Although time away from work (TAFW) is valued by employees and can impact retention and engagement, it can be complicated for plan sponsors to communicate and administer, and emotional for participants. Optimizing TAFW administration is a worthwhile endeavor for plan sponsors that want to manage these benefits more effectively and improve their employees' experience.

What is TAFW?

When employees hear "time away from work," they usually think of holidays, vacation time or other routine paid time off (PTO) events. But TAFW can also be triggered by infrequent yet significant life events, such as major illnesses or injuries, the birth of a baby, caring for an elderly parent or serving in the military. TAFW policies may also cover unpaid leaves of absence, such as personal sabbaticals or time taken to pursue charitable activities, during which employees' jobs are protected.

What makes it complicated?

It is important that benefits associated with TAFW events, such as short-term disability (STD), long-term disability (LTD), maternity leave and military leave, be administered consistently across the organization in a nondiscriminatory manner. Yet administration can be difficult, involving coordination among internal and external parties such as human resources (HR), human resource information systems (HRIS), payroll, benefits administration, legal, third-party leave administrators and the employee's manager and medical care providers. TAFW can involve an employee's personal health information (PHI) that is protected under the Health Insurance Portability and Accountability Act (HIPAA). There are regulatory issues to consider too, such as job protections under the Family and Medical Leave Act (FMLA) and Uniformed Services Employment and Reemployment Rights Act (USERRA), and plan sponsors must coordinate company benefits with workers compensation and disability insurance requirements in certain states. These issues can be further complicated for employers with a decentralized workforce or with both hourly and salaried employees. There is also an emotional component to consider, as employees utilizing TAFW benefits may be facing situations that strain their health, family and finances or may require special accommodations to return to work.