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Special Enrollment / Qualifying Event Timeline Changes

May 11 - Posted at 9:30 AM Tagged: , , , , , , , , , , , , , ,

Last week the Department of Health and Human Services, DOL and the IRS extended deadlines for multiple items related to health plan administration.  We don’t expect a huge influx of issues from the changes.  However, you should be aware so you don’t inadvertently misinform your employees.    

There were changes made regarding COBRA premium payments and election timeframes but since we have addressed those in a previous post, we won’t address it here.  COBRA administration is outsourced and those impacted are no longer employees so you can direct their questions to your COBRA administrator or to our office.  We’ll also skip the changes made to claims and appeals as that won’t apply to everyone.  That leaves the changes to your benefit program. 

As you are aware, most of the carriers have reduced or even eliminated the minimum number of hours a previously full-time employee must work to be covered by your plan.  Meaning, we can offer coverage to furloughed employees or those that have otherwise reduced hours to below the full-time requirements. 

In addition, the agencies, have decided to disregard the Outbreak Period (the time period between March 1st and at least 60 days after the announced end of the COVID 19 National Emergency) when establishing a deadline to request enrollment in coverage for certain qualifying events.  Meaning, the agencies, added a “pause” to the time frame required for employees to notify you about special enrollment periods, such as marriage or birth of a child.  We are not able to determine the exact end date of the Outbreak Period yet as that is based on an end to the National Emergency (and that had yet to be determined). 

For our examples, we’ll assume the COVID 19 National Emergency ends for the country on June 30th.  This would make the Outbreak Period March 1st to August 29th (60 days following June 30). 

Example 1 – Sally has a baby on March 3rd.  Normally, she would have 30 days to notify us that she would like to add the baby.  However, you are being instructed to disregard the Outbreak Period, therefore she has until September 28th (30 days from the end of the Outbreak Period) to let us know her desire to add her child.

Example 2 – Tom gets married June 1st.  He will have until September 28th to let us know if he intends to enroll his spouse. 

Under these examples, the dependents would be enrolled back to their original eligibility date and the employee would owe those back premiums.  I don’t expect this to become a big issue, however, depending on the employees circumstances it could.  The drawback to employers, other than the inconvenience, is this could have an impact on the group claims.  Normally Tom and Sally would only have 30 days to enroll their dependents.  With the extensions, employees have information about any issues or medical expenditures that have already happened along the way.  Carriers will be responsible to back up, enroll the dependent, and pay any claims incurred. 

Please let us know of any questions you have. 

DOL Throws COVID-19 Curveball In Latest Guidance Suggesting Shut Down Employees Won’t Qualify For Leave

March 30 - Posted at 10:19 AM Tagged: , , , , , , , , , ,

The Department of Labor (DOL) continues to update its guidance document on implementation of the Families First Coronavirus Response Act (FFCRA), and the latest update caught many employers by surprise. The updated document released by the agency appears to suggest that employees who cannot work because their businesses are subject to a government shutdown order or they are ordered to shelter at home will not qualify for Emergency Paid Sick Leave or Emergency FMLA. This clarification should now be integrated into employers’ plans for developing best practices and compliance tools to deal with the rapidly changing situation.

Last week, the DOL issued FAQs that covered the effective date of the FFCRA (April 1), how to calculate whether your business meets the 500-employee threshold, whether the law will be retroactive in nature, and how the Emergency FMLA and Emergency Paid Sick Leave provisions should be applied in leave situations caused by school closures. In the latest update, DOL covered several additional issues you will want to review to ensure compliance. 

Employees Forced Home By Shutdown Orders Alone Excluded From Paid Leave?

The DOL’s guidance appears to suggest that if employers send home workers and stop paying them, these workers are not entitled to paid sick leave or expanded family and medical leave if the “employer closes [the] worksite for lack of business or because it is required to close pursuant to a Federal, State, or local directive.” This would be true whether the closure occurs before or after April 1st, the effective date of the law, and even if workers requested leave prior to the closure.

Similarly, if an employer closes its business while workers are already out on Emergency Paid Sick Leave or Emergency FMLA, it must still pay for any paid sick leave or expanded family and medical leave used before the closure, but it has no further obligation to provide Emergency Paid Sick Leave or Emergency FMLA as of the date of the closure.

Instead, the agency directs workers to determine whether they are eligible for unemployment insurance benefits, pointing them to their state workforce agency or unemployment insurance office for specific eligibility questions. The guidance also reminds workers that they will not be eligible for unemployment insurance if their employer is still paying them pursuant to a paid leave policy or state or local requirements.

Furlough v. Layoff: Distinction Without A Difference?

Questions have also been raised over the difference between “furloughs” and “layoffs.” For purposes of paid sick leave or emergency family and medical leave, DOL’s updated comments appear to suggest that the agency equates “furlough” to any layoff where employees are no longer working. And, as explained above, furloughed employees are not entitled to Emergency Paid Sick Leave or Emergency FMLA regardless of whether their employment has officially ended.

Certification Confusion

As of late Thursday (3/26/2020), the FAQs posted on the DOL’s website instructed all employers to maintain detailed documentation about any Emergency Paid Sick Leave or Emergency FMLA taken by their workers in order to later prove eligibility for tax credit reimbursement. But, by late Friday evening (3/27/2020), the answer changed. The DOL now says employers must collect documentation in support of leave “as specified in applicable IRS forms, instructions, and information.” To date, the IRS has not yet released any such certification forms.

The DOL also says that employers can require workers to provide additional documentation in support of Emergency FMLA taken to care for children whose school or place of care is closed, or if a child care provider is unavailable, due to COVID-19-related reasons.  This could include a notice of closure or unavailability from a school, place of care, or child care provider, including a notice that may have been posted on a government, school, or day care website, published in a newspaper, or emailed from an employee or official of the school, place of care, or child care provider.  

The Reality Of Telework

The DOL also provided a series of questions and answers addressing the increasing reality of compulsory telework around the nation and its interplay with FFCRA benefits. The agency indicates that employers can adjust typical work schedules to accommodate remote workers, and so long as the employees are able work their regularly scheduled hours, such workers would not be eligible for Emergency FMLA or Emergency Paid Sick Leave.

But, if a worker is unable to work remotely or otherwise perform work the required hours because of one of the qualifying reasons, then the employee would be entitled to take Emergency Paid Sick Leave. Similarly, if because of COVID-19 related reasons an employee is unable to perform teleworking tasks or work the required teleworking hours because of a need to care for a child whose school or place of care is closed, the worker would be entitled to take Emergency FMLA.

Intermittent Leave

Finally, the DOL confirmed that employees may be able to take Emergency FMLA or Emergency Paid Sick Leave intermittently while teleworking – if the employer agrees. If an employee is unable to telework their normal schedule of hours due to one of the qualifying reasons in the Emergency Paid Sick Leave Act, an employer may agree to allow an employee to take paid sick leave on an intermittent basis while teleworking. Similarly, if someone is prevented from teleworking their normal schedule of hours because they need to care for a child whose school or place of care is closed, or their child care provider is unavailable because of COVID-19 related reasons, an employer may allow the employee to take Emergency FMLA leave intermittently while teleworking.

Intermittent leave can be taken in any increment, provided that the employer and employee agree. For example, if you agree on a 90-minute increment, an employee could telework from 1:00 PM to 2:30 PM, take leave from 2:30 PM to 4:00 PM, and then return to teleworking. “The Department encourages employers and employees to collaborate to achieve flexibility and meet mutual needs,” the DOL’s updated Q&A says, “and the Department is supportive of such voluntary arrangements that combine telework and intermittent leave.”

As for intermittent leave for those workers able to work at a job site, this would depend on the reason the employee is taking the leave and whether the employer agrees. Emergency Paid Sick Leave in non-telework situations must be taken in full-day increments. It cannot be taken intermittently if the leave is being taken because an employee:

  • Is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
  • Has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
  • Is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  • Is caring for an individual who either is subject to a quarantine or isolation order related to COVID-19 or has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; or
  • Is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.

Once paid sick leave for one or more of these qualifying reasons begins in a non-teleworking situation, employees must continue to take paid sick leave each day until they either (1) use the full amount of paid sick leave or (2) no longer have a qualifying reason for taking paid sick leave. This limit is imposed because FFRCA’s intent is to provide such paid sick leave as necessary to keep you from spreading the virus to others.

However, if an employee and employer agree in non-telework situations, Emergency Paid Sick Leave can be taken intermittently to care for a child whose school or place of care is closed, or whose child care provider is unavailable, because of COVID-19 related reasons. Similarly, Emergency FMLA can be available in such a situation with an employer’s permission and when an employer can agree upon such a schedule with a worker.

Conclusion

While much confusion remains, and further clarity on these and other points will need to be made by DOL, this updated guidance begins to flesh out some of the more complicated issues that have been vexing those employers trying to figure out how to comply with the new law come April 1, 2020. Still, you should expect further revisions and clarifications as the agency – and employers – begin the process of implementing this unprecedented, new law. You should not be surprised if you see the FP COVID-19 Taskforce publish additional explanations on this and other aspects of the CARES Act.

We will continue to monitor the rapidly developing COVID-19 situation and provide updates as appropriate.

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