How Brokers Can Help Employers Navigate Paid Leave Strategy

By Jennifer Hader

Since the enactment of the Families First Coronavirus Response Act, many employers have had specific questions regarding the paid leave provisions and how to integrate them into their existing paid leave strategy.

In a recent Guardian Life webinar poll, attendees were asked what their “top business priority is today” with 67% responding that “implementing safety measures for employees and customers” was a top priority.

As states reopen, understanding the paid leave laws currently in place and having a holistic paid leave strategy will be instrumental for many employers, particularly because the safety and health of a workforce is front and center in today’s “new” world.

Here are some key reminders about both programs under the new federal paid leave law:

• The FFCRA gives some relief to workers and their families by creating emergency paid sick leave and an expanded paid family leave.
• These temporary programs are only in effect until the end of this year.

Both programs provide protection for employees in two ways – income and job protection. The bill requires employers with up to 500 employees to provide and pay for these leaves. To cover the costs of the leave, the government will give employers a refundable payroll tax credit. Additionally, it is worth mentioning that the national conversation around paid leave and COVID-19 continues with additional provisions to expand leave included in the HEROES Act that passed the House.

The following are some key takeaways that brokers, benefits consultants and human resources administrators consider as they pertain to paid leave:

How Short-Term Disability Overlaps With The New Federal Programs

Many employers who offer short-term disability insurance have had to learn quickly how STD intersects with the current laws and when coverage kicks in. It’s important to note that the Expanded Paid Family Leave has only one qualifying reason for leave and that’s school or child care closure due to COVID-19. Regarding STD, it will not cover school closures or caring for someone else. In general, for someone to qualify for disability coverage, they need to be sick and unable to work due to that sickness.

So, what if someone is subject to a quarantine or isolation order? Typically, a quarantine order or isolation order alone would not qualify them for STD coverage – unless there is a special provision in the contract that covers those events.

If someone is experiencing symptoms, but not sick enough that they couldn’t do their job or they could do their job from home, this circumstance would also not qualify for short-term disability.

Additional State Programs To Consider

The new federal programs are not the only programs offering protection to employees. There are some states that have extended benefits due to COVID-19 under their statutory disability and paid family leave programs and their unemployment programs.  Some states and municipalities have even put in place paid sick leave programs of their own.  It’s important for employers to check out the websites for the states and municipalities in which their employees work to determine what programs might apply.

Return To Work – Is Your Paid Leave Strategy In Place?

Figuring out paid and sick leave has always been a challenge for employers, but even more so, with this pandemic. The reality is that more federal and state regulation means more employers need to focus on leave management compliance and how it impacts their workforce.

The question surrounding short-term disability and FFCRA is just one example that brokers and benefits consultants have had to tackle for their clients in the last several weeks. As we move to a return-to-work phase, many employers are now focusing on their workplace strategy for the remainder of the year, which is a reminder that paid leave should be a component of that strategy.

Take, for example, what our nation’s health experts continue to tell us – it’s possible the pandemic may not necessarily go away, but rather either have ebbs and flows this year or peak in the fall.  If this is the case, this increases the likelihood that coronavirus will continue to be an additional factor impacting paid leave claims.

Another factor is employees scheduling elective surgeries. Now that states are reopening, doctors, in partnership with hospitals, will begin to address previously scheduled elective surgeries that many patients put off.

So what can brokers and benefits consultants do to help their clients? Below are some steps employers can take:

1. Evaluate current paid leave policies. Employers should evaluate their existing paid leave policies and assess what changes might be needed and what gaps might exist as a result of employees needing leave during COVID-19.Also, as more states enact their own, permanent paid leave laws, brokers and benefits consultants should work with their carrier to identify potential unintended gaps in their clients’ benefit offerings and to help them prepare accordingly for the new program. In many cases, a disability policy is needed in addition to the state leave to fill in the gaps for an employee having to take leave due to their own serious health condition.  For many employees, disability coverage is complementary to the state plan. And, it can really help to place both programs with the same carrier to ensure smooth integration for both the employee and employer.

2. Inform and educate employees. It is critical for employers to develop a communications plan for employees that clearly informs them about updated policies and procedures related to new laws. In the case of FFCRA, the federal law requires that employers with fewer than 500 employees communicate updated paid sick, family, and medical leave for employees affected by the COVID-19. This underscores the importance of educating employees about what they are entitled to, since there is a lot of confusion regarding recently passed federal and state paid leave laws. Employees may not know they even qualify for this benefit.

3. Stay compliant. Recommend consolidation of leave management activities to ensure compliance and centralize intake to create efficiencies. As the complexity of managing benefits intensifies, employers are seeking to streamline leave administration and centralize it with a single internal department or vendor.

4. Implementation of a safe work environment. Many employers are beginning to plan for what “return to work” looks like at their company. One thing for certain is the continued focus on the safety and health of employees. To best navigate this, the Centers for Disease Control and Prevention is encouraging companies to implement a COVID-19 Workplace Health and Safety Plan that includes face coverings, social distance guidelines and encouraging sick employees to stay home, to name a few.

With paid leave continuing to be a hot topic along with the safety and health of our workforce, employers can make a positive impact on their employees if done right.

Jennifer Hader is director of disability, absence management and paid leave with Guardian Life. Jennifer may be contacted at [email protected].

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