FMLA Outsourcing is on the Rise

The leave management landscape for 2018 is shifting, is your company ready? It is becoming increasingly difficult for employers to keep up and comply with the changing regulations. With additional laws coming into effect, each introducing a new complex state leave and paid leave structure, administering all applicable leaves to the correct federal standard is extremely cumbersome. With this trend, the amount of employers outsourcing FMLA is increasing exponentially, as many companies cannot handle the added responsibility.

According to the Annual Employer Leave Management Survey conducted in 2016 by the Disability Management Employer Coalition (DMEC):

• 34 percent of employers with 50 or more employees outsource FMLA leave to a third-party administrator (TPA).
• 45 percent of employers with 1,000 and more employees do so.

The survey also found that the following areas were deemed to be problematic by many respondents and in some cases, were even mentioned as exceptionally challenging:

• Tracking intermittent FMLA leave (35 percent of respondents).
• Concurrently managing FMLA and ADA leave-taking (30 percent).
• Transferring employees to alternative positions (29 percent).
• Denying leave requests (26 percent).

These commonly reported challenges are similar to common mistakes identified by the Department of Labor (DOL). One is the failure to track FMLA time properly, which aligns very closely to the challenge of tracking FMLA intermittent leave. Often times with intermittent leave, an employee may be taking leave so frequently that it is difficult to ensure all intermittent leave absences are captured and documented. Especially if the employer is manually tracking absences.

Another area of similarity between the DOL and the challenges identified in the DMEC’s survey is not recognizing FMLA and denying leave requests. If an employer’s staff is not adequately trained to recognize FMLA-qualifying leave reasons, this can set the employer up for failure and cause them to deny leave requests which may have otherwise been approved.

Avoid the Pitfalls

Here at BASIC, we have an efficient and fair system that captures all leave requests either via an interactive voice response (IVR) telephone system and/or web-based absence reporting system. Employees submit their absences to BASIC and we identify those which may qualify for FMLA. We then handle the process of sending the necessary paperwork, making the determination on claims, and tracking FMLA time. With our proprietary web-based portals, information is always available 24/7 for  employer and employee access.

More than FMLA

Along with FMLA, BASIC’s service includes concurrent tracking of disability, paid leave, and worker’s compensation. In regards to paid FMLA, BASIC is able to track this with our integrated absence management service. This information can be used and reported, which is helpful for payroll purposes. For short-term disability, BASIC’s system will act as a single intake-hub for employees to submit their requests. When employees submit their absences, we look to see if the employee has the short-term disability benefit and then send out the blank carrier form for completion. Once completed, employees should return the form to BASIC and the carrier which will then save the employer time as they’re not having to send it to the carrier themselves. BASIC is not limited to one carrier as we can work with multiple carriers as needed. Additionally, to help with integration, we are able to provide automatic data feeds to the carriers as well.

We are also able to alleviate the challenge of administering FMLA and ADA leave together, by providing any information we receive regarding restrictions and limitations for ADA to the employer. BASIC can also setup a custom leave that we can track leave as an accommodation. Looking ahead, we are planning to create the ability to have never ending leave; meaning there’s not an allocated amount of time associated with the leave. We’ll also have enhanced tracking capabilities allowing the employer to track work accommodations, aka leave, by employee.

BASIC is an industry leader in FMLA administration. We expertly administer FMLA for over 150,000 employees nationwide. Each client receives access to our proprietary technology and a designated account representative. We keep our clients compliant, and help them to avoid hefty fines and penalties.

Don’t delay, request a proposal on BASIC’s FMLA and Leave Management services today!