Staying compliant with a dizzying array of federal, state and municipal leave regulations while controlling benefit costs continues to challenge employers.
In fact, according to the results of the 2016 Disability Management Employer Coalition Employer Leave Management Survey, 22% of the more than 1,000 businesses surveyed reported that “keeping up with new federal, state and/or municipal/county laws,” was their organization’s top challenge, rating it as “extremely difficult.” That’s up from 15% in 2015.
As these numbers rise, companies must strategically review their current leave programs, finding gaps and opportunities to supplement existing workflows. One method companies often turn to is outsourcing leave management to a qualified vendor to offset some of the burden, streamline processes and improve compliance.
Not to mention, outsourcing doesn’t have to be an all-or-nothing decision. There are services that allow companies to strategically outsource only certain aspects of leave management programs based on internal capabilities and needs. Companies also can equip their HR professionals with self-administered tools that deliver real-time data on leave regulations that will help their supervisors and managers stay compliant with current regulations and better manage leave across their enterprise, all while appropriately controlling those benefit costs.
Supplementing internal expertise
Managing the complex municipal, state and federal leave programs internally can add to labor costs, particularly as HR professionals are spending countless hours researching regulations and monitoring employees utilizing these programs. Plus, staying up to date can put even more strain and workload on existing teams, taking their time away from other important business tasks.
Employers who have not yet outsourced leave management but are considering it, need to conduct a self-assessment to determine if they have the legal and clinical expertise to interpret and comply numerous leave regulations. Some questions to consider include:
· Do they have knowledge and skills to manage ADA/ADAAA, FMLA and other leave programs?
· Which programs are currently managed internally?
· Which regulations are consuming more time or becoming too complex?
· If self-administration is preferred, what software is available to manage required documentation and keep up with regulatory changes?
· How is the company alerted of precedence-setting litigation that may influence HR policies?
Based on the new audit considerations, employers may discover they have legal expertise, but need a clinical adviser or case manager to ensure total compliance and cost control, for example. Other employers may find a significant uptick in short-term disability management time and resources. Furthermore, multi-state employers may realize they lack relevant state and municipal leave regulatory knowledge outside of their headquarters’ territory.
In such situations, outsourcing and self-administered tools can be highly targeted so that employers can select only the support services they need, which minimizes their costs, but ensures compliance with these programs.
Tools and training to tackle compliance and costs
Due to the constantly-shifting rules, employers need to devote more time and resources to compliance and are devising creative solutions to control those management costs. For example, in 2014, New York City updated its paid sick leave law to grant employees 40 hours of paid sick leave per year. As a result, some employers have switched to awarding 40 hours or more of paid-time off to cover illness, as well as any type of time away from work, including vacation, non-federal holidays and others.
Implementing software tools that track all municipal, state and federal laws associated with these programs can help HR professionals roll with these changes. Such tools also offer digested summaries and guidance that help HR professionals compliantly train and manage supervisors and employees.
Flexible, knowledgeable support
Whatever outsourcing approach an employer chooses to help manage their complex leave programs, they need to select a highly flexible partner that offers as much, or as little, support as the company needs to fill gaps. This advisor should also have a track record of supporting leave program compliance among companies of all sizes and industries.
As most companies will attest, a versatile, qualified leave management partner does reduce these benefit-related costs, but it also offers a peace of mind that cannot be quantified.