DOL's New Proposed FMLA Regulations: They Help Employers, But Is It Enough?

While DOL's revisions provide some assistance to employers combating FMLA abuse, many argue that the revisions are not enough, and fail to address fundamental problems with the FMLA's intermittent-leave provisions in particular. The proposed changes are not final, but DOL has announced its intent to finalize them before the end of the year, and law firm managers should be aware of what changes are on the horizon. This article summarizes some of the more salient proposed changes.

Definition of Serious Health Condition

Under the current regulations, it is unclear what constitutes a qualifying 'serious health condition.' Employers have struggled with employee abuse of the regulations ' certain employees looking for a means to control their schedule or 'game the system,' so-to-speak, have found it easy to obtain a doctor's certification stating that they have a 'serious health condition,' qualifying them to take intermittent FMLA leave at any time.

Employers also have been troubled that more minor problems, such as colds, earaches, the flu, routine dental procedures, and the like, while ordinarily not considered a 'serious health condition,' can qualify.

To qualify as having a 'serious health condition' under the current regulations, employees must receive 'continuing treatment,' defined as a period of incapacity of more than three consecutive calendar days, along with treatment two or more times by a health care provider. The proposed regulations tighten the definition somewhat by adding a time limitation (the current regulations are open-ended), and requiring that an employee's two visits occur within 30 calendar days of incapacity. Additionally, the proposed regulations clarify that employees with a chronic condition (currently defined as requiring 'periodic visits' to a medical provider), such as diabetes, must demonstrate that they visit a doctor at least twice each year for their condition.

Although these changes work to clarify the meaning of 'serious health condition' and to curb employee abuse, concern remains about the possibility that more minor ailments (colds, earaches, and the flu) may still qualify as a 'serious health condition,' and that the new regulations still allow employees to abuse the system.

Medical Certification

Under the current regulations, employees are required to provide medical certification, verifying a serious health condition, if employers request it. The medical certification process has been a source of tension because it has been difficult for employers to confirm the details of an employee's medical certification. Under the proposed regulations, an employee's certification must state specifically 'what functions of the employee's position the employee is unable to perform.'

Further, the proposed regulations empower an employer to contact the employee's health care provider directly for purposes of clarifying a vague medical certification or to authenticate a certification. If an employer requests clarification from an employee directly, under the proposed regulations, the employee must provide clarification within seven calendar days, unless not practicable despite an employee's 'diligent good-faith efforts.'

Employers must still comply with the Health Insurance Portability and Accountability Act ('HIPAA') ' while the employer may authenticate a certification without employee consent, the employer may not inquire about the substance of the certification without consent. However, the proposed regulations allow for an employee's disqualification from FMLA leave if the employee withholds consent.

Employer Notice Requirements

Not all of the proposed changes ease employers' administrative burdens. Employers are required under the current regulations to post a notice of general FMLA rights and responsibilities. The new regulations add a requirement that employers distribute such notice to each employee on an annual basis. The proposed regulations require covered law firms to provide more specific written notice in connection with FMLA leave requests, including notifying employees regarding the number of hours, days or weeks that the employer will designate as FMLA leave. Employers are also required to notify employees if their leave does not qualify as valid FMLA leave.

Bonuses

Particularly relevant to law firms, the proposed regulations allow employers to deny bonuses 'based on the achievement of a specified goal, such as hours worked,' if the employee has not met the required goal, regardless of the FMLA's general reinstatement requirements. Of course, law firm managers may, at their discretion, choose to pay bonuses (on a prorated basis or otherwise) to an associate who has taken FMLA leave (but not met their hours), in order to reward quality work. But law firms would not be required to grant full bonuses to associates abusing the FMLA's intermittent leave provisions, for instance.

Releases

The proposed regulations would expand a law firm's ability to settle claims and obtain releases from its employees ' the new regulations allow employees to waive, release, and settle past (but not prospective) FMLA claims 'without the approval of the Department of Labor or a court,' a provision that negates the Fourth Circuit's decision in Taylor v. Progress Energy, 493 F.3d 454 (4th Cir. 2007), which held that such releases cannot include FMLA claims.

Conclusion

The DOL's proposed changes to the FMLA's implementing regulations have been viewed as favorable to employers, but many are complaining that the changes do not go far enough. The regulations are not final, however, and employers still have time to provide comment through April 11, 2008. It is important for law firm managers to stay abreast of the potential changes to FMLA administration. The summary provided in this article is not an exhaustive list of proposed changes ' to view DOL's full Notice of Proposed Rulemaking, visit http://www.dol.gov/esa/whd/fmla/FedRegNPRM.pdf.

Marisa Hudson-Arney and Danielle Kitson are associates in Gibson, Dunn & Crutcher LLP's Denver office.

Since the Department of Labor's ('DOL') regulations implementing the Family and Medical Leave Act of 1993 ('FMLA') were first issued in 1995, they have caused a degree of consternation for employers navigating some of their more confusing aspects, and grappling with employee abuse, particularly with respect to the regulations' intermittent-leave provisions.

In an effort to add clarity, the DOL published new proposed changes to the regulations on Feb. 11, 2008, on the heels of its December 2006 Request for Information, under which it received numerous comments from employers seeking relief. The proposed regulations clarify some uncertainties, but many remain.

The FMLA applies to 'covered employers,' defined as those with 50 or more employees working within a 75-mile radius. The definition brings within its ambit most medium- to large-sized law firms, including firms with multiple smaller offices in the same metropolitan area. The FMLA requires covered employers to provide up to 12 weeks of unpaid leave in a 12-month period to eligible employees in connection with certain qualifying events, such as the birth of an employee's child, or placement of a child for adoption or foster care with the employee, or the employee's inability to work because of a serious health condition, or the serious health condition of the employee's spouse, parent, or child. Employees may take FMLA leave intermittently or on a reduced leave schedule under certain conditions, and employers must reinstate employees to the same or equivalent position, and must maintain the employee's group health coverage during the leave period.

While DOL's revisions provide some assistance to employers combating FMLA abuse, many argue that the revisions are not enough, and fail to address fundamental problems with the FMLA's intermittent-leave provisions in particular. The proposed changes are not final, but DOL has announced its intent to finalize them before the end of the year, and law firm managers should be aware of what changes are on the horizon. This article summarizes some of the more salient proposed changes.

Definition of Serious Health Condition

Under the current regulations, it is unclear what constitutes a qualifying 'serious health condition.' Employers have struggled with employee abuse of the regulations ' certain employees looking for a means to control their schedule or 'game the system,' so-to-speak, have found it easy to obtain a doctor's certification stating that they have a 'serious health condition,' qualifying them to take intermittent FMLA leave at any time.

Employers also have been troubled that more minor problems, such as colds, earaches, the flu, routine dental procedures, and the like, while ordinarily not considered a 'serious health condition,' can qualify.

To qualify as having a 'serious health condition' under the current regulations, employees must receive 'continuing treatment,' defined as a period of incapacity of more than three consecutive calendar days, along with treatment two or more times by a health care provider. The proposed regulations tighten the definition somewhat by adding a time limitation (the current regulations are open-ended), and requiring that an employee's two visits occur within 30 calendar days of incapacity. Additionally, the proposed regulations clarify that employees with a chronic condition (currently defined as requiring 'periodic visits' to a medical provider), such as diabetes, must demonstrate that they visit a doctor at least twice each year for their condition.

Although these changes work to clarify the meaning of 'serious health condition' and to curb employee abuse, concern remains about the possibility that more minor ailments (colds, earaches, and the flu) may still qualify as a 'serious health condition,' and that the new regulations still allow employees to abuse the system.

Medical Certification

Under the current regulations, employees are required to provide medical certification, verifying a serious health condition, if employers request it. The medical certification process has been a source of tension because it has been difficult for employers to confirm the details of an employee's medical certification. Under the proposed regulations, an employee's certification must state specifically 'what functions of the employee's position the employee is unable to perform.'

Further, the proposed regulations empower an employer to contact the employee's health care provider directly for purposes of clarifying a vague medical certification or to authenticate a certification. If an employer requests clarification from an employee directly, under the proposed regulations, the employee must provide clarification within seven calendar days, unless not practicable despite an employee's 'diligent good-faith efforts.'

Employers must still comply with the Health Insurance Portability and Accountability Act ('HIPAA') ' while the employer may authenticate a certification without employee consent, the employer may not inquire about the substance of the certification without consent. However, the proposed regulations allow for an employee's disqualification from FMLA leave if the employee withholds consent.

Employer Notice Requirements

Not all of the proposed changes ease employers' administrative burdens. Employers are required under the current regulations to post a notice of general FMLA rights and responsibilities. The new regulations add a requirement that employers distribute such notice to each employee on an annual basis. The proposed regulations require covered law firms to provide more specific written notice in connection with FMLA leave requests, including notifying employees regarding the number of hours, days or weeks that the employer will designate as FMLA leave. Employers are also required to notify employees if their leave does not qualify as valid FMLA leave.

Bonuses

Particularly relevant to law firms, the proposed regulations allow employers to deny bonuses 'based on the achievement of a specified goal, such as hours worked,' if the employee has not met the required goal, regardless of the FMLA's general reinstatement requirements. Of course, law firm managers may, at their discretion, choose to pay bonuses (on a prorated basis or otherwise) to an associate who has taken FMLA leave (but not met their hours), in order to reward quality work. But law firms would not be required to grant full bonuses to associates abusing the FMLA's intermittent leave provisions, for instance.

Releases

The proposed regulations would expand a law firm's ability to settle claims and obtain releases from its employees ' the new regulations allow employees to waive, release, and settle past (but not prospective) FMLA claims 'without the approval of the Department of Labor or a court,' a provision that negates the Fourth Circuit's decision in Taylor v. Progress Energy, 493 F.3d 454 (4th Cir. 2007), which held that such releases cannot include FMLA claims.

Conclusion

The DOL's proposed changes to the FMLA's implementing regulations have been viewed as favorable to employers, but many are complaining that the changes do not go far enough. The regulations are not final, however, and employers still have time to provide comment through April 11, 2008. It is important for law firm managers to stay abreast of the potential changes to FMLA administration. The summary provided in this article is not an exhaustive list of proposed changes ' to view DOL's full Notice of Proposed Rulemaking, visit http://www.dol.gov/esa/whd/fmla/FedRegNPRM.pdf.

Marisa Hudson-Arney and Danielle Kitson are associates in Gibson, Dunn & Crutcher LLP's Denver office.