Disability Benefits

EMPLOYEE BENEFITS INFOSOURCE® Search Results


These executive summaries were compiled from EMPLOYEE BENEFITS INFOSOURCE database, a source for information on employee benefits and human resources.
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Court Affirms Denial of Benefits and Awards Attorney Fees.
Benefits Magazine; v51 no8 p 53 Aug 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The employee plaintiff in Spenrath v. Guardian Life Insurance Co. of America had seizurelike episodes that were not definitively diagnosed by her primary physician and two neurologists. She failed to undergo additional recommended testing. Inability to focus and poor performance reviews led her to stop work three years later and seek long-term disability benefits. The defendant plan administrator denied the claim, lacking medical evidence of any condition causing the functional impairment. The district court found the administrator properly considered all evidence provided and granted attorney fees for the defendant. The Fifth Circuit Appeals Court found no substantial evidence of disability, upheld the lower court, affirmed the attorney fee award and granted the defendant an additional $6,000 for attorney fees for the prolonged litigation of the plaintiff's weak case.
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Court Upholds Disability Plan's Discretion and Full and Fair Review Process.
Benefits Magazine; v51 no8 p 57 Aug 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The plaintiff in Prezioso v. Prudential Insurance Company of America was injured at work and fired the next day for failing to meet sales targets. He applied for but was denied short- and long-term disability benefits. The plan administrator stated the injury did not prevent the plaintiff from performing his job during the plan elimination period. The district court granted summary judgment for the defendant. The plaintiff appealed contending the court wrongly used the abuse of discretion standard of review since the plan language did not specify discretion for the defendant. The Eighth Circuit Appeals Court disagreed, finding wording regarding proof of disability satisfactory to the plan to clearly indicate discretion.
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Employers, Employees Increasingly at Odds Over Wellness Incentives.
Employer's Guide to Fringe Benefit Rules; v21 no2 pp 7-8 Aug 2014; journal article

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Abstract : A Kaiser Family Foundation survey found 76 percent of general public respondents support wellness programs, but 62 percent oppose mandatory employee participation, with similar results found among adults with employer-sponsored health insurance. Women are more likely to participate at 73 percent compared to 54 percent of men. The Society for Human Resource Management shows shifts in prevalence of wellness programs to contain long-term health care costs, used by 36 percent of respondents in 2014, 43 percent in 2013 and 28 percent in 2012. Incentives were most widely used for getting yearly health risk assessments, refraining from tobacco use and wellness program participation. Aon Hewitt reports one in five employers use tiered incentives, richer for those carrying out specific wellness activities and basic for others.
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Court Affirms VEBA's Denial of Disability Benefits.
Benefits Magazine; v51 no7 p 60 Jul 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The Second Circuit Appeals Court ruled in St. Onge v. Unum Life Insurance Company of America that the defendant's benefit denial did not amount to abuse of discretion. The voluntary employee benefits association (VEBA) plan administrator found the plaintiff not disabled and denied disability benefits. The plaintiff asserted the defendant ignored evidence and misconstrued the record, applied the wrong criteria to assess the demands of the job and had a conflict of interest. The administrator consulted independent physicians, arranged a functional capacity exam and reviewed the plaintiff's physician's opinion. The Appeals Court found the medical review sufficient, the job task analysis unpersuasive and any conflict of interest to be absent, upholding summary judgment for the defendant.
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Court Awards Attorney Fees to Successful Plaintiff in Claim for Disability Benefits.
Benefits Magazine; v51 no7 p 62 Jul 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : After an employee suffered debilitating anxiety and depression following heart surgery, he applied for but was denied long-term benefits, despite his psychiatrist's recommendation. In Donachie v. Liberty Life Assurance Company of Boston the district court granted summary judgment for the plaintiff but denied the requested attorney fees. The Second Circuit Court of Appeals ruled the defendant's denial of disability benefits was arbitrary and capricious for ignoring substantial medical evidence. Considering the issue of attorney fees, the court noted fees should be granted to a prevailing party unless there is particular justification for not doing so. Finding no such justification, the appeals court vacated that portion of the lower court's decision and remanded the case to determine reasonable attorney fees for the plaintiff.
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Court Dismisses Benefit Claims Under the ERISA Antiretaliation Statute.
Benefits Magazine; v51 no7 p 61 Jul 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The Fifth Circuit Court of Appeals upheld the lower court's grant of summary judgment for the defendant in Parker v. Cooper Tire and Rubber Company. Fired for missing several work days and failing to provide proper notice, the plaintiff sued for wrongful termination to avoid having to pay medical costs and for violating ERISA Section 510 on retaliation. The district court found the plaintiff did not establish a case showing specific intent to interfere with his benefits since the plaintiff had never applied for long-term disability benefits. The Appeals Court agreed and noted no retaliation claim could be based on the short-term disability benefit plan since it was not an ERISA plan. The court also noted the plaintiff could not establish a prima facie ERISA retaliation case since he was physically unqualified to perform his job.
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Disability Insurance Benefits Impact Employees' Financial Outlook.
Owenby, Matthew; Employee Benefit Plan Review; v69 no1 pp 14-15 Jul 2014; journal article

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Abstract : Being unable to work for a year would be financially devastating for nine in ten households, according to America's Health Insurance Plans, but voluntary disability insurance can provide a financial safety net. Offering disability insurance as an option has little monetary effect on an employer but serves as a competitive advantage with employees. While few employees think much about disability, the Social Security Administration reports that one in four 20-year olds will become disabled before retirement age, most likely from a chronic illness. Disability insurance pays cash benefits for costs not covered by major medical insurance, including living expenses such as mortgage and other necessary payments. It also delivers fast and reliable coverage not provided through workers compensation of Social Security Disability.
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ERISA Claims Accrues With First Clear Underpayment.
Benefits Magazine; v51 no7 p 64 Jul 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The plaintiff in Riley v. Metropolitan Life Insurance Company worked for the defendant until debilitated by pain and depression. After receiving short-term disability benefits, he returned to work in a power paying position, then left again and was awarded long-term benefits, calculated relative to the lower salary. The plaintiff disputed the calculation, brought a state suit two years later and finally sued under ERISA seven years after first receiving the benefits in question. The court agreed with the defendant that the suit was time barred and was upheld by the First Circuit Court of Appeals, using Massachusetts' six-year statute of limitations. While the plaintiff asserted each benefit payment restarted the limitations period, the appeals court held the claim accrues on the date of receipt or notice of the first underpayment, siding with three other circuit courts.
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10 Valuable Tips for FMLA, ADA Compliance.
Leave and Disability Coordination Handbook; v17 no4 pp 2, 16 Jun 2014; journal article

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Abstract : A variety of court cases and DOL claims of interference with benefits or retaliation highlight important details for compliance with the Family and Medical Leave Act and the Americans with Disabilities Act. Employers may not seek a health care provider's opinion on an employee's fitness to return to duty until the individual has resumed work. An employee may agree not to pursue retrospective interference or retaliation claims through a signed severance contract. Employers should have clear criteria for choosing individuals and positions affected by a workforce reduction. FMLA protections cover employees caring for seriously ill family members. Notices of disability-related termination of employment should be unequivocal. Employees returning from FMLA leave are entitled to an equivalent job, if not the job they left. Additional tips pertain to protected leave, requirements to take FMLA leave, physician's notes for intermittent absences and extensions of leave as reasonable accommodation.
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Can an Employer Require 'Job Readiness' in a Return-to-Work Form?
Susser, Peter A.; Leave and Disability Coordination Handbook; v17 no4 pp 1, 6-7 Jun 2014; journal article

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Abstract : Employers may require medical documentation showing an employee ending a medical leave is ready to return to work but must be mindful of differing requirements of the Family and Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA). The FMLA requires employers to notify employees at the start of leave about any required fitness for duty examination, though it applies only to the condition prompting the leave and must be applied uniformly. Employers may not mandate a second opinion but may seek clarification from the employee's physician with the employee's consent. The ADA allows a return-to-work exam by a physician of the employer's choice. An employer is not required to reinstate the employee in the same or equivalent position if it would cause undue hardship for the company. The employer may provide for an examination to judge whether the employee's condition poses a direct risk to personal safety, in view of a formal job description, and then consider reasonable accommodations or other actions.
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Court Affirms the Denial of Short-Term Disability Benefits.
Benefits Magazine; v51 no6 pp 57, 59 Jun 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In Fite v. Bayer Corporation et al. the plaintiff was diagnosed with major depressive disorder and was granted short-term disability (STD) benefits for up to 26 weeks. The plan's third-party administrator (TPA) extended the benefits within the time limit but reversed when it did not receive satisfactory medical evidence of disability. The plaintiff submitted additional evidence which was reviewed by the TPA's independent psychiatrist, leading the TPA to uphold the denial for lack of evidence of functional impairment. The plaintiff submitted more evidence when appealing to the defendant ERISA committee, leading to consultation with a third independent psychiatrist and an examination by a fourth, who found inadequately documented disability and attributed it to the plaintiff's employment. This point was key since employment-related mental conditions were excluded from STD plan coverage. The district court granted summary judgment for the defendants and was upheld by the Tenth Circuit Appeals Court. The plaintiff had stated her condition was a result of her job, the plan language was clear and her claim had been given a full and fair review.
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Court Finds Claims Time-Barred and Preempted Under ERISA.
Benefits Magazine; v51 no6 p 64 Jun 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The plaintiff in Costa v. Astoria Federal Savings and Loan Association et al. alleged she became totally disabled in 2003 and unable to work. She filed for and was awarded Social Security disability benefits and requested disability pension benefits from her employee welfare benefits plan. She asserted her requests to the benefit plan were denied and that she was told she was not entitled to benefits until age 55. In her suit she stated she was entitled to benefits and a declaratory judgment on her rights to future benefits and that the defendants violated ERISA in denying her benefits and breached their fiduciary duty. Since the legal action started in 2013, over seven years after the clear denial of benefits in 2005, the court ruled all claims are time-barred. The court also ruled that ERISA preempts the state law causes of action and dismissed the entire complaint with prejudice.
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Court Finds No Specific Intent to Interfere With ERISA Benefits.
Benefits Magazine; v51 no6 p 59 Jun 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : An individual who filed for short-term disability benefits two weeks after being terminated from employment was found ineligible for benefits and unable to show the employer's intent to interfere with her benefits under ERISA, the Family and Medical Leave Act and disability discrimination laws. The plaintiff in Barnhardt v. Open Harvest Cooperative asserted the defendant employer knew she would apply for disability benefits during a medical leave and terminated her employment to block her claim. The district court ruled for the defendant. The Eighth Circuit Court of Appeals noted the plaintiff must prove a defendant's specific intent to interfere with an employee's ERISA benefits to win an ERISA Section 510 interfere claim. The plaintiff was unable to show direct evidence of such intent, nor that the employer's failure to pass through a premium payment indirectly reflected specific intent to interfere, nor that she was terminated in order to interfere with her rights. The Eighth Circuit upheld the district court's summary judgment for the defendant.
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Other Recent Decisions.
Benefits Magazine; v51 no6 pp 66-69 Jun 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In The American Medical Association v. Connecticut General Life Insurance Company the Eleventh Circuit Court of Appeals upheld the district court's dismissal of the case. The plaintiffs had complained that the defendant improperly distributed reimbursement payments for out-of-network health care services, but the claims had already been released through previous settlement agreements. The district court had discretion to dismiss and an appeal would violate that court's order. In Garrett v. Principal Life Insurance Company the Tenth Circuit upheld the lower court's decision to reverse the defendant insurance company's denial of benefits. After the plaintiff received inpatient substance abuse treatment, the defendant first denied coverage for a noncovered facility and then stated inpatient treatment was not covered at all. The defendant contested the court's award of full costs to the plaintiff, but the court rejected any new arguments about costs or calculations not present in the administrative record. In Melamed v. Blue Cross of California and Anthem Blue Cross Life and Health Insurance Company the Ninth Circuit affirmed the lower court's judgment in dismissing the plaintiff's case with prejudice. The plaintiff alleged he was underpaid by the defendant company for health services delivered as an out-of-network provider. Preempted by ERISA, the case was dismissed with prejudice under the two dismissal rule of the Federal Rules of Civil Procedure Rule 41, since the plaintiff had voluntarily dismissed other substantially similar claims. In Salz v. Standard Insurance Co. the Ninth Circuit reversed the district court's decision to deny long-term disability benefits. The plaintiff was injured on the job and was granted Social Security benefits. The appeals court found the lower court erred by permitting an overly narrow consideration of job performance requirements and definition of sedentary, and further noted the potential conflict of interest in the defendant's dual role as plan funder and administrator. In Central States, Southeast and Southwest Areas Pension Fund v. Wingra Stone Company, the plaintiff multiemployer pension fund sought compensation for years of defendant contributions at a rate governed by an outdated and nonspecific contract addendum. The defendant continued payments to meet its contribution obligations despite questions as to the amount. The Seventh Circuit Appeals Court found the lower court erred by not looking at the defendant's contribution history in light of amended contracts. The court found summary judgment inappropriate and vacated and remanded the case to examine the contract negotiating history.
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Time to Tackle Telecommuting.
Hyman, Joe; Workforce; v93 no6 p 20 Jun 2014; journal article

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Abstract : Yahoo's 2013 ban on telecommuting was roundly criticized, and in 2014 a federal appeals court recognized that technology advances support telecommuting as a reasonable accommodation for disabled workers. The limited scope of that recognition is likely to expand as working at home becomes more feasible. Employers who want to prohibit work at home should have a solid defense based on job descriptions, cost of managing a telecommuting program and alternative accommodations for the disabled. Tracking hours to comply with the Fair Labor Standards Act and making accommodations for the Americans with Disabilities Act can be a challenge. Those employing telecommuters should clearly communicate the work hours, require employees to carefully track their time and oversee the work product. Overall, the benefits of permitting telecommuting outweigh disadvantages.
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Court Affirms Denial of Disability Benefits.
Benefits Magazine; v51 no5 pp 53, 55 May 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Following a back injury, an employee was granted 24 months of benefits under a long-term disability plan, but continuing coverage required total and continuous inability to work in any occupation. Reports from the employee's health care providers supported her light duty, sedentary, part-time work. The claims administrator considered these reports and additional medical evidence and found the employee did not meet the plan's definition of disabled and terminated benefits. In McClain v. Eaton Corporation Disability Plan, the district court granted summary judgment for the defendant plan and administrator. The Sixth Circuit Appeals Court upheld the denial of benefits, finding the defendant gave due consideration to the treating physician's reports, followed the terms of the plan and ultimately came to its conclusion using a deliberate and principled reasoning process.
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Disability Income Insurance: What Type of Coverage Is Best for Employees?
Schneider, Larry; Benefits Magazine; v51 no5 pp 44-47 May 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Group or association long-term disability (LTD) plans are relatively low cost and are better than no disability coverage at all, but employers should be aware of their drawbacks. Group LTD plans involve less underwriting than individual policies, and coverage may be guaranteed. But group policies are likely to have stricter definitions, terms and conditions, such as considering one's own occupation or covering mental and nervous conditions for only two years. Unlike individual plans, group policies are neither portable nor renewable, and carriers can increase their rates at any time. Group policies typically cover 60 to 70 percent of wages to a maximum of $5,000 and do not cover bonuses, details that can discriminate against highly paid employees. Payable amounts are offset by other types of income. Considering the disadvantages, many employers may be better off providing individual plans for employees.
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Other Recent Decisions.
Benefits Magazine; v51 no5 pp 68-69 May 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In Melech v. Life Insurance Co. of North America the Eleventh Circuit Court of Appeals ruled the plan administrator had a responsibility to consider the full record of the plaintiff's claim for long-term disability benefits, including the required application and approval for Social Security Disability Insurance benefits. The court found the process internally inconsistent and procedurally unfair, reversing the lower court and remanding the case for the administrator's further consideration. In Nugent v. Aetna Life Insurance Co. the Fifth Circuit found no error in a plan administrator's termination of long-term disability (LTD) benefits after the plaintiff and plan participant's cancer went into remission. That the plaintiff was approved for Social Security Disability Insurance did not affect the LTD determination, especially since the plan administrator's determination was based on more recent medical information. In Colvin v. United Flooring, Inc. the district court for Northern Indiana ruled the statute of limitations for paying delinquent contributions to a multiemployer pension plan started when the plaintiff plan discovered unpaid contributions through an audit, not, as the defendant contended, when it failed to make the contributions.
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100% Healed Return-to-Work Policy May Be Unlawful 'Qualification Standard'.
Thompson's ADA Compliance Guide; v25 no4 pp 1-2, 5 Apr 2014; journal article

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Abstract : The district court for the Northern District of Illinois will hear claims under the Americans with Disabilities Act (ADA). The Equal Employment Opportunity Commission (EEOC) filed on behalf of class of disabled employees of UPS, Inc., Trudi Momsen in particular. Ms. Momsen, an administrative assistant, took a 12-month leave for symptoms diagnosed as multiple sclerosis. After an additional two weeks leave she was fired for exceeding the company's 12-month leave policy. Finding the company failed to engage in an interactive process to assess this employee's and others' work potential and to accommodate their disabilities, the EEOC sought back pay and compensatory and punitive damages. The Seventh Circuit Appeals Court has held that a 100-percent healed policy automatically discriminates against disabled workers who are qualified to work. The Illinois court rejected UPS's framing its rule as an attendance policy and instead considered it a medical qualification standard but not reflecting an essential job-related function.
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Is Indefinite Leave a Reasonable Accommodation?
Minehan, Maureen; Employment Law Counselor; no284 pp 3-4 Apr 2014; journal article

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Abstract : While employers may be tempted to fire workers who appear to be indefinitely extending their leave under the Americans with Disabilities Act (ADA), they should ensure they have exhausted all reasonable accommodation options before proceeding. In general, indefinite leave is not a reasonable accommodation under the ADA, as it imposes undue hardship on the employer. However, state laws may be less clear. When an employee's return date is uncertain or continually pushed back, employers should find out why. Knowing the reasons for the delay allows employers to work with employees and doctors to accommodate the employee and speed his or her return to work. Employers should also examine the business circumstances to determine if extending the leave is in fact an undue hardship.
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Plaintiff May Proceed With Retaliatory Discharge Claim.
Benefits Magazine; v51 no4 pp 65-66 Apr 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In Parker v. Cooper Tire & Rubber Co., the plaintiff's hospitalization for flu symptoms progressed to a need for a liver replacement. The plaintiff reported some but not all associated absences and a physician's note indicated he was at least temporarily totally disabled, but he was fired for failing to report three absences. The plaintiff alleged he was dismissed to avoid paying disability and medical claims. The district court found the defendant showed no specific intent to interfere with short- or long-term disability (LTD) benefits but the court failed to address medical benefits. Considering the case under ERISA Section 510, the Fifth Circuit Appeals Court noted the plaintiff had not applied for LTD benefits and that the short-term disability plan was not an ERISA plan. However, the court found the timing of the plaintiff's dismissal suspicious and that the defendant's reasoning for the dismissal was pretextual to avoid paying medical costs.
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Plan Administrator Failed to Provide Notice of Appeal Rights.
Benefits Magazine; v51 no4 pp 69-70 Apr 2014; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The federal court for the District of Alaska ruled for the plaintiff in Herrell v. Locals 302 and 612 of the International Union of Operating Engineers-Employers Construction Industry Retirement Fund on the question of notice of right to appeal a benefit decision. The plaintiff sought disability benefits for chronic pain in 2009 and heard through his union about upcoming disability benefit reduction to start in 2010. He received, completed and submitted a retirement disability form but had to resubmit since the administrator claimed not to have received it. Over a year later the claim was denied, prompting an appeal which was approved. An explanation of benefits showed the monthly benefit to be one fourth of what the plaintiff expected, prompting legal action seeking benefits under the plan terms prior to 2010. The court found the defendant failed to provide notice of appeal rights with the questionable explanation of benefits and remanded the case to the plan trustees.
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Firms Link Wellness to Disability Benefits.
Harrison, Sheena; Business Insurance; v48 no6 p 8 Mar 17, 2014; journal article

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Abstract : Some innovative employers are tying long-term disability benefits with wellness and health coaching to control premium costs and promote employees' quicker return to work. Mercer L.L.C.'s group benefits practice leader Rich Fuerstenberg notes a rise in employer interest in ways to get more leverage from wellness benefits, such as by basing disability payments on working with a health coach or requiring health risk assessments or participation in disease management programs. Integration of health programs, disability leave and workers compensation is gaining momentum, with added steam from the Affordable Care Act's focus on prevention and accountability. Most employers continue to provide disability benefits, with about 80 percent paying the full short- and long-term disability premium for salaried workers and about 75 percent for hourly workers. Some employers are trimming contributions but let employees contribute for additional coverage.
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Managing Workplace Substance Abuse.
Calo, Dena B.; Dugan, Kathryn E.; Leave & Disability Coordination Handbook; v17 no3 pp 1, 4-5 Mar 2014; misc. publication

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Abstract : Employers must be mindful of rights and limits under the Americans with Disabilities Act (ADA) and Family and Medical Leave Act (FMLA) when dealing with an employee who is alcoholic or using illegal drugs. Alcoholics are entitled to ADA and FMLA protection, but not if they drink while on the job. The case of Equal Employment Opportunity Commission v. Old Dominion Freight Line Inc. determined that an employer may not establish a policy prohibiting alcoholics from returning to work after rehabilitation. There is no protection for Illegal drug use at work, and drug testing is permitted. An employee who has started or completed drug abuse treatment is entitled to reinstatement with certification of ability to return to work, as shown in Clark v. Jackson Hospital & Clinic, Inc. Employers should avoid blanket policies about prior substance abuse and assess each situation individually, going through an interactive process to determine appropriate and reasonable accommodation.
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No More Half Measures: A Case-Based Approach for Addressing FMLA Abuse.
Connell, Dana S.; Employee Relations Law Journal; v39 no4 pp 3-23 Spring 2014; journal article

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Abstract : Employers struggle to find ways to effectively address employee abuse of rights under the Family and Medical Leave Act (FMLA), and solutions provided in the law fall short. Most FMLA abuse in case law stems from an employee's working a second job on the side whether or not there is a written policy prohibiting it, engaging in manual labor, running errands, engaging in social or recreational activities, taking a pleasure trip or failing to care for a family member during care-related leave. Courts generally support investigations when the employer has an honest belief the employee is engaging in any of these situations and typically grant summary judgment with evidence. Case law shows the value of clear leave policies, recognize surveillance and other methods of gathering evidence of abuse and support employers' investigations of suspicious employee behavior patterns.
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