniformly administer leave policies. We don’t expect them to be experts but they need to understand how an employee might evoke their rights under FMLA or ADAA.
Two: HR and other staff must be qualified. Appropriate leave and HR administrators need to be up to date on all absence management programs and be prepared to answer employee questions about their rights for leave and job accommodation.
Three: Collaboration across business units is key. Leave programs across organizational boundaries; HR, disability, legal and other departments need to work collaboratively. Removing barriers between disciplines creates efficiencies and limits liability.
Four: Implement clear and consistent processes and policies. FMLA and ADA policies should be as uniform and applied as consistently as possible across the organization regardless of size or geography, allowing for some flexibility. Stakeholders need to engage with consistent correspondence, tracking, management, decision-making and communication.
Five: Centralize administration of the leave function. Employees and managers should have one source for questions and answers.
Six: Evaluate your program. Inventory the system used, are you tracking or managing your program. If an organization has internal system to manage or track its leave program, it should be regularly evaluated for effectiveness. If you choose a software system or outsource administration make sure that your vendor has ongoing compliance support.
Seven: Outsource if necessary. Outsourcing has increased over the last three years, there are more options than ever, and the list continues to grow. But it doesn’t fit every culture or organization; choose what works best for your company.
Eight: Evaluate your vendor. Just because a company outsources leave management, it does not mean it outsources its legal responsibilities. Even with outsourcing, an organization must establish a process to update its leave programs to meet its changing business and staff needs.
Nine: Measurement, tracking and reporting should be actionable. Key metrics like lost time, costs, return-to-work rates, abuse and productivity are useful to the degree they enable managers to change leave programs to better meet the needs of employees and the organization.
Ten: Create a culture of continual improvement. While legal and regulatory compliance is essential, it is not enough to ensure a leave program helps advance strategic business goals. That requires that managers—and executives–view leave programs as an arena for new investment and training to catalyze change to maximize returns.
Leave laws not only create risk. They also create opportunity.
Planned and implemented in a thoughtful and strategic way, effective leave management can be a competitive advantage in the battle for the best talent. Take advantage of the resources out there and become educated on both the risks and opportunities offered by the new world of employee leave.
In Search of New Absence Management Strategies
Corporate silos separating workers’ compensation departments from the non-occupational disability management side of the house prevail at most companies, although some sophisticated employers are finding efficiencies by coordinating aspects of the two.
Those employers are integrating employee lost-time data, coordinating claims tracking, and transferring best practices from one side of the house to the other.
They are doing so to reduce overall costs, understand employee leave and absence drivers, and to increase productivity, several large employers told the recently held Disability Management Employer Coalition’s annual conference.
PepsiCo, for example, is three years into a program overhaul to eliminate unaccounted for absences, eliminate overpayment of benefits or salaries, and mine its data to learn whether its benefits drive workers to choose between pursuing either workers’ comp or non-occupational disability benefits.
The company traditionally maintained a strong workers’ comp program for managing claims and a solid disability leave management program, said Barbara LaRocque, benefits director at PepsiCo unit Frito-Lay.
“The problem was we had no overlap,” LaRocque said. “One never had anything to do with the other. Instead there was a lot following through the cracks.”
Consequently, the employer was not efficiently returning workers to their jobs even after leave times expired. It required duplicate medical forms to satisfy workers’ comp, disability and Family Medical Leave Act needs, and the company’s human resources department and managers struggled to track employees on leave.
But extensive changes began in 2011.
Among other measures, PepsiCo — with 250,000 workers worldwide and about half of those in the United States — centralized employee reporting through a leave and claim center providing a single point of contact for cases leading to time away from work, whether a workers’ comp claim, disability or leave of absence.
“Our mantra at this point was one phone number to call, one place to go, and one person to talk to who can talk about all aspects of your leave, your pay, your benefits, your employment rights, your status with work comp or disability,” LaRocque said.
The centralized intake helps tightly control the determination of benefits eligibility and the notification of managers and human resources of an employee’s leave status, among other advantages.
Other PepsiCo changes have included clearly defining the responsibilities of employees, managers, and human resources. For example, human resources must now stop an employee’s pay if they do not call to report a leave.
The company has also outsourced and leveraged its use of technology. Third party administrator Sedgwick Claims Management Services Inc.’s claim system, for instance, serves as PepsiCo’s “system of record for all leave activity,” helping the employer track employee time away from work.
The progress has also allowed PepsiCo to collect an abundance of data it plans to use to learn more about how its leave changes are impacting cost savings and productivity, LaRocque said. It will also use the data to help determine whether its benefit offerings and other factors drive employees with injuries to select between filing workers comp claims or disability claims.
Several other large employers told DMEC’s conference, held July 27-30 in Las Vegas, of their efforts to integrate aspects of various programs including wellness and employee assistance offerings and programs for managing short term disabilities, long term disability, workers’ comp and FMLA administration.
TPA Broadspire announced at the conference that it will help further such efforts by adding STD, LTD, and FMLA leave management to its portfolio of products.
Broadspire’s employer clients have increasingly asked for her company expand into providing disability and absence management services to compliments its workers’ comp offerings, said CEO DanielleLisenbey.
There are several factors driving demand for outsourced disability management programs, Broadspire said. Those include an aging workforce expected to increase absences and disability leaves and growing employer responsibility for following state and federal regulatory mandates.