Further Clarification on FMLA and Attendance Policies

Further Clarification on FMLA and Attendance Policies

Attendance policies have long created headaches for HR professionals when it comes to administering FMLA. In light of a new DOL Opinion Letter that addresses FMLA and no-fault attendance policies, this is a good time to revisit that topic.

If you didn’t see them yet, the DOL issues several new Opinion Letters yesterday including two that are related to confusing FMLA topics.

Here’s a link to each of them:

FMLA2018-1-A: “No-fault” attendance policies and roll-off of attendance points

FMLA2018-2-A: Whether organ donation is a serious health condition

And just for good measure, I want to highlight this FLSA Opinion Letter since many of you also administer employee benefits and wellness plans along side your company’s leave of absence processes. Basically, it states that you do not have to pay employees for the time they spend doing voluntary wellness activities even if they are directly tied to monetary rewards or health plan discounts.

FLSA2018-20: Compensability of time spent attending employer-sponsored benefit fairs

 Attendance Policies and FMLA

The new Opinion Letter states that if you have an attendance policy that gives points or occurrences for unplanned absences that has a rolling calendar where points fall off at some point, you can suspend or freeze that rolling calendar while an employee is on an FMLA leave provided that you do that for other types of leaves.

You must still refrain from issuing occurrences for FMLA absences.

If your company issues an occurrence for any unplanned absences. An employee can receive up to 8 occurrences in any 12-month period before facing termination.  The occurrences fall off after they have been on the employee’s record for 12 months. So, an occurrence received on June 3rd, 2018 would fall off on June 3, 2019.

If an employee takes a 3 month leave of absence, you can extend their rolling 12-month calendar for occurrences by 3 months.

Here’s an example:

Joan receives the following occurrences for unplanned absence: 1/10/18, 1/25/18, 2/21/18, 4/4/18, 7/17/18

She currently has 5 occurrences.  Normally, her first occurrence would fall off on 1/10/19. However, she took a 3-month maternity leave from 8/10/18 to 12/1/18. Because she was not at work for 3 months during the year you can extend her rolling calendar for occurrences, meaning that her occurrence from 1/10/18 would not fall off until 4/4/18. You would continue that extended calendar until 12 months following her leave of absence (12/1/19).

It’s worth stating again that you must treat all other leaves of the same nature the same way.

Perfect Attendance Policies

One of the very first DOL Opinion Letters in 1993 addressed questions about how to handle perfect attendance policies and FMLA and I think it’s worth revisiting along with this update on attendance policies.

So how should you handle perfect attendance when someone misses work under FMLA?

Here’s the short answer: Absences under FMLA cannot have an adverse impact on eligibility for an attendance bonus and must be treated the same as otherwise similar absences.

Here’s a summary of what the Department of Labor’s opinion letters and non-administrator interpretations say about attendance and production bonuses.

  • You cannot use FMLA leave as a factor in qualifying for an attendance bonus.
  • You can prorate the amount of the bonus for absences under FMLA, but only if you would prorate it for other types of absences.
  • You cannot use the failure to earn a bonus due to FMLA leave as a factor in other employment decisions, such as disciplinary action, promotional opportunities, etc.

Here are some examples.

Example 1: Your company has a monthly perfect attendance bonus that is paid if the employee does not have any unplanned absences.

  • An employee has an unplanned absence due to the flu. The employee is not eligible for the bonus.
  • An employee has two unplanned absences to care for a child under FMLA. The employee would be eligible for the perfect attendance bonus.
  • An employee has four unplanned absences. One due to a flat tire and three under intermittent FMLA. The employee would not be eligible for the perfect attendance bonus.

Example 2: Your company has a monthly perfect attendance bonus that is paid if the employee does not have any unplanned absences and is paid at a pro-rated amount for days missed for planned absences such as vacation time or any FMLA absences.

  • An employee misses one week of work for a planned vacation. The employee would receive ¾ of the perfect attendance bonus because they worked three out of the four weeks in the month.
  • An employee misses one week of work under FMLA. The employee would receive ¾ of the perfect attendance bonus because they worked three out of the four weeks in the month.
  • An employee produces zero widgets because they were on a continuous FMLA leave and were not at work during the entire week (i.e. the entire bonus period). The employee would not receive their bonus.

Here’s our recommendation on perfect attendance:  

Overall, we don’t recommend variable pay programs that are tied to attendance. They often encourage employees to come to work when they are sick, which prolongs their illness, or infects other employees, or both.

If you must, we recommend a perfect attendance bonus that only factors in unplanned absences that are not covered under FMLA (like the attendance bonus in Example 1). The prorated attendance bonus policy in Example 2 is used as an example in one of the DOL opinions, but it’s more complicated to administer than it’s worth.

What does Leave Solutions do? Leave Solutions was started in 2016 to help fill a gap in options for outsourcing FMLA administration. If you don’t want the burden of administering FMLA in-house but don’t want to outsource to a call-center-style insurance company, then Leave Solutions is the answer. We administer FMLA as an extension of your HR team and can customize our processes to meet your exact needs.

 We hope you enjoyed reading our article on Update: FMLA and Attendance Policies.

Leave Solutions is based in Milwaukee, WI and helps employers with their FMLA and leave of absence processes from a Human Resources perspective.

Contact us today at info@leavesolutions.com if you have questions on attendance policies or other topics.

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