Paid Leave – Automating Your HR Department

Managing employee leaves of absence has always been challenging due to Human Resource departments’ need to be fully aware of the intricacies of state and federal laws. Creating policies that take into account both factors has always required the use of qualified attorneys and frequent revision given the ever-changing climate.

Policies aside, the duty of triggering and tracking leaves of absence using the appropriate documentation can be a project unto itself. Managers need to be sure they aren’t violating additional regulations, including The Americans with Disabilities Act and HIPAA. Because timing is a huge component of these regulations, a leave manager needs to be focused on each individual leave and where that employee falls in the cycle.

OUTSOURCING LEAVE MANAGEMENT PROGRAMS

As paid leaves continue to expand, it has become difficult for employers to fully understand and manage these processes. As a result, many organizations have chosen to outsource their leave management program to vendors who specialize in this area. These vendors work with the organization to understand existing policies and explain how state and federal laws will be intertwined. Particularly strong vendors in this area assist with training of administrators, managers, and employees either directly or via a “train the trainer” models of security access. Many provide an online portal, with varying degrees of security access, that allows easy access for HR representatives, leave claimants, and their managers.

Several leave management vendors also integrate with disability carriers which allows for fluid communication at each touchpoint. This means that the claimant can make one call and initiate both their disability claim and their request for state or federal leave. This is all then tracked by the vendor, including follow-up steps communicated to the employee through email or physical mail. This strong communicative relationship eases the process of assisting the employee through a difficult period. In advance of the employee’s return to work date, a vendor partner will also take the lead on return to work communications with that employee.

Probably one of the most important features that some vendors can provide is integration with a payroll system, allowing the leave management program to receive automatic updates on employee demographics including terminations and new hires. Not only does this cut down on the manual tracking and submission of data to the vendor, but it also shares the basic demographics of the employees so that when a claim is filed, a majority of the critical information has already been captured within the system. The real bonus to outsourcing leave management is that Human Resources, or whomever in-house handles leaves currently, does not have to hear or see private health information nor do they become the “bad guy” should a leave be denied.

GETTING SET FOR SUCCESS

Implementing and managing these systems has become even more important as Benefits and Paid Time-Off have risen to the top of the list of deciding factors for most job applicants. This is why organizations must take the time to create thoughtful plans in these areas, paying attention to both leaves of absence and vacation time. A 2017 study done by The Project: Time Off Coalition showed that 52% of Americans did not use all of the paid time off allotted to them, specifically vacation days. Their study suggests that the lack of usage has a negative impact on employees in the areas of engagement, health, and stress. With this in consideration, employers should provide strong time off policies that support employees and encourage them to use their vacation time.

Providing paid time off while offering a flexible work environment can be challenging for organizations, especially without the use of a time management program typically connected to a payroll system. With employees working remotely or on the road for much of their work time, it is beneficial for companies to use a system that can manage requests, track attendance, and monitor location via an app. Many systems do offer a mobile app that can track a location via a GPS stamp, which may be important to organizations with travelling teams or off-site workers. Requests for time off are made via the portal (app or web) and they are automatically sent to the supervisor for consideration. The dashboard for some of these systems allows managers to see a more global view of their team or specific employee’s attendance over time, which is most helpful when looking to determine trends of absenteeism.

PTO BANK VS. SEPARATE ALLOTMENTS

Some organizations use a paid time off bank versus a separate allotment for each type of leave: vacation, sick, and personal. A PTO bank in Massachusetts can be tricky, if not impossible, if you are not able to show what time was specifically used for vacation. Massachusetts regulations state that vacation time is considered “wages” and when an employee terminates, all “wages” are due to be paid, including those vacation wages. With the use of a bank, it can be exceptionally difficult to clearly articulate to an employee and to the state, should a wage claim arise, what time was used for vacation versus other types of leave designation. The state also dictates sick, personal, and family time allotments which have to be taken into account if considering a bank method. Because of this, it is important for organizations to consider an efficient system for tracking, allotting and recording time off and leaves of absence. This has the potential to make things easier on HR managers, and reduce confusion among employees.