Client Bulletins
What Now? DOL Issues Proposed Regs On FMLA, Asks For Comment On Military Leave

Client Bulletin #382
February 19, 2008

For PDF version of this Client Bulletin, click here

As everyone knows by now, the U.S. Department of Labor has issued its long-promised proposed new regulations regarding the Family and Medical Leave Act. In addition, the DOL has invited comment on the newly enacted “military FMLA” amendments.

The Proposed Regulations (“non-military” FMLA leave)

The DOL has substantially revamped the FMLA regulations, making numerous substantive and editorial changes, and reorganizing many key topics. A point-by-point analysis is beyond the scope of this Bulletin, but overall the proposed regulations appear to be a mixed bag for employers. Some of the changes will be very welcome. The DOL has invited comments in numerous areas, and will accept them through April 11, 2008. Instructions regarding how to comment appear at the end of this Bulletin. Because these are only proposed regulations, Constangy does not recommend that employers change their FMLA policies now. Once the final regulations are issued, Constangy will offer detailed guidance, including workshops, and will revise its Model FMLA Policy consistent with the new regulations.

Although employers should not rush to action, they are well advised to become familiar with the proposed regulations during this notice and comment period so they are ready when the final regulations are issued.

The following are some highlights of the proposed changes:

GENERALLY

Reorganization of the regulations. The regulations are being reorganized in a more logical manner. Those who used the old regulations as a reference know that provisions related to a single topic (for example, substance abuse) were often scattered in different places. The DOL is trying to create a more topical organization, and will also eliminate the “Q&A” format in favor of a more traditional regulatory style.

New forms. The DOL has revamped the notices to be provided to employees requesting FMLA leave, and the medical certification form. Among other things, the proposed regulations explicitly provide that a health care provider can include the employee’s (or family member’s) diagnosis on the medical certification.

New deadlines. The current regulations require an employer to designate leave as FMLA-covered within two business days of the request, or of the time that the employer receives enough information to know that the leave is FMLA-qualifying. Under the proposed regulations, this deadline would be expanded to five business days. In addition, the current regulations provide a deadline of 15 business days for an employee to return a medical certification. Most employers were afraid to truly “cut the cord” after 15 days and often extended the deadlines for weeks or even months. The proposed regulations would keep the 15-day deadline but require that the employer give the employee an additional seven calendar days to cure an “incomplete” or “insufficient” medical certification after the first 15-day period had expired. If the employee failed to meet the 15-plus-7 day deadline, the employer would normally be able to deny FMLA leave. If the employee completely failed to return a medical certification within the 15-day deadline, the employer could normally deny the leave at the expiration of the 15-day period.

COMMUNICATIONS WITH EMPLOYEES

Electronic posting authorized (sometimes). Under the current regulations, government-issued posters inform employees of their basic rights and obligations under the FMLA. Under the proposed regulations, under certain circumstances an electronic posting is permitted. The most significant limitation on electronic posting is that all employees of the employer must have access to computers at work, and all applicants must have access to computers – including the FMLA electronic posting – at job application sites.

Designations of leave. The proposed regulations would incorporate the Supreme Court’s decision in Ragsdale v. Wolverine World Wide, Inc., which provides that under normal circumstances employees do not get a “windfall” of extra FMLA leave just because the employer failed to designate their leave properly. Under the proposed regulations, such a “windfall” applies only if the employee can show that he or she was actually prejudiced by the failure to designate.

On a less positive note, the proposed regulations would require the designation to include the number of days and hours that had been designated as FMLA-qualifying, and if that information is not immediately available, the employer would have to inform the employee every 30 days that the leave had been designated and the amount of FMLA time that had been designated during that 30-day period.

ABSENTEEISM 

Attendance bonuses. One of the most disliked aspects of the current regulations has been its requirement that attendance bonuses be provided to employees whose absences during the relevant time period were FMLA-covered. The proposed regulations recognize the negative impact that this has on employers and also employees, and provide that employers may deny attendance bonuses, as well as other types of bonuses, to employees who were out for FMLA-covered reasons. However, there is a big catch – if the employer pays attendance bonuses to employees who are absent for other reasons (including vacation), then the employer must pay the bonus to employees who are absent because of FMLA leave.

Call-in procedures. The proposed regulations specifically provide that employers may lawfully require employees on FMLA leave to use the employer’s absence reporting procedures and may be held accountable for failing to do so. This is ambiguous in the current regulations.

MEDICAL ISSUES

HIPAA clarification. The proposed regulations provide some guidance on the interaction of HIPAA privacy regulations and the FMLA, and also provide that an employee seeking “serious health condition” leave who refuses to provide a HIPAA authorization to his health care provider may be denied leave.

Medical certifications. In addition to changing the medical certification form, the proposed regulations would allow an employer to provide with the form a listing of the essential functions of the employee’s job, and to ask the health care provider to indicate which specific essential functions the employee cannot perform. The relevant “essential functions” for this purpose must be those in existence at the time that the employee’s FMLA leave would begin.

As stated above, the revised medical certification form would also allow the health care provider to include the employee’s (or family member’s) diagnosis.

Light duty. On the negative side for employers, the current regulations say that time spent performing “voluntary” light duty may be counted toward the employee’s FMLA entitlement. The proposed regulations eliminate this provision, and the comment section indicates that the DOL removed it deliberately. Therefore, the “silence” of the proposed regulations can be construed as meaning that this option is no longer permitted. However, most employers in our experience were loath to do this anyway.

Communication with health care provider. As most employers know, the current regulations require that an employer get “clarification” of a medical certification through its own health care provider. In other words, the employer is not allowed to communicate directly with the health care provider. The proposed regulations allow direct communication between employer and health care provider for this purpose, so long as the employee has provided a HIPAA authorization to the health care provider. (And, as stated above, if the employee refuses, the employer may lawfully deny leave to the employee.) The employee must also have been given the 15-plus-7 opportunity to cure any “incomplete” or “insufficient” areas on the medical certification form before the employer may communicate with the health care provider.

Fitness for duty certifications. The current regulations do not provide an employer with any recourse if it questions whether an employee with a fitness-for-duty certification is really able to return to work safely. The proposed regulations are a slight improvement: they allow the employer to require that the certification address the employee’s ability to perform the essential functions of his or her job (as long as the essential functions were provided to the employee with the original FMLA notice), and the employer is permitted to communicate directly with the health care provider to “authenticate” or “clarify” the information in the certification. In the case of an employee on intermittent or reduced-schedule leave, the employer may require fitness-for-duty certifications as frequently as every 30 days “if reasonable safety concerns exist regarding the employee’s ability to perform his or her duties,” based on the condition that created the need for leave. Like the current regulations, the proposed regulations would not allow second or third opinions with respect to fitness-for-duty certifications.

MISCELLANEOUS

Intermittent/reduced schedule leave – temporary reassignment. The proposed regulations clarify an ambiguity in the current regulations, clearly providing that the “temporary reassignment” option applies only to employees on intermittent or reduced schedule leave that is foreseeable due to planned medical treatment. In other words, employers may not use the “temporary reassignment” option with employees who have unscheduled, unforeseeable absences. This is a negative for employers, but the DOL has invited comment. Employers are encouraged to ask the DOL to allow the “temporary reassignment” option in cases of intermittent leave due to unscheduled, unforeseeable absences at least where regular, reliable attendance is critical to the employee’s position.

Paid leave. The proposed regulations provide that an employee must qualify for and comply with the employer’s procedures regarding paid leave, and may be denied paid leave for failing to do so. The current regulations are ambiguous on this point.

USERRA. The proposed regulations have added provisions reflecting the existing law that employees who are away from work because of reservist or National Guard duty are entitled to be credited with time that they would have worked for the employer but for such duty, for purposes of meeting the 12-month, 1250-hour requirement for FMLA eligibility. (NOTE – this provision is not to be confused with the new “military” FMLA provisions enacted in the NDAA, which are discussed below.)

Waiver of FMLA claims. The DOL has said that a release of FMLA claims in a separation or settlement agreement will be valid. The U.S. Court of Appeals for the Fourth Circuit (the Carolinas, Maryland, Virginia and West Virginia) had held in Taylor v. Progress Energy that such a waiver was valid only with formal approval by the DOL or a court. (It should be noted that prospective waivers – for example, hiring an employee on the condition that she waive her right to leave under the FMLA – would remain void.)

The proposed regulations and the changes they would bring about are extensive, and the above is only a summary of some of the changes that we considered especially noteworthy. To read the regulations in their entirety, click here.

REQUEST FOR COMMENT ON "MILITARY FMLA" PROVISIONS

In addition to the proposed regulations, the DOL requested comment on virtually every aspect of the new “military” FMLA leave recently authorized by the National Defense Authorization Act. The DOL does not know what a “qualifying exigency” should be. That is understandable, because the NDAA provides that the DOL should define “qualifying exigency” and that those provisions will not take effect until it does. But the provisions relating to leave for a service member’s “serious injury or illness” were effective immediately, and the DOL admits that it does not know whether this 26 weeks is a one-time entitlement, or a once-every-12-months’ entitlement. Considering that 26 weeks of leave is half a year, one might say that this is an important missing detail.

But it would be unfair to blame the DOL. The DOL’s regulatory guidance is only as good as the statute that it is interpreting. In this case, the statute is frustratingly ambiguous. Congress should have done its job better, and then maybe the DOL could have.

While the “military” FMLA leave issue is unresolved, Constangy recommends that employers try in good faith to address such requests as they arise but to remain vague in their general communications with employees. We have drafted a “model memorandum” that can be e-mailed to employees or given to them in paper format to include with their employee handbooks or other policy documents. The memo briefly explains “serious injury or illness” and “qualifying exigency” leave and says that the employer is awaiting more guidance from the government but in the meantime will address requests for such leave on a case-by-case basis. The “qualifying exigency” provisions in the memo are highlighted because that portion of the law has yet to take effect. Because it is not yet effective, employers may, if they wish, delete this section from the memorandum before distribution.

Constangy also strongly recommends that any requests for “military” FMLA leave be referred to an experienced human resources professional who is familiar with the developments in this law and who has authority to consult with counsel as needed. This means that “military FMLA” requests might have to be referred to a higher-level human resources professional than non-military FMLA requests.

Many law firms and human resources consultants are issuing “FMLA policies” that include the “military” provisions. We do not recommend that these be used. Too many aspects of this new law are undefined, and a “policy” is likely to contain interpretations that will turn out to be mistaken.

Constangy will keep you up to date on these changes to this very important law. Please don’t hesitate to call us if we can help.

HOW TO COMMENT

Comments on the military and non-military regulations must be received by the DOL on or before April 11, 2008.

To submit your comments electronically, go to the Federal eRulemaking Portal, and follow the instructions, using the identification number RIN 1215-AB35.

To submit your comments by regular mail, send them to Richard M. Brennan, Senior Regulatory Officer, Wage and Hour Division, Employment Standards Administration, U.S. Department of Labor, Room S-3502, 200 Constitution Ave., N.W., Washington, D.C. 20210.

The DOL has requested that comments be submitted either electronically or by regular mail, but not both ways.

If you need assistance complying with the new provisions of the FMLA, please contact any member of Constangy’s Litigation Practice Group or the Constangy attorney of your choice.

Constangy, Brooks & Smith, LLC has counseled employers, exclusively, on labor and employment law matters since 1946. The firm represents Fortune 500 corporations and small companies across the country. More than 100 lawyers work with clients to provide cost-effective legal services and sound preventive advice to enhance the employer-employee relationship. Offices are located in Georgia, South Carolina, North Carolina, Tennessee, Florida, Alabama, Virginia, Missouri, and Texas. For more information about the firm's labor and employment services, visit www.constangy.com, or call toll free at 866-843-9555.