On January 1, 2009, New Jersey becomes the third state in the nation to implement a family leave insurance program. The New Jersey Paid Family Leave Act will permit employees to take paid time off to care for a sick family member. The act also provides benefits to workers who take time off to bond with newborn or newly-adopted children.
The New Jersey Family Leave Insurance program is funded by employee tax deductions. The program provides benefits to employees to partially replace income lost when they must take time from work. The law does not entitle employees to additional leave, over and above existing family leave laws such as FMLA, the federal Family and Medical Leave Act and the New Jersey Family Leave Act or NJFLA.
The New Jersey Paid Family Leave program does not guarantee that an employee will be returned to his or her job after leave; it simply provides cash benefits during the leave.
New Jersey employers still have time to comment on proposed changes to the FMLA regulations.
Click this link to add comments. Enter the keywords “Family and Medical Leave Act,” being sure to include the quotation marks. It is important to remember that any contact information an employer leaves will be visible to the public.
The comments may be made until April 11, 2008. After that date, the new regulations go into effect.
Several changes for employers are included in the new FMLA rules that were proposed by the U.S. Labor Department on February 11, 2008. These changes to the federal FMLA do not affect any state family leave laws.
One of the primary changes would essential broaden the scope of what is called “substitution of paid leave for FMLA.”
Under the law, employers are not required to pay employees who are taking FMLA leave. The employees may, on the other hand, take their sick leave concurrently with FMLA. For their part, employers may require them to do so.
The new rules would allow workers to use other types of accrued time off as well, including vacation time, personal leave, and paid time off (PTO), provided they meet their employers’ conditions. Employers, in turn, could require them to take the accrued paid time as FMLA leave.
Under the old rules, if Ron, as an example, has 2 weeks of accrued sick time, 5 weeks of paid vacation time, and 3 weeks of personal leave accumulated (a total of 10) he can only use the 2 weeks. Under the changes, he could use all 10 as FMLA leave. Because employees are entitled to as much as 12 weeks of FMLA leave annually, Ron would still have the right to take 2 more weeks of (unpaid) FMLA time.
Another proposed change allows employers to count FMLA leave as absent time when awarding “perfect attendance” certificates. The old rules do not allow employers to count FMLA leave as absent time. Employers and coworkers have both argued in the past that it is unfair for some workers to get attendance awards and possibly bonuses after using all 12 weeks of their FMLA leave.
More New Jersey FMLA Changes
The U.S. Labor Department is proposing some changes to the Family and Medical Leave Act, or FMLA, that would address the definition of “serious medical condition” and the process for medical certification of a condition.
These and other proposed changes will become law on April 11, 2008, at which time all employers must comply with them. Until that time, public comments will be accepted.
The Labor Department announced the proposed rule changes on February 11, 2008.
FMLA authorizes an employee to take as much as 12 weeks yearly of unpaid leave in the event of a “serious medical condition,” which could apply to the employee or to immediate family members.
Employers have the right to require that the condition be certified by a healthcare professional, in order to prevent abuse. Employers may also, under some conditions, require a second or third opinion, provided they pay.
The proposed new rules retain 6 definitions of “serious medical condition” but add some clarification on 2 terms. One definition of “serious medical condition” (it is only one of 6 of the definitions) requires that there by 3 consecutive days of incapacity and “two visits to a health care provider.” The term “two visits,” however, is left undefined in the current rules, and could mean anything, whether 2 per month or 2 per year. In the past a court has ruled that both visits must take place during the three-day incapacity period. But the proposed changes clarify the point to say that the 2 visits must happen within 30 days of the period of incapacity.
Other changes address the “Ragsdale” decision on employer penalties and make adjustments to the “fitness-for-duty” certification to return to work. The rules would determine that light duty no longer counts as FMLA leave and would allow employers to deny “Perfect Attendance” awards to workers who have taken FMLA. They would also allow for substitution of paid leave and affirm an employee’s right to settle FMLA cases out of court.
Victoria Lipnic of the U.S. Labor Department said the changes would “reflect court decisions” and “clear up ambiguities,” among other things.
Mental and physical health insurance coverage limits will remain equal until the end of 2007 thanks to an important law’s extension signed by the President. The more-than 150 million workers in the U.S. covered by group health insurance packages are affected.
The extension involves New Jersey employee benefit plans. The law is called the Mental Health Parity Act (MHPA). Before it was originally signed into existence in 1996, health insurance plans could legally have large discrepancies in their coverage limits for physical or mental health treatments. For example, physical health treatment coverage limits might be $100,000 yearly, but mental health limits could be one-tenth or even one-twentieth of that. Such discrepancies are no longer legal.
Before the MHPA a group health insurance plan might skimp on coverage for mental health treatments compared to medical/surgical coverage. For example, limits on medical treatment might be $100,000, while mental health plans might have considerably lower limits – $5,000 to $10,000, for example.
Thanks to MHPA, that approach is now illegal. Under MHPA, a health insurance plan must maintain equal levels for mental health treatment as for any other, such as surgery.
Mental health treatments that are typically covered include visits to a mental health professional – a licensed therapist, a psychiatrist, or a psychologist. Coverage is likely to include time in rehabilitation facilities for drug and alcohol issues. In addition, the plans may also include coverage for stays in either mental health psychiatric centers (mental hospitals) or the mental health section of a medical hospital.
The law has a major impact because in excess of 150 million workers in the U.S. are covered by group health insurance programs.
When the original MHPA was signed into law in 1996, a “sunset clause” was written in. That means the bill was designed to run out on September 1 of 2001. However, since then amendments to the law have extended the expiration date five times.
The US Dept. of Labor recently recovered almost $2 million in New Jersey employee benefits. The Dept. of Labor was granted a court judgment requiring the trustees of the New Jersey Licensed Beverage Association’s Multiple Employer Welfare Arrangement or MEWA, to fork over $1.65 million as restitution for mismanagement of the plan.
In addition, the MEWA trustees are barred from serving in any fiduciary capacity to any employee benefit plan, ever again. The funds will be used to pay health claims for workers. An additional $600,000 in restitution has already been paid under the plan.
The MEWA offered medical insurance for almost 4,000 employees of New Jersey bars and restaurants. The plan was dissolved in 2003, owing more than $6 million in unpaid benefits.
The US Dept. of Labor brought the suit under the Employee Retirement Income Security Act, ERISA.
Using strong words, US Secretary of Labor Elaine Chao said, “The mismanagement of this benefits plan was an inexcusable betrayal of the thousands of New Jersey workers who were left on the hook for health care bills.” Secretary Chao added, “I commend the court for ordering over $2 million in restitution and permanently barring these untrustworthy trustees from ever again being in a fiduciary capacity involving an employee benefit plan under ERISA.”
The Labor Department lawsuit alleges that the trustees failed to determine and maintain adequate funding levels to pay benefits from 1998 to 2003. In addition, they did not have adequate contribution rates to support benefit payments.
In an interesting twist to the case, Midlantic Healthcare, Inc., the insurance company, was also named in the suit. Apparently, the Midlantic Healthcare plan was essentially a self-insurance scheme. Essentially the suit claims that Midlantic did not keep the trustees informed of the financial condition of the plan. The suit also alleges that Midlantic failed to manage the plan in a financially responsible manner. This resulted in employees being promised benefits while the premiums were too low to cover the costs of those benefits.
The trustees also failed to monitor the actions of the plan administrator. An independent trustee has been appointed by the court to oversee the plan, and to use the plan assets to maximize payment of eligible claims.
By the middle of February, every who collected 2006 unemployment benefits in New Jersey should have received a 1099 form. The statements were sent out in late January. The New Jersey Department of Labor should be contacted if that form is not in hand. The 1099 details the income and deductions from unemployment benefits. Thousands of people in the state collected unemployment in 2006, totaling over $156 million in benefit payments.
If you or someone you know has ever been laid off, you know what a toll it can take on a person. Losing your job is nowhere near an easy experience. The government has provided us with a program that can deliver income during this time of crisis. That is called unemployment insurance.
Filing for unemployment can be done in person and sometimes online. Details about the company, length of time with the company and reason for separation will be asked. It can be a lengthy process depending on the situation. One of the requirements to receive the benefit is to be in active pursuit of work. This is so that the people who truly want to work but are having a hard time can be helped.
The New Jersey Dept. of Labor wants benefits obtainers to be reminded that unemployment is taxable. If the deductions were not taken from unemployment checks automatically, it is the recipient’s responsibility to pay the necessary taxes on the money. To file the unemployment income along with regular income taxes, the 1099 is provided. It is easy to forget about the taxes on this benefit. This is especially true of those who may have only gotten payments for two weeks.