In this issue:

• Getting a Hold on Employee Vacation Planning
• Top 5 Employer FMLA Mistakes
• What is the Best Approach to Conducting an Employee Investigation?
• Traditional 401(k)? Roth 401(k)? What’s the Difference?
• Did You Know?

Top 5 Employer FMLA Mistakes

Even in the middle of summer, employers should never take a vacation from dealing with Family and Medical Leave Act’s (FMLA’s) requirements. There are a number of missteps an employer can take – and we recommend employers shore up FMLA compliance efforts by avoiding the following common mistakes.

1. Counting Light-Duty Work as FMLA Leave
Employers often make the mistake of offering light-duty work to employees and counting it as FMLA leave. Light-duty work can be offered but must not be required in lieu of FMLA leave. For example, an employer can offer tasks that don’t require lifting to an employee who hurt his or her back and cannot perform heavy lifting. But if the worker wants the time off, the individual is entitled to take FMLA leave.

2. Untrained Supervisors
Untrained front-line supervisors might retaliate against employees who take FMLA leave, dissuade workers from taking leave, or request prohibited medical information, all of which violate the FMLA. Just because front-line supervisors shouldn’t administer FMLA leave doesn’t mean they shouldn’t be trained on the FMLA.

3. Missed Notices
The FMLA requires employers to provide four notices to employees seeking FMLA – and sometimes employers fail to provide these required notices to employees. Employers must give:

• • General Notice of FMLA Rights
  • Eligibility Notice within five days of the leave request
  • Rights and Responsibilities Notice within five days of the leave request
  • Designation Notice within five business days of determining that leave qualifies as FMLA leave

4. Incomplete Certifications
Employers sometimes accept certifications of a serious health condition that are incomplete and inconsistent. In particular, businesses can make the mistake of accepting certifications that do not state the frequency and duration of the intermittent leave that is needed.

5. Overlooking the ADA
Employers sometimes fail to realize that a serious health condition that requires 12 weeks of FMLA leave will likely also constitute a disability under the Americans with Disabilities Act (ADA). Even after 12 weeks of FMLA leave, more leave may be required by the ADA or state or local law as a reasonable accommodation. Document any adverse effects on productivity, ability to timely meet client demands and extra workload on co-workers resulting from an employee on extended FMLA leave. While the FMLA doesn’t have an undue hardship provision, the information will be necessary for a proper analysis of whether any request by an employee for further leave as an ADA accommodation is reasonable or is an undue hardship.

Should you have any questions about FMLA compliance or how to administer the leave, please contact your Client Services Specialist at 410-451-4202.

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What is the Best Approach to Conducting an Employee Investigation?

As a supervisor, your employee approaches you to complain that another employee has been harassing him or her during and after working hours. You have now been put on notice of a serious situation and need to conduct an Employee Investigation. Being prepared from the very beginning is critical in successfully and fairly administering the interview and developing a final report. Following the steps outlined below will assist you in navigating the highly sensitive process.

1. Determine if a problem exists.
This is actually an essential step. There are situations when there is just a miscommunication or two people just can’t get along. Have the accuser provide you with a signed written statement that clearly outlines what is the perceived issue.

2. Select who will investigate the issue.
Depending on the gravity of the issue, or who is involved, you may elect to have a third party conduct the actual investigation. By doing so you can avoid any issues of bias and in many instances the parties involved tend to more readily accept the third party’s conclusion then that of the internal investigator.

3. Prepare for the investigation.

• • Script out questions to help yourself stay on track for the complainant, the subject being accused, and the witnesses. Also important in navigating any investigation is consistent practices. Treat each person being interviewed with fairness to avoid any discrimination claims and help avoid any future claims of impropriety.
  • Ensure the complainant, witnesses, and accused are told that no conclusions have been reached and that is why you are carrying out this investigation.
  • Gather information so the determination is based upon facts and not perception, hearsay, or speculation. Make sure you keep your opinions to yourself and do not interject during the interviewing process.
  • Conduct follow-up interviews, if needed. If you find holes in some of the information you have received, by all means – re-interview individuals to gain more insight so a sound decision can be made based on actual facts.

4. Evaluate all the documentation you gathered and DOCUMENT.
Review all the information you have gathered in order to prepare your final report. You should consider incorporating your employment attorney to review your documentation to ensure you are adhering to all laws and policies.

5. Prepare the investigative report.
The final report should summarize the incident or issue investigated as well as outline the process used in the investigation, any recommendations or remedying the situation, and a list of those interviewed for the investigation. Make sure your documentation is clear, concise, and is filed separately.

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 Traditional 401(k)? Roth 401(k)? What’s the Difference?

Many employers currently offer a traditional 401(k) and more and more employers are now offering another valuable option – a Roth 401(k). According to Aon Hewitt’s 2014 Universe Benchmarks report, employees saving for retirement in workplace 401(k) plans are increasingly choosing the Roth option.

What are the key differences between the two options?

• Contributions to a traditional 401(k) account are not subject to federal and state income taxes for the year during which you make the contributions. When you make withdrawals in retirement, you’ll pay ordinary income taxes at the federal and state income tax rates applicable to you at that time.
• It’s the other way around for a Roth 401(k) account. Contributions are subject to federal and state income taxes in the year you make the contributions. Withdrawals in retirement are not subject to income tax rates.
• Maximum contributions for either the traditional 401(k) or the Roth 401(k) are the same – $18,500 in 2016. If you contribute to both a traditional and Roth 401(k), the sum of your contributions cannot exceed the limit.

Additionally, under a traditional 401(k) plan, if a person reaches age 70 and is no longer working, he or she must start taking required minimum distributions. However, for some people, taking money from tax-deferred savings at age 71 may not be desirable. While Roth 401(k)s do appear to be subject to the minimum required distribution rules, Roth 401(k) distributions can be rolled over into Roth IRAs, which do not require distributions.

As an employer, how do you decide whether to add this option to your benefits package?

One factor is the composition of your workforce (age, pay levels, sophistication) as well as the “push” from your employees. Younger employees may express interest due to their long-term investing horizons, and older employees – who as high-earners are barred from contribution to a Roth IRA or who want to maintain their 401(k) savings as a tax-free nest egg for their heirs – may be interested as well.

If you have any questions about your account or would like more information on HRi’s Traditional 401(k) and Roth 401(k) options, please contact Alison Lalla, 401(k) Administrator, by phone (443-321-7713) or by email (alison@hri-online.com).