labor lawAdivision of labor law center

Employers in Connecticut and nationwide need to be aware of a new labor law posting requirement, the Military Family Leave notice.

Prior to President George W. Bush signing the National Defense Authorization Act (NDAA) on January 28, 2008, FMLA (Family and Medical Leave Act) leave was available only to care for a parent, son or spouse, and only for 12 weeks.

The 2008 NDAA includes a provision to expand FMLA for military families from 12 weeks to 26 weeks. The new law also expands the definition of family to include in-laws, cousins, aunts and uncles.

As a result, when a member of the National Guard, Reserve or active military id is under medical care, that person’s family is eligible to take up to 26 weeks of FMLA leave to care for him or her. Conditions included in the law are outpatient treatments, therapy (physical or mental), and temporary disability resulting from illness or injury.

According to the U.S. Department of Labor, when a member of the military is called to active duty, the expanded FMLA also allows the family member to act as a substitute for anyone in that soldier’s care. Under the new rules, a soldier’s “next of kin” can take FMLA to care for him or her, even when that next-of-kin may be an uncle, aunt or cousin.

Although the 2008 NDAA went into effect immediately, the detailed regulations haven’t been issued. The Secretary of Labor asks companies to grant leave to eligible families in an “act of good faith” until the finalized regulations are published.

With the new law, the U. S. Department of Labor mandates that all companies display the new Military Family Leave poster immediately. The poster should be placed in a permanent position that is visible to all workers. The Wage and Hour Division enforces this law. Employers that fail to comply will be subject to penalties.

More Connecticut Military Family Leave Notice

The Family and Medical Leave Act (FMLA) was enacted in 1993. This ground-breaking federal law allowed a worker with a serious illness to take off up to 12 weeks of unpaid leave. Also, upon return, the employer had to give the worker the same job, or another position with comparable working conditions, salary, benefits and duties.

Prior to the FMLA, an employee who fell ill could easily lose his or her job. Each case was handled individually, and policy for handling these cases varied among companies. Often, if a worker missed more than a couple of weeks, the employer terminated him or her.

The FMLA changed that, but not for every employer and employee in the United States. Some eligibility requirements must first be met before taking or granting FMLA leave. First, the company must have 50 or more workers within a 75 mile radius of the work site. Second, the employee must have worked for that company for 12 consecutive months, and logged at least 1,250 hours.

Once eligible, the worker can take FMLA leave for himself, to care for an ill spouse, parent or child. Employees can also take FMLA leave to care for a newborn child, a child newly adopted, or a child under age 18 that’s newly fostered.

Until 2008, the FMLA remained the same. The recent signing of the NDAA (National Defense Authorization Act) on January 28, 2008, will expand FMLA leave, but regulations are yet to be finalized. Once the U. S. Department of Labor publishes the final regulations, the changes in the NDAA will become law.

A few changes to the FMLA were published on February 11, 2008. These changes update the certification process, and expand the time employers have to notify workers of their FMLA rights.

On of these revisions is major. Previously, an employee could take FMLA leave without giving advance notice. The new regulations will require employees to follow their company’s standard practices regarding taking leave, which usually means the worker must advise the employer of his or her absence, prior to the beginning to the shift.

The U.S. Department of Labor is proposing a series of changes to the FMLA rules.

The changes, which will affect Connecticut employers, were announced February 11, 2008. Employers may comment on the changes until April 11, 2008, after which the new rules take effect.

To add comments, click this link and enter keywords “Family and Medical Leave Act,” including the quotation marks. It is important for employers to realize that all contact information they include will be available for viewing by the public.

Among the changes to FMLA are one that would broaden the scope for “substitution of paid leave for FMLA,” and another that would allow employers to count FMLA leave as absent time when awarding “perfect attendance” certificates and bonuses.

The second seems relatively unimportant but answers a longstanding complaint. In the old rules, an employer could not count FMLA leave as part of a worker’s absences.

Both employers and coworkers objected that some workers got “perfect attendance awards” and occasionally even bonuses, despite the fact that they had taken all or part of their 12 weeks of FMLA leave. The new regulations allow employers to evaluate an employee’s attendance record by treating FMLA leave like any other absence.

Regarding the changes to “substitution of paid leave,” the Act says employers do not need to pay workers on FMLA leave. The statute does, however permit employees to take accrued paid sick time concurrently with FMLA. Employers may in turn require workers to take sick time concurrently with FMLA.

Under the proposed new regulations, employees could use accrued vacation, personal leave, and paid time off (PTO) as part of FMLA leave, provided they meet their employer’s criteria. The employer may, in turn, require employees to use all types of accrued paid time off as part of the FMLA leave.

Currently, a worker who accumulated 2 weeks of sick time, 3 weeks of personal leave, and 5 weeks of vacation time (a total of 10) may only use the 2 weeks of sick time as FMLA. Under the changes, he or she could use all 10 paid weeks off as part of FMLA.

More Connecticut FMLA Changes

The Family and Medical Leave Act (FMLA) guarantees a worker the right to take up to 12 weeks of unpaid leave yearly if he or she has a “serious medical condition,” or if a member of the immediate family has one.

One of the definitions of “serious medical condition” (it is only one of 6 definitions) requires more than 3 consecutive days of incapacity plus “two visits to a health care provider.”

The law provides no definition, however, for “two visits.” It could be 2 in a month or 2 in a year. The Tenth Circuit Court ruled on one occasion that the two visits must take place during the 3 days of incapacity.

New proposed changes to the FMLA would clarify the rule. The 2 visits must take place within 30 days of the incapacity.

This is just one of many proposed changes to the FMLA regulations published by the U.S. Labor Department on February 11, 2008. There will be a public comment on the proposals until April 11. At that time, the proposals will be published as final, and employers must then comply with them as law.

Several of the changes proposed would address this concept of “serious health condition” and a condition’s medical certification.

Other rulings include consideration of the “Ragsdale” decision on employer penalties, a decision that light duty does not count as FMLA leave, and the guarantee of an employee’s right to settle FMLA cases out of court. The changes would allow the substitution of paid leave if an employee qualifies, and it would permit employers to withhold “Perfect Attendance Awards” to workers who have taken FMLA leave. They would also make changes to the “fitness-for-duty” certification to return to the job.

“It’s time to update these regulations,” said Victoria Lipnic of the U.S. Labor Department, “to reflect court decisions, clear up ambiguities and address issues that weren’t contemplated when the regulations were first issued in 1995.”

She noted as well that the proposals follow “a thoughtful, careful process that included a Request for Information with 15,000 public comments in 2006, many conversations with stakeholders, and the department’s experience in administering and enforcing the law.”

A recent U.S. Department of Labor lawsuit has forced a New Britain, Connecticut company to repay $2.1 million to the company’s retirement plan.

Macristy Industries Inc. and the company president have paid the full amount under a consent judgment and a court order resolving the lawsuit, which alleged violations of the Employee Retirement Income Security Act (ERISA).

According to U.S. Secretary of Labor Elaine Chao, “Workers’ retirement plans are not piggy banks for company executives.” She added, “This legal action restores $2.1 million to these workers’ retirement plan and prohibits the company’s president from ever again serving as a fiduciary of an ERISA-covered employee benefits plan.”

The suit was filed in January, 2007 in the U.S. District Court for Connecticut. It alleged that between 2002 and the present, the defendants improperly transferred up to $2,597,000 in plan assets to company bank accounts. In effect, the company tried to solve its cash flow problems by raiding the employee’s retirement fund. The suit also claims that the company either filed false annual reports or failed to file the annual reports required by law. The reports would have detailed the retirement fund’s financial status to the U.S. Department of Labor, and indicated any problems.

According to the U.S. Department of Labor allegations, the company and its president used some $773,186 for legitimate plan benefits and expenses. The majority of the funds, however, were diverted to pay for normal company operating expenses. This amounted to about $1,823,813 that was misused.

Macristy Industries Inc. is a holding company that owns Connecticut Stamping and Bending Inc., Tube Bends Inc., The Sunrise Realty Corp. and Plumb E-Z Manufacturing Co. The company maintains a cash balance retirement plan for 286 participants.

The defendants acknowledged restoring $1.1 million to the plan after the Labor Department filed its suit. In addition, they have agreed to pay back an additional $1 million to the plan under the current legal settlement. Macristy’s president has resigned as fiduciary to the plan. The court order appointed an independent trustee to manage the plan, and mandated that an actuary be retained to determine the current funding status of the plan. Both of those actions have been completed, according to sources at the U.S. Department of Labor.

In addition, the order prohibits the company president from serving as a fiduciary or service provider to any ERISA-covered plan in the future, and requires the company to pay the costs of the independent trustee. The defendants also were ordered to file all required Form 5500 annual reports as soon as possible. In addition, they must file Form 5330 with the Internal Revenue Service and pay any civil penalties assessed by the U.S. Department of Labor.

This case was first investigated by the Boston Regional Office of the U.S. Labor Department’s Employee Benefits Security Administration (EBSA). The EBSA enforces regulations regarding private sector pension and health plans.

While a number of companies have tried to raid retirement funds in recent years, the U.S. Department of Labor prevents such conduct, and punishes the wrongdoers. In 2006, the EBSA recovered more than $1.4 billion related to pension, 401(k), health and other benefits for millions of American workers and their families. Most of those funds were retirement benefits that had been misappropriated by companies.

The Employee Benefits Security Administration (EBSA) is committed to educating and assisting the 150 million Americans covered by more than 700,000 private retirement plans. In addition, this busy agency also assists Americans covered by more than 2.5 million healthcare plans, and a similar numbers of other welfare benefit plans. The agency, originally founded as the PWBA also assists plan sponsors and answers questions from members of the employee benefits community. EBSA promotes voluntary compliance and facilitates self-regulation, working diligently to provide quality assistance to plan participants and beneficiaries. 

A bill requiring that mental health benefit limits equal those for surgery and other medical procedures has been extended again, this time until the end of 2007.

The ruling affects all employers whose health plans include mental health benefits.

The extension of the Mental Health Parity Act, known as the MHPA, will have a major impact on Connecticut employee benefit packages. Nationwide, it applies to more than 150 million employees.

The law does not demand that employers’ health plans must cover mental health – only that if a plan has mental health coverage, it should be on a par with surgical or other medical treatments. The payment limits must be the same.

The Employee Benefits Security Administration, or EBSA, issued the ruling. The agency is the watchdog group guaranteeing adherence to health insurance and pension law compliance.

The law was originally enacted in 1996, and through a “sunset clause” expired on September 31 of 2001. Five amendments have extended that expiration date since then. The new ruling received little attention when it was released recently.

In requiring parity between mental and physical health plans, the MHPA says in essence that group health insurance plans must not put a lower limit on payments for mental health coverage than for it does other coverage. In short, it is illegal for a health insurance plan, for example, which sets a maximum benefit of $250,000 for surgery and $15,000 for treatment in the mental health field. Under the law, the mental health coverage limit must also be $250,000.

The law puts the same restrictions on annual caps of benefits. In short, mental health coverage must equal the lifetime or annual caps for treatment such as surgery or other medical work.

Mental health treatments involve a wide array of services. It includes stays in rehab clinics for dependency issues, as well as visits to a psychiatrist, psychologist, or licensed therapist. Depression, post-traumatic stress disorder, and schizophrenia are among the many conditions covered.

The Connecticut unemployment insurance online service is expanding in 2007. After its introduction in 2006, approximately 30 percent of unemployment claims are processed online. This year, the Connecticut Department of Labor’s online filing system, also known as WebBenefits, is expected to expand. By the end of the year, many predict that more than half the unemployment claims will be processed online.  

“This time of the year we typically see an increase in the number of claims we handle,” said State Labor Commissioner Patricia H. Mayfield. “Weather-related construction shutdowns, after-holiday slowdowns in the retail industry and school vacations all contribute to that fact that more people find themselves filing for unemployment assistance until they are back at work again. In an effort to minimize wait times on our automated TeleBenefits “Dial to File” telephone claim system we suggest that people give our newest online service a try.”

The online WebBenefits system is available in both English and Spanish. The automated system can be used to file an initial unemployment claim, a continuing claim, or to check the status of a claim. “A few simple clicks of the computer mouse will let you know if your claim can be accomplished over the Internet,” Mayfield noted. “If not, users will receive a message on the computer screen to let them know they need to use the phone system to file.”

The automated WebBenefits program is part of a continuing effort by the Connecticut Dept. of Labor to get people back to work as soon as possible. Commissioner Mayfield explains that by incorporating technology into the claims process, benefit payments can be automated. This frees the department’s staff to focus on popular employment services such as job training, resume critiques and workshops.

A variety of employment services are offered at the state’s local CTWorks Centers. These include career counseling, résumé workshops, job search assistance, employment fairs, access to the online Connecticut Job Bank and specialized workforce assistance for veterans.