Four Misunderstood Terms in the Americans with Disabilities Act

by admin | Dec 23, 2024 | Uncategorized

The Americans with Disabilities Act (ADA) applies to employers with 15 or more employees. Despite its broad coverage, there’s a lot of confusion about what the law requires and what its terms entail. A big reason for this confusion is the language of the law itself; the ADA speaks of nebulous concepts like undue hardship and reasonable accommodation. Words like undue and reasonable are by their nature open to some interpretation, which is not exactly a comfort to employers.

Fortunately, employers can feel confident in their application of the law by reviewing and understanding its most important concepts. In this article, we’re going to define and analyze the terms disability, undue hardship, reasonable accommodation, and interactive process. These are the big four terms that serve as the foundation of your responsibilities as an employer under the ADA.

Disability

Let’s start with the term disability. Under the ADA, a person with a disability is someone who:

• Has a physical or mental impairment that substantially limits one or more major life activities;
• Has a record of such an impairment; or
• Is regarded as having such an impairment.

Major life activities include caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working. A major life activity also includes the operation of a major bodily function, such as digestive, circulatory, and reproductive functions.

Although determining whether an impairment meets the definition of disability is an individualized assessment, some conditions “virtually always qualify.” For example, according to the EEOC, deafness substantially limits hearing; HIV substantially limits immune function; and bipolar disorder substantially limits brain function. Other conditions may vary from case to case in whether they substantially limit a major life activity.

It’s important to note that the definition of disability is broad. After the ADA was originally passed, the courts interpreted the definition very narrowly, and Congress responded by amending the ADA in 2008 so that more disabilities are covered. If an employee asks for an accommodation because of a physical or mental condition, it often won’t be hard for them to show that the condition substantially limits a major life activity.

Reasonable Accommodation

Employers often encounter the ADA when an applicant or employee asks for a reasonable accommodation. A reasonable accommodation is a change to the workplace or the job application process so that people with disabilities can perform the essential functions of their job, access employment benefits, or be considered for a job they’re qualified for. The intent of reasonable accommodations is to remove workplace barriers for people with disabilities—barriers that don’t prevent people without disabilities from performing the work or applying for the job. But don’t focus too much on the word reasonable; in the context of disability accommodations, reasonable means feasible or plausible.

Common types of accommodations include modifying work schedules, altering the way job duties are done, re-assigning a non-essential job duty (like asking the receptionist to stack the monthly 100-lb paper delivery in the storage room), granting additional breaks, providing accessible parking, and providing materials in alternative formats (e.g., Braille, large print). Another type of accommodation is a temporary leave of absence. Although a bit counterintuitive (because the employee isn’t working while on leave), the theory with a leave as an accommodation is that the time off will enable to employee to perform the essential functions of their job when they return.

Not every requested accommodation is required, however. For one, employers don’t have to remove an essential job function (e.g., the receptionist can still be expected to answer the phone). Employers also aren’t required to provide items for personal use, like wheelchairs or hearing aids. And, as we turn to next, an accommodation doesn’t have to be provided if it causes an undue hardship.

Undue Hardship

Under the ADA, an employer is not required to provide reasonable accommodations to employees or applicants with disabilities if doing so creates an undue hardship on the organization. The basic definition of undue hardship is an action that creates a significant difficulty or expense. Generally, this is a high standard to meet.

The cost of an accommodation could be an undue hardship on the employer, but so could an accommodation’s duration or disruption. An accommodation that would fundamentally alter the nature or operation of the business would be an undue hardship even if the cost was negligible. But if cost alone is the basis for claiming undue hardship, employers should remember that the standard is a significant expense.

Undue hardship is determined on a case-by-case basis, considering the following factors:

• The nature and net cost of the accommodation, including the availability of tax credits and deductions, as well as outside funding;
• The overall financial resources of the facility providing the accommodation, the number of employees at the facility, and the effect of the accommodation on expenses and resources;
• The employer’s overall financial resources, size, number of employees, and the number, type, and location of its facilities;
• The type of operation of the employer, including the composition, structure, and functions of the workforce, and the geographic separateness and administrative or fiscal relationship of the facility providing the accommodation; and
• The impact of the accommodation on the operation of the facility, including the impact on the ability of other employees to perform their duties and the impact on the facility’s ability to conduct business.

An employer can’t claim undue hardship based on employee or customer fears or prejudices toward the disability. An undue hardship also can’t be based on the possibility that an accommodation could reduce employee morale.

Interactive Process

The interactive process is an ongoing conversation between the employer and employee to explore potential accommodations so that the employee can perform their essential job functions or access the benefits or privileges of their job.

Basically, the interactive process starts with brainstorming. The employee—and in some cases their medical provider—is often the best source for accommodation options. However, the employer should do some research too, for example, by searching for the disability or functional limitation on the Job Accommodation Network website.

Next, the employer chooses an accommodation from all the options. Employers should give consideration to which accommodation the employee prefers, but, at bottom, whatever accommodation they choose must be effective. If it’s not clear initially, the employer can implement an accommodation for a trial period to determine whether it’s effective. If that accommodation doesn’t work, employers should then try a different accommodation. In addition, circumstances may change over time, so the best practice is to keep an open dialogue with the employee to see if further adjustments are needed throughout the employment relationship.

By Megan LeMire

Originally posted on Mineral

Compliance Recap

by admin | Feb 28, 2024 | Uncategorized

QUESTION OF THE MONTH

Q: My wife and I work in the same small company. Is having her on my plan as spouse allowed? Can we both contribute separately from our own paychecks into our own Health Savings Account (HSA)? Or does it need to be my deduction only since I am the policy holder?

A: Yes, each spouse can have an HSA. The family limit, however, is divided between the two spouses, meaning the contributions to both HSAs combined cannot exceed the family HSA contribution limit.

Compliance Recap January 2024

by admin | Feb 20, 2024 | Uncategorized

NEW EMPLOYEE CLASSIFICATION RULE

In January, the Department of Labor (DOL) Wage and Hour Division introduced a rule that changes the way workers are classified under the Fair Labor Standards Act (FLSA). This Final Rule, effective March 11, 2024, offers a more comprehensive test to determine a worker’s status, potentially making it more challenging to classify workers as independent contractors for FLSA purposes. The rule is limited to FLSA wage and hour requirements and does not impact rules related to retirement or health and welfare benefits, which are typically governed by ERISA and the Internal Revenue Code. However, this change could lead to confusion and possibly claims for benefits. Under the federal FLSA, employees are entitled to minimum wage, overtime pay and other benefits. Independent contractors are not entitled to such benefits, but generally have more flexibility.

The rule establishes a test examining six key factors:

1. Opportunity for profit or loss
2. Investments by the worker and employer
3. Permanence of the work relationship
4. Degree of control
5. Extent to which work is integral to the employer’s business
6. Worker’s skill and initiative

These factors guide the assessment but are not exhaustive and none carry greater weight. This broadened definition under the FLSA could lead to more independent contractors being classified as employees for FLSA purposes. The DOL has provided Fact Sheet 13 to assist in the proper classification of workers.

The reclassification of workers as employees under the FLSA could have significant implications, particularly regarding employee benefits. For retirement benefits, this could mean an increase in eligible retirement plan participants, affecting employer obligations under plans like 401(k). Changes in FLSA classification may also influence health benefits, potentially increasing employers’ obligations under the employer mandate rules. This highlights the importance of careful planning and potential adjustments to existing plans and policies. Moreover, the new rule might trigger additional reporting requirements for employers, especially if they surpass certain thresholds.

EMPLOYER CONSIDERATIONS

Employers and HR professionals should understand and adapt to these changes, particularly in the gig economy, where many workers are currently classified as independent contractors. The rule’s emphasis on a totality-of-the-circumstances analysis for worker classification requires careful consideration of various economic factors. Given the potential for ongoing regulatory developments and challenges to the rule, it’s essential for employers to stay informed and prepare for possible impact on their operations and worker classifications.

GUIDANCE ON COVERAGE FOR CONTRACEPTIVES

The Affordable Care Act (ACA) Implementation FAQs Part 64, issued on January 22, 2024, provide guidance on preventive service coverage. Prepared by the Departments of Labor, Health and Human Services, and the Treasury, they aim to enhance understanding and compliance with the law and specify that non-grandfathered health plans must cover certain preventive services without cost-sharing. These services include recommended immunizations, preventive care for infants to adolescents, and additional preventive care for women. The guidelines allow plans to use reasonable medical management techniques to determine coverage limitations for services not explicitly detailed in recommendations.

The FAQs also detail the coverage of contraceptives and contraceptive care and advocate for comprehensive contraceptive care for adolescent and adult women, including a wide range of FDA-approved contraceptives and family planning practices. Plans and issuers are required to cover contraceptive services and products deemed medically appropriate by a patient’s provider. The guidelines also address the use of reasonable medical management techniques within contraception categories.

Despite these clarifications, the FAQs acknowledge ongoing barriers to accessing contraceptive coverage without cost-sharing. They outline examples of potentially unreasonable medical management techniques, such as excessive step therapy protocols, age-related restrictions, and burdensome administrative requirements in exceptions processes. The Departments emphasize the need for an expedient and transparent exceptions process to ensure coverage of medically necessary contraceptive services and products.

Finally, the FAQs introduce guidance on a therapeutic equivalence approach that plans and issuers may adopt. This approach, combined with an accessible and expedient exceptions process, aims to comply with the requirements regarding contraceptive coverage. This approach would support the coverage of contraceptive drugs and devices, facilitating better access to contraception without cost-sharing.

EMPLOYER CONSIDERATIONS

Individuals who have concerns about their plan’s or issuer’s compliance with the contraceptive coverage requirements may contact the Department of Labor (DOL) via its website or toll free at 1-866-444-3272.

CALIFORNIA SICK LEAVE FAQS

California’s Labor Commissioner updated its FAQs to reflect changes to the Healthy Workplaces Healthy Families Act (HWHFA) that are effective January 1, 2024. These amendments include an increase in the amount of leave employees can accumulate, carry over, or use. The updates also provide guidance on the accrual-based or frontloading methods for compliance and clarify that employers can ask for documentation to substantiate leave but cannot deny leave solely based on a lack of medical certification.

The new amendment impacts employees covered by collective bargaining agreements (CBAs) in specific ways. Beginning January 2024, these workers can use paid leave for similar reasons as others under the HWHFA, without the need to find a replacement worker. They are also protected under the law’s anti-retaliation provisions. However, the FAQs are unclear as to the way the changes align with CBAs’ arbitration provisions.

EMPLOYER CONSIDERATIONS

California employers must review and revise their paid sick and safe leave policies to comply with these changes and are required to display a poster in an area frequented by employees where it may be easily read during the workday.

The workplace posting must state:

• That an employee is entitled to accrue, request, and use paid sick days
• The amount of sick days provided for and the terms of use of paid sick days
• That retaliation or discrimination against an employee who requests paid sick days or uses paid sick days or both is prohibited
• That an employee has the right under this law to file a complaint with the Labor Commissioner against an employer who retaliates or discriminates against an employee

NEW YORK PROPOSED PAID FAMILY LEAVE EXPANSION

New York Governor Kathy Hochul has proposed an expansion of the state’s paid family leave law to include 40 hours of paid leave for prenatal medical appointments. This initiative, aimed at improving maternal and neonatal health, would make New York the first state to offer such coverage. The proposal is part of a broader effort to address rising maternal mortality rates, particularly among Black women, and to reduce unnecessary cesarean section births. New York already offers four months of paid leave; however those benefits are unavailable until four weeks before birth. The proposed changes reflect a growing recognition of the importance of prenatal care and the need to address disparities in maternal health outcomes.

EMPLOYER CONSIDERATIONS

Until this proposed expansion becomes law, employers in New York can ensure their familiarity with current law and required disclosures.

QUESTION OF THE MONTH

Q: Should veterans be excluded from the full time equivalent (FTE) count for determining if an employer is considered an applicable large employer (ALE)?

A: If the veteran employees have Tricare or receive health insurance through the Department of Veterans Affairs, they do not count for purposes of determining whether an employer is an applicable large employer.

Answers to the Question of the Week are provided by Kutak Rock LLP. Kutak Rock provides general compliance guidance through the UBA Compliance Help Desk, which does not constitute legal advice or create an attorney-client relationship. Please consult your legal advisor for specific legal advice.