labor lawAdivision of labor law center

On February 11, 2008 the U.S. Department of Labor announced a series of proposed changes to the FMLA regulations that affect Minnesota employers, as well as those across the nation.

The regulations will go into effect after April 11, 2008. Until then, employers will be able to comment. To do so, click this link and put in the keywords “Family and Medical Leave Act.” Include the quotes. The public will be able to view all contact information.

One important new change announced by the U.S. Department of Labor involves what is called substitution of paid leave for FMLA. Among other things, the changes allow an employer to require workers to use all of their accrued paid time off, including sick time, personal leave, and vacation time, as part of their unpaid FMLA.

By law, FMLA is unpaid leave. The existing statute permits employees to take any of their accrued paid sick time concurrently with their FMLA. It also lets employers require that employees take the sick time concurrently. The process is called “substitution of paid leave.”

Under the proposed changes, employees would be allowed to use accrued vacation time, paid time off (PTO), and personal leave as part of FMLA on top of sick time. The employee, however, must qualify according to the employer’s standards for taking paid leave.

If an employee, Ron, for example, has accumulated 2 weeks of sick time, 3 weeks of personal leave, and 5 weeks of vacation, that amounts to 10 weeks of paid leave. Under the new rules, Ron may take another 2 weeks of unpaid FMLA leave, because FMLA allows for 12 weeks per year. Ron has substituted paid leave for part of his FMLA.

Another, seemingly less significant, proposed change refers to “perfect attendance” awards. No longer will employees who use FMLA qualify for those awards. An employer will be allowed to consider FMLA leave as an absence. In the existing rules, FMLA leave could not be counted toward work absences. Both employers and coworkers argued that it was unfair if employees received the “perfect attendance awards” and bonuses even when they took their 12 weeks of FMLA time off.

More Minnesota FMLA Changes

A series of proposed changes to the Family and Medical Leave Act (FMLA) regulations deal with, among other things, the idea of an employee’s “serious health condition.” They also address the question of medical certification of the condition.

The FMLA includes a provision allowing an employee to take up to 12 weeks of job protected, unpaid leave annually if the worker or a member of the immediate family has a “serious medical condition.”

The U.S. Labor Department allows employers to require that the seriousness of the condition be supported by the certification of a healthcare provider. Employers may require opinions by a second or third physician, provided they, the employers, pay for the second and third opinion.

Under the new rules, 6 definitions of “serious medical condition” have been retained while guidance on 2 terms has been added. One definition says a “serious medical condition” involves more than 3 consecutive days of incapacity and two visits to a healthcare provider.” However, “two visits to a health care provider” is not defined in the current rules, and could mean 2 visits in 2 years. The Tenth Circuit Court, meanwhile, has said the visits must happen within the three-day period of incapacity. The Department of Labor is proposing that the rule be clarified to say the 2 visits must happen within 30 days of the period of incapacity.

The proposed changes were announced February 11, 2008. A public comment period will continue until April 11, 2008, when the regulations take effect.

Other proposed changes include a decision that “light duty” does not count as FMLA leave, as well as rulings on the “Ragsdale” decision and an employee’s right to settle FMLA cases out of court. The changes would permit substitution of paid leave under some condition and give employers the right to deny “Perfect Attendance Awards” to employees who have taken FMLA leave. The proposals would make changes to the “fitness-for-duty” certification to return to work.

Victoria Lipnic of the Labor Department said it is time to update the regulations to reflect court decisions and clear up ambiguities, among other things.

A $3 million grant will aid Minnesota workers affected by floods in the area. The U.S. Department of Labor announced the initial release of $1 million to create some 300 temporary jobs to aid in cleanup and recovery efforts following the summer’s flash floods.

“This $3 million grant will create nearly 300 temporary jobs for Minnesotans to help in the cleanup and reconstruction of their communities due to the recent flash flooding,” said U.S. Secretary of Labor Elaine L. Chao. “In addition, these funds may also be for job training for workers who have lost jobs due to the flash floods and need new job opportunities.”

Heavy rains began in the area on August 19 and 20. As the waters rushed downstream in the Mississippi and Minnesota rivers, a number of areas were affected.  On August 23, the Federal Emergency Management Agency (FEMA) declared that Fillmore, Houston and Winona Counties in Minnesota were eligible for FEMA’s Public Assistance program. That’s because heavy rains caused flash floods in those areas. On August 24, FEMA amended the declaration, and added three additional Minnesota counties: Olmstead, Steele and Wabasha. All of the counties mentioned are in the southeast corner of the state, near the Wisconsin border.

The grant is awarded to the Minnesota Department of Employment and Economic Development. It will be used to create temporary jobs to assist in projects related to cleanup. These jobs include demolition, repair, and renovation. Reconstruction of structures and areas affected by flooding will also be included.

Workers eligible to apply for the temporary jobs include those dislocated as a result of the floods, other dislocated workers, and the long-term unemployed in the areas afflicted.

Following the completion of temporary employment projects, funds may also be used to provide retraining services to workers who are unable to return to work as a result of the damage caused by the flooding.

This is a Disaster Relief grant under the National Emergency Grants program.

According to the U.S. Department of Labor, National Emergency Grants (NEGs) are discretionary awards by the Secretary of Labor. The grants temporarily expand service capacity at the state and local levels through time-limited funding assistance in response to “significant dislocation events.” When a layoff, plant closing or other event creates a need beyond what the state can reasonably be expected to meet, the state may apply for an Emergency Grant.  In order for a state to qualify, any discretionary funds available at the state level must be included in the state’s resources.

National Emergency Grants are awarded by the U.S. Secretary of Labor for different purposes. Disaster grants benefit areas afflicted by floods, wildfires, blizzards, hurricanes, earthquakes and other natural disasters. Other grants include Trade-WIA Dual Enrollment grants and Trade-Health Coverage Infrastructure grants.

Regular NEG grants may be available when a single or multiple company layoff affects 50 or more workers. NEG grants are also appropriate when layoffs are industry-wide within a region, or when small or rural communities are severely affected by layoffs of fewer than 50 people.

Trade-WIA Dual Enrollment grants are available for single or multiple-company projects that include layoffs of 50 workers or more. These grants are given only in areas where the U.S. Department of Labor determines that workers are affected by federal trade policies.

Trade-Health Coverage Infrastructure grants provide states with funds to help workers eligible for TAA (Trade Adjustment Assistance) or TRA (Trade Realignment Assistance) keep their healthcare insurance.

A number of resources are available to inform the state and local employment agencies of the policies that govern grant awards. Communities are urged to initiate the grant process early, to ensure that funds are available when needed.

Thanks to a ruling on group health insurance, Minnesota employee benefit plans will continue to include limits on coverage for mental health that equal those for medical and surgical procedures.

The ruling applies to what is known as the Mental Health Parity Act, or MHPA. As its name suggests, it declares that any employee group health plan in the nation must cover mental health treatment at levels equal to other kinds of medical treatment.

Minnesota employee benefit plans will be affected by the extension. Thanks to the Mental Health Parity Act, or MHPA, it is illegal for group health insurance plans covering workers to put ceilings on coverage for mental health treatments at levels lower than those for medical and surgical treatments.

Mental health treatments covered are stays in psychiatric centers (mental hospitals) or the mental health sections of medical hospitals for treatments of illnesses including post-traumatic stress disorder, depression, or schizophrenia. It also includes visits to mental health professionals such as psychologists, licensed therapists, or psychiatrists. Stays in “rehab” for drug and alcohol abuse are covered.

When the law was first passed in 1996, a “sunset clause” was written in, requiring that it expire on September 31, 2001. Five amendments since that time have extended the date of expiration.

Before the enactment of MHPA, limits on mental health plan coverage might much lower than corresponding limits on surgical or medical treatment coverage. Any such disparity is illegal under MHPA. In short, group health plans must pay for mental health coverage to the same degree they cover medical care.

Because 150 million U.S. employees are covered by group health plans, the MHPA – and its recent extension – have a broad impact on the workforce.

The Employee Benefit Security Administration (EBSA) is the enforcing federal agency. It was originally created in 1974 to oversee enforcement of the Employee retirement Income Security Act (ERISA) of 1974. Since then it has gained sub-cabinet level status and its mandate includes health care as well as pension oversight. The upgrade came in 2003. It is now under the auspices of an Assistant secretary of Labor.

Minnesota officials make it pretty plain: All companies or organizations that have workers doing services for them in Minnesota will have to held to the Minnesota Unemployment Insurance Law. No ifs, ands, or buts (at least not many of them).

That means if you have employees of any shape, size, or form in your offices, warehouses, or work sites in Minnesota, you ought to be registered with the Unemployment Insurance Employer Account system. The system runs through the Minnesota Department of Revenue, which withholds tax from employers, and through the Minnesota Secretary of State.

To register with this system, new employers in the state have to sign up with the Unemployment Insurance Employer Accounts Office. You have 10 days to do so from the first time that you pay wages to a worker in your company. However, new employers should not register before they pay these wages. In other words, the state of Minnesota’s Unemployment Insurance Employer Accounts Office is pretty strict with its 10 day window for your registration.

All of this registration for new employers can be done online at the Web site of the Unemployment Insurance Employer Accounts Office. Or you can register the old fashioned way, through the telephone. But again, the Unemployment Insurance Employer Accounts Office can be pretty strict here too—it requests that you only use the phone registration system if you do not have any access to the Internet.

Once you register, though, your job as a new employer in the state of Minnesota is over, right? Wrong. As with most states out there, Minnesota expects and hopes for certain things out of its employers when it comes to maintaining the unemployment insurance system. One of those things is complete record collection. That means keeping up to date and accurate personnel records, filing all exit interview forms, employee separation forms, and all other documents that keep track of your employees’ comings and goings.

Each employer’s account will pay a specific weekly and maximum amount of benefits. How are those amounts determined? What types of income affect the actual payments? Have employees heard about the “waiting week”? Do employees know that there may be child support or overpayment deductions? How can arrangements for income tax withholding or direct deposit be made? Answers can be found by consulting Minnesota Unemployment Insurance posters.

Whenever employees work for an employer (full time, part time or temporary) or in self-employment, employees must report those gross earnings when they request unemployment insurance benefits. Earnings include wages, tips, salary, commission, payment in cash, rent credit, goods, services or work to repay a debt. Claimants must report such earnings in the week employees performed the work, whether or not the employees have been paid. Minnesota Unemployment Insurance posters explain how these earnings affect the benefit amount. As an employee, it is wise to keep your own records of all gross earnings in case a discrepancy arises.

If the claimant’s total gross earnings are equal to or greater than the claimant’s weekly benefit amount for any week you request benefits, no unemployment benefits are paid for that week. If the claimant’s total gross earnings are less than the claimant’s weekly benefit amount for any week benefits are requested, and the claimant’s earnings are $200 or less, those earnings in excess of $50 are deducted from the claimant’s weekly benefit amount. If the claimant’s total gross earnings are less than the claimant’s weekly benefit amount for any week they request benefits, and the claimant’s earnings are more than $200, those earnings in excess of 25 % are deducted from the claimant’s weekly benefit amount. Claimants are not eligible for unemployment benefits if they work for an employer or in self-employment 32 hours or more in a week even if gross weekly earnings are less than their weekly benefit amount.

Minnesota Unemployment Insurance posters provide additional information when claimants are self-employed. Some business expenses during a week which are directly related and unique to the self-employment must be subtracted from your gross income. For example, income from farming would have direct costs such as seed, fertilizer, herbicides, and gasoline subtracted. Those expenses subtracted for income tax purposes are not necessarily subtracted for unemployment insurance program purposes.