Diversified Group Named One of CT’s Healthiest Employers by Making Wellness Part of Company Culture

This article was published on September 16, 2019 on Hartford Business written by Wendy Pierman Mitzel. Photo source is Hartford Business Journal.

1st Place | Category: 1,000 or fewer employees

Diversified Group

Headquarters: Marlborough

Industry: Health insurance and benefits administration

Top Executive: Brooks T. Goodison, President

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Diversified Group not only offers its customers a worksite wellness plan, it offers programs to its own employees as well.

Company leaders say creating a healthy workplace translates to happier employees, high retention rates and increased customer service.

According to Alison Searles, Diversified Group’s client service specialist, continuity and accessibility are key to defining the culture of wellness within the health insurance firm. Workers can take exercise classes during lunch breaks and organize their schedules in a way that allows them to attend monthly programs like meditation, wellness coaching and fitness challenges.

“Employees want to be healthy and just a little push from Diversified Group has helped some individuals make huge strides when it comes to health,” she explained. “When employees come back from their spin class, yoga or meditation session, they feel a little more clear-headed, a little more energized and ready to tackle the rest of their day as opposed to hitting that 2 p.m. crash.”

Employees can choose from activities led by educated and trained professionals and held on a regular basis. They include weekly fitness classes such as yoga, spinning and strength; monthly meditation sessions; monthly wellness-focused activities; quarterly wellness challenges; and on-demand health coaching or dietetic counseling.

Diversified Group provides programs regularly so employees make wellness part of their everyday routine, said Searles.

“The goal of our program is to instill the concept that wellness is a lifelong priority,” she added.

Targeting the needs and wants of some 55 employees is another important part of offering the right programs to gain participation. Recently, Diversified Group began instruction in yoga nidra, also referred to as sleep yoga, on the suggestion of the holistic health specialist.

Diversified Group also has a robust incentive campaign that offers small rewards for meeting certain benchmarks and larger ones for commitments spanning the entire year.

“Rewards initially motivate employees to participate in our wellness challenges and activities, but many have recognized that they truly feel better when they participate and this encourages them to keep going,” Searles said. “We have quite a few people who now lead healthy lifestyles simply because they learned how great being healthy feels.”

The program is communicated to employees through a new wellness portal. In addition, a yearly aggregate evaluation, along with satisfaction surveys and one-on-one meetings, allow for adjustments and improvements.

Click here to view the full list of HBJ’s 2019 Healthiest Employers awards.

MA Paid Family Medical Leave Payroll Deductions to Begin October 1st

MA PFML is a statewide program that gives eligible employees paid time off for family and medical leave beginning January 1, 2021. PFML will provide employees up to 12 weeks of paid family leave and 20 weeks of paid medical leave or up to 26 weeks of leave to care for a family member who is a service member. All Massachusetts employers with one or more employees are subject to the PFML law. Employers must submit contributions on behalf of employees. After a three-month delay in implementation, employer deductions under PFML will begin October 1, 2019 which will represent the first quarter of payroll withholdings. These withholdings, and in some cases employer payments, will be remitted to the Department of Family and Medical Leave (DFML) via MassTaxConnect 30 days following the conclusion of each calendar quarter and will begin with the first payment made on or after Oct. 1, 2019. Contribution percentages depend on your average number of covered individuals from the last calendar year. Employers with fewer than 25 employees do not have to contribute to the employer portion of PFML. Employers with 25 or more employees must pay an employer contribution amount. 1099-MISC contractors may be considered covered individuals. See the link below for help in determining who is a covered individual for PFML purposes.

The DFML has released the revised allocation of PFML contribution rates beginning October 1, 2019. Employers must begin withholding and paying Massachusetts family and medical leave contributions at an initial rate of 0.75% (up from 0.63%) of each employee’s wages up to the 2019 Social Security wage base of $132,900. Based on the new rate of 0.75%, 0.62% funds medical leave and 0.13% funds family leave. Employers with 25 or more employees may withhold up to 40% of the medical leave portion of the contribution from employees’ wages. Employers with 25 or more employees are required to fund the remaining 60% of the medical leave contribution, however they are not required to contribute to the family leave portion, although they may choice to do so. See the link below to access the DFML’s calculator tool for help in determining your contribution amount.

Important Dates:
September 30, 2019 — Employers and covered business entities are required to post a notice and provide written notice to their current workforce. A sample poster and tips on crafting your written notice can be found here.

October 1, 2019 — Payroll withholdings begin. MA PFML has created a tool to help you estimate the number of your covered individuals. The tool can be accessed here. Help in determining your contribution can be found here.

December 20, 2019 — Deadline to file for a private plan exemption for first quarter contributions.

January 31, 2020 — First quarterly contribution payment due through MassTaxConnect.

The DFML’s website has a lot of valuable information, tools and webinars that you may find helpful in answering most of your questions regarding PFML. A link to the Department’s website can be found here.

Which Welfare Plans Must File Form 5500?

Funded Plans:
All  “funded” welfare plans covered by ERISA must file a Form 5500. A “funded” plan is one where funds are set aside in a custodial account or trust fund for the exclusive benefit of plan participants. The type of Form 5500 (Form 5500 vs. Form 5500-SF) filed is determined by the number of plan participants in a funded welfare plan. In other words, all funded welfare plans must file a Form 5500, regardless of the number of plan participants. Self-insured welfare plans that hold funds in a trust fund (such as, a “Voluntary Employees’ Beneficiary Association”) or hold employee contributions in a separately maintained fund, makes them funded and subject to annual Form 5500 filings.

UnFunded Plans:
Most welfare plans covered under ERISA, however, are not funded. The greater majority of welfare plans are either fully-insured or partially insured through a stop-loss insurance policy. The Department of Labor (DOL) has an exception for unfunded and insured welfare plans. If a welfare plan covers fewer than 100 participants at the beginning of a plan year and is unfunded and/or insured, then the plan sponsor is not required to file a Form 5500. Also, a plan sponsor does not need to file a Form 5500 for a self-insured welfare plan if the plan has less than 100 participants at the beginning of the plan year and is not funded.

Filing the 5500 for a Self-Funded Plan:
If a plan sponsor of a self-insured welfare plan simply funds the plan out of their general assets and covers less than 100 participants, then no Form 5500 filing is required. When a welfare plan does cover 100 or more participants at the beginning of the plan year, the plan sponsor must file a Form 5500 regardless of how the plan is funded or what insurance arrangement is in place. 

5500 Schedules:
Schedule A – Insurance Information (Required for a fully-insured welfare benefit plan or a self-funded plan that is under a Trust Arrangement.)

• Schedule A must be completed if any benefits under an employee benefit plan are provided by an insurance company, insurance servicer, or other similar organization. This includes investment contracts with insurance companies.
• Insurance premiums, broker commissions and year-end enrollment information are reported on Schedule A.
• Self-insured plans are required to attach Schedule A for stop-loss coverage ONLY IF the plan itself is the named policyholder of the stop-loss policy. Typically, a plan is the policyholder of a stop-loss policy only when it is funded through a trust.

Schedule C – Service Provider Information (Required only for a FUNDED welfare benefit plan i.e., has a trust that pays service providers)

• Schedule C must be completed if a service provider was paid $5,000 or more in compensation, directly or indirectly from the plan, or an accountant or enrolled actuary was terminated during the reporting year.
• Schedule C is NOT required for payments made by the EMPLOYER for plan-related expenses. Schedule C is required only when payments are made from the PLAN. Because the employer makes all payments to service providers for an unfunded plan, a Schedule C is typically required only for funded plans. If the provider allocated services to the Plan Sponsor who in turn funded via general assets and a trust IS NOT in place, then the Schedule C is not applicable to be reported in the Form 5500 report.

What if you filed a Schedule you didn’t need to file?
There is no penalty for oversharing information with the IRS regarding your plan. The bigger question is why you would if you don’t have to?

Wrap Up:

• All “funded” welfare plans must file a Form 5500;
• All unfunded (self-insured) and/or insured welfare plans must file a Form 5500 IF the plan covers 100 or more plan participants as of the beginning of the plan year.

Plan sponsors need to understand when to file a Form 5500 for a welfare plan. The penalties ($1,100 per day) for not filing are severe and worth noting. The DOL has also learned how to find out if a plan sponsor is not filing a Form 5500 for a welfare plan. If your organization sponsors any kind of retirement plan, the DOL may send you a letter asking for your welfare plan filing. If your organization may be in this situation, take the time now to review your welfare plan filing obligation.

Funded Plan	All funded plans (funds set aside in a trust or custodial account for the exclusive benefit of the plan’s participants) must file Form 5500 regardless of size.
Unfunded Plan	Insured plans or self-funded plans that are unfunded (benefits paid as needed directly from the general assets of the employer or employee organization that sponsors the plan). Unfunded plans that have 100 or more participants at the beginning of the plan year must file Form 5500.  Unfunded plans with less than 100 participants at the beginning of the plan year are not required to file.
Schedule A	Schedule C
For Fully-Insured (premium-based) insurance policies. Schedule A for stop-loss policy is to be included if the plan is funded via a trust ERISA Plan.	Only to report fees of $5,000 or more paid out of trust fund assets to entities for services provided to the Plan.
Includes the total premiums within policy period plus participants (covered persons).	Includes the fees paid out of the trust’s plan assets to service providers for legal, marketing, etc.
Commissions, bonus or other sources of revenue from the Carrier to Broker are to be noted.	Broker’s commissions are not reportable on a Schedule C. However if the broker’s fees were paid out of trust fund assets, then those would be reported on the Schedule C.

Connecticut Paid Family and Medical Leave Law

On June 25, 2019, Governor Ned Lamont signed into law Connecticut’s Paid Family and Medical Leave law. Below are some highlights from the new law:

Connecticut Paid Family and Medical Leave Law
Key Dates	June 25, 2019 – CT Governor signs legislation into law; January 1, 2021 – Employee payroll tax begins; January 1, 2022 – Benefits become available and final regulations are due; July 1, 2022 – Annual notice of benefits to all new employees required.
Governing Body	New state agency, the Paid Family Leave Insurance Authority.
Covered Employers	Employers with at least one employee working in the state. The law exempts municipalities, local or regional boards of education, and nonpublic elementary and secondary schools. Municipal union employees can bargain to be covered under the state program. If the union bargains and is granted inclusion, non-union employees for that municipality will automatically be included.
Eligible Employees	An employee who has earned at least $2,325 in a base period (ex:  first four of the five most recently completed calendar quarters) and have been employed at least 3 months preceding the leave request. Available to full-time, part-time and former employees (if they apply within 12 weeks of losing their job).
Leaves Covered	Family leave to bond with a newborn or adopted child. Medical leave to care for a family member with a serious illness (family member’s include spouse, child, parent, parent-in-law, stepparent, others who are equivalent to a family member, grandchild, grandparent or sibling).  Medical leave is also available for the employee’s own serious illness. Paid leave is also available to serve as an organ or bone marrow donor. Intermittent leave will also be allowed except in the case of bonding with a newborn or adoption.
Length of Leave	Up to 12 weeks of paid family and medical leave during a 12 month period, with another two weeks available for a serious health condition related to pregnancy.
Benefit Amount	95% of base weekly earnings up to 60 times the minimum wage rate (maximum weekly amount will be approximately $780 per week in 2022 up to $900 per week in 2023).
Payroll Contribution	Beginning January 1, 2021, a new payroll tax up to .5 percent of the employee’s wages will be deducted to fund the program. Wages are capped at the Social Security wage base ($132,900 in 2019).
Concurrent Benefits	If an employee is receiving worker’s compensation, unemployment compensation and another other state or federal wage replacement, they will not be eligible for benefits under the CT Paid Family and Medical Leave.
Private Employer Plans	Connecticut employers can opt out of the state program if they have an employer sponsored private plan that provides the same or more generous benefit. Private plans must be approved by a majority of covered employees.

The above is a brief overview of the law as it stands today and is subject to change. Final regulations are due by January 1, 2022 which is the same date that benefits are first payable. The regulations should clarify issues surrounding implementation, coordination with CT’s unpaid FMLA leave and provide sample model notices. Diversified Group will keep you informed of any developments.

Expanding HRA Options Effective 2020

On June 13, 2019, The Departments of Health and Human Services, Labor, and Treasury issued the final rule expanding health reimbursement accounts (HRAs) which allows employers greater flexibility in the breadth and scope of HRAs available for their employees.

Background:

Since 2013, regulations have prohibited employers from paying for an employee’s individual health insurance policy and required that HRAs offered to employees be integrated with a group health plan. In 2016, Qualified Small Employer HRAs (QSEHRA) were developed to allow small employers (under 50 lives) to offer an HRA with IRS defined annual limits (in 2019 $5,150/individual and $10,450/family) to be used to pay for individual health premiums of minimum essential coverage when the employer does not offer a group health plan. In October of 2017, President Trump issued an Executive Order that in part directed the agencies to end rules that prohibited employers from paying for individual health insurance premiums through an HRA.

Two New HRA Options arising out of the Executive Order effective January 1, 2020 are:

1. Individual Coverage HRA
2. Excepted Benefit HRA

Individual Coverage HRA:

This HRA would allow employers to provide tax-free funding to an employee’s HRA account that could be used to purchase individual health insurance policies. This differs from the QSEHRA in that there is no requirement around the size of the employer.

• Employers cannot offer both a traditional group health plan and an Individual Coverage HRA to similarly situated employees. However, they can choose a group of employees to offer either the group health plan or the HRA based on a specific class:
  • • • Full-Time Employees*
      • Part-Time Employees*
      • Seasonal Employees
      • Employees covered by a collective bargaining agreement
      • Employees who have not satisfied a waiting period for coverage
      • Non-Resident aliens with no US-based income
      • Employees whose primary site of employment is in the same rating area*
      • Salaried Employees*
      • Non-Salaried Employees*
      • Temporary Employees of staffing firms
      • Combination of 2 or more of the above*
        *Minimum class size requirements will apply depending upon the classes defined (those with asterisk), whether some classes have a group health plan offered, and the size of the employer. (For example, the minimum class size is 10 for employers with 100 or less employees and 20 employees for an employer with 200 or more employees. The minimum class size for mid-sized employers (between 100 to 200) is 10 percent of the total number of employees.)

• The HRA must be offered on the same terms and conditions to all similarly situated employees. Dollar amounts, however, can vary based on age and number of dependents;
• Employees must have the ability to opt out of the HRA and waive future HRA reimbursements at least annually;
• HRA sponsors must be able to vary their HRA terms to account for different effective dates for individual coverage which can vary based on enrollment;
• If an employee stops being enrolled in an individual policy, they forfeit the HRA prospectively;
• Loss of the HRA for reasons other than failing to maintain individual coverage may qualify the HRA for COBRA;
• Individuals covered by the HRA must attest to being enrolled in an individual policy providing minimum essential coverage. Employers can rely on their employees attestation statement as accurate. No further verification is required;
• Individual coverage can be purchased on or off the exchange. It also includes student health coverage;
• Employers can specify reimbursements – premiums only, non-premium cost shares, or particular medical expenses per existing HRA rules. An Individual Coverage HRA that reimburses solely for premiums would not disqualify contributions to an HSA if the individual otherwise meets the requirements (enrollment in a HDHP);
• Under some circumstances, an Individual Coverage HRA may reimburse for Medicare premiums;
• Employers must provide a notice to participants which outlines the terms and conditions of the HRA at least 90 days before the start of the plan year;
• Individual Coverage HRAs are not considered ERISA plans;
• Individual Coverage HRAs are considered an offer of minimum essential coverage for 4980H(a) employer shared responsibility provision. If the Individual Coverage HRA is also deemed affordable, the offer would also satisfy the 4980H(b) employer shared responsibility provision;
• Employees being offered an affordable Individual Coverage HRA will not be eligible for a premium tax credit from the exchange (also must be stated clearly in the employee notice);
• Affordability means that health insurance for the employee should cost no more than 9.86% (indexed annually) of the employee’s household income, using the lowest cost silver plan for self only coverage on the local exchange and incorporating the employer’s contributions. Because this would be a logistical impossibility for most employers, the final notice includes 3 safe harbors to determine affordability:
  • • • Location: This safe harbor allows employers to use the lowest cost silver plan where the employer’s primary site of employment is located as the standard for affordability calculations;
      • Calendar Year: Employers who implement an individual coverage HRA for the following calendar year could use the existing year’s estimates as a baseline for affordability;
      •  Affordability: Since it is unlikely that employers know their employee’s household income, they can use the already established affordability safe harbors of W-2, rate of pay or federal poverty line.

Excepted Benefits HRA:

Currently, only HRAs classified as an excepted benefit HRA (reimburses only limited expenses, such as vision or dental) can be stand-alone/not integrated with the medical plan. The new Excepted Benefit HRA would allow a stand-alone HRA to also reimburse cost sharing expenses and still qualify as an excepted benefit if it meets certain requirements:

• The maximum benefit cannot exceed $1,800 for the plan year (indexed annually);
• Must be offered alongside a traditional group health plan although employees do not have to be enrolled in the traditional plan;
• The HRA must be available on the same terms for all similarly situated individuals regardless of health factor. Similarly situated means job classification, such as full-time, part-time, different geographic locations, union, non-union, and different occupations or even dates of hire or length of service ;
• Reimburses cost sharing expenses as well as premiums for excepted benefits (such as vision, dental, std), short-term medical plans, and COBRA premiums (individual or group premiums, Medicare premiums are not eligible);
• No employer size requirement;
• Can permit rollover of unused amounts;
• Subject to Section 105(h) nondiscrimination rules.

MA Paid Family and Medical Leave – Delay of Payroll Tax Deduction

The Massachusetts Paid Family and Medical Leave law (effective in 2021) requires employers to start making financial contributions to support the paid leave program starting on July 1, 2019. The law allows employers to deduct a part of the required contribution from each employee’s wages (along with an employer contribution*) to fund the program. The initial contributions are set at 0.63% of each employee’s wages.

On June 12^th, the Governor, Charlie Baker, announced a three-month delay to the start of the payroll tax which would have begun July 1^st. The delay is to help clarify the provisions of the program and to give employers adequate time to adjust and implement the program. The goal is to have the new tax in place by the fall. This delay comes in part due to the May 20^th request from Associated Industries of Massachusetts (AIM) and various labor groups requesting the delay, as well as fixes to the policy that better align the law with the federal Family and Medical Leave Act.

*Employers with fewer than 25 employees do not have to pay the employer share of the cost. 

Diversified Group will stay up-to-date on this issue and pass along any further developments.

2019 PCOR Fee Increase

For 2019, the annual fee to fund the federal Patient-Centered Outcomes Research Institute (PCORI), paid by employers that sponsor self-insured health plans and by commercial group health insurance providers, will go up by about .06 cents per employee or dependent enrolled in the health plan. The fees are due by July 31. The chart below shows the fees to be paid in 2019, which rose slightly from the fees owed in 2018.

Plan Year Ending in 2018	Fee per Plan Enrollee for July 31, 2019, Payment
Plan year ending on or after Oct. 1, 2018, through Dec. 31, 2018, including calendar-year plans.	$2.45
Plan year ending on or after Jan. 1, 2018, through Sept. 30, 2018	$2.39

For self-funded plans, the self-insured employer is responsible for submitting the fee and accompanying paperwork to the IRS. PCOR fees are reported on IRS Form 720, Quarterly Federal Excise Tax Return. On page two of Form 720, under Part II, the employer needs to designate the average number of covered lives under its applicable self-insured plan. Although the fee is paid annually, employers should indicate on the Payment Voucher (720-V)—located at the end of Form 720—that the tax period for the fee is the second quarter of the year. Failure to properly designate ‘2nd Quarter’ on the voucher will result in the IRS’s software generating a tardy filing notice.

Sponsors of self-insured health plans will pay their last PCOR fee by July 31, 2019 (for calendar-year plans) or by July 31, 2020 (for certain non-calendar year plans). The PCOR fee will no longer apply for policy and plan years ending on or after Oct. 1, 2019. The final filing for a calendar year plan will be July 31, 2019, with respect to the 2018 plan year.

Clients who have elected to have Diversified Group assist with the PCOR fee calculation can expect an email in June which will include a copy of the completed Form 720 and a PCOR calculation worksheet with supporting documentation. Clients will need to file the Form 720 by July 31, 2019.

Updated Draft Regulations for MA Paid Family and Medical Leave

The newly created Massachusetts Department of Family and Medical Leave released updated draft regulations on March 29^th for the new Paid Family and Medical Leave law. The Department will hold several listening sessions in May throughout the state before issuing final regulations sometime before July, 2019. Below is an outline of the draft regulations with pertinent information for employers concerning their obligations under the law.

Provision	Description
Key Dates	July 1, 2019, final regulations due and quarterly reporting instructions due;  July 1, 2019, employers must begin employee payroll deductions;  July 1, 2019, new hire notice distribution begins;  July 1, 2019, informational posters must be displayed on or before this date; October 31, 2019, contributions (employer and employee) for July through September due;  January 1, 2021, most leave available;  July 1, 2021, all leave available;  January 1, 2023, Retaliation against an employee for exercising rights under the PFML will be prohibited.
Governing Agency	The Department of Family and Medical Leave (DFML) within the Executive Office of Labor and Workforce Development.
Benefit Administrator	The Department of Family and Medical Leave (DFML) within the Executive Office of Labor and Workforce Development.  Except for employee notification, quarterly reporting, collecting and remitting contributions, employers are not involved in the benefit determination or payment of benefits.  However, note that the DFML may contact the employer for information on an employee that applies for benefits.  When this happens, employers will have 5 business days to respond to DFML.
Covered Employers	All employers (one or more employees) who are required to contribute to the Massachusetts Unemployment Insurance program (UI) must submit contributions on behalf of their employees to cover the portion of PFML contribution due from employees, as well as make their required employer contribution to the medical leave portion.  Employers with fewer than 25 employees must submit contributions on behalf of their employees, however they are not required to pay the employer portion of the contributions for medical leave. Cities and towns are exempt but can opt in to the program; employers not covered by UI can also opt in to the program.
Eligible Employees	All employees who meet the monetary eligibility requirements of the state’s UI program (i.e. the employee must have earned 30 times the weekly unemployment benefit that the employee would be eligible to receive and must have earned at least $4,700 during the last four calendar quarters). No minimum hour requirement. Additionally employees whose employer they contract with issues 1099-MISC to more than 50% of its workforce are covered employees.

Get Set to Run & Join Us in Supporting Camphill Village on May 18th

Diversified is proud to sponsor the Camphill Village 5K Trail & Fun Run coming up on Saturday, May 18^th! If you’d like to participate, there are three running options that allow people of all abilities to join from virtually anywhere!

• Sign up to run from home or anywhere; just be sure to take to Facebook and Instagram to share photos and your reason for participating leading up to and during the run. Use the hashtag #Camphill5K and your posts will be featured on their website and social media. If you send your address, they will also send you a gift from their event to show their thanks.
• Sponsor a runner or sign up to personally run the 5K Trail Run through the Camphill Village scenic woods and pathways.
• Sponsor a participant or sign up to leisurely walk, jog or stroll around Ring Road at the Village in the Fun Run. (Kids 12 & under run the Fun Run for free!)

With these options, it’s easy to support this wonderful cause. Through sponsorships, donations and registrations, this 5K and Fun Run will help to provide the programs and services that make Camphill Village the very special place it is for adults with special needs.

Diversified Group is proud to support this event that attracts virtual runners from all over the country and has raised more than $40,000 to benefit the lives of people who call Camphill Village their home.

To register, click below to visit the website and go to Runner Sign Up.

More About Camphill Village

Camphill Village in upstate New York is 615 acres of wooded hills, gardens and pastures. Adults with special needs and long- and short-term service volunteers live and work together as equals in extended family homes throughout the area. We are a non-profit organization dedicated to our mission of being an integrated community where people with developmental differences are living a life of dignity, equality and purpose. Through sponsorships, donations and registrations, this 5K and Fun Run will help to provide the programs and services that make Camphill Village the very special place it is for adults with special needs.

DOL’s Recent Clarification Surrounding FMLA

The Department of Labor (DOL) on occasion will issue opinion letters to clarify employer’s obligations under various federal employment laws. These DOL opinion letters help employers to understand their obligations and can be relied upon to establish a “good faith” defense against certain federal claims.

On March 14, 2019, the DOL issued an opinion letter regarding FMLA leave and its coordination with other employer leave provisions. The DOL clarified that if an employee’s leave taken for medical reasons is deemed FMLA qualified, the employer must then designate the leave as FMLA leave within five business days and may not delay such designation even to accommodate or benefit its employee. In other words, if an employee requests to take paid PTO leave and delay the designation of qualified FMLA leave until after the paid PTO is exhausted, per this opinion letter, once an eligible employee communicates a need to take leave for a qualified FMLA reason, neither the employer nor the employee may decline FMLA protection for that leave. Thus, when an employer deems that leave is for a qualified FMLA reason, the leave counts toward the employee’s FMLA leave entitlement.

The employer may instead allow the employee to “stack” the FMLA leave and paid leave by allowing the employee to take the FMLA leave unpaid and to use any available paid leave upon exhaustion of the FMLA entitlement. Alternatively, the employer may require employees to utilize available paid leave concurrently with FMLA leave, thus paid leave counts toward the FMLA leave entitlement, and vice versa.

Employers should review applicable state leave laws that may offer additional or different benefits that may cause the DOL opinion letter to contradict existing precedent. For example, this opinion letter contradicts the 2014 Ninth Circuit Court’s case Escriba v Foster Poultry Farms, Inc. which found that an employee could affirmatively decline to exercise their FMLA rights, even when they clearly would have qualified, in order to preserve the FMLA rights for future use. Those employers in the Ninth Circuit jurisdiction (Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington) may want to consult their legal counsel prior to relying on this opinion letter.

It is intended for Diversified Group’s medical plan document language to correspond with an employer’s human resource practices. Our documents typically include language that FMLA will run concurrently with other leaves in compliance with the DOL’s intent. To ensure that your medical plan document and your HR practices are coordinated, we offer a gap analysis which looks at gaps between your plan document and your employee handbook with an eye to ensuring compliance with your plan document and your stop loss carrier’s requirements. Gap analysis is done at no cost to you. If you are interested in having a gap analysis completed, please contact either Dave Follansbee or Laura Williams at the contact information below.

Dave Follansbee – dfollansbee@diversifiedgb.com / 860-295-6531
Laura Williams – lwilliams@diversifiedgb.com / 860-612-8644