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Leave Use Bottom Line — Save Money, Time and Productivity

This week we’re blogging about audits again. But we can assure you that it won’t be that painful. And we’ll provide you with guidance on how to save money, time and productivity.

One of the first steps to getting a handle on employee absence is investigating what leave types are most commonly used in your company. Why, you ask? Because isolating the most frequently used leave types provides valuable case information — and ultimately, an analytical assessment of leave benefit utilization will uncover opportunities to save money, time and productivity.

And we all want that, right?

Understand Overall and Average Leave Usage Trends Many companies are not aware of the reasons for employee absence, let alone knowing how many employees are absent on any given day. Using a leave management system is one way to not only improve compliance and tracking but to begin to understand which leave types are most commonly utilized by your workforce.

This information can quickly be displayed by running reports with your data. So if you’re in the market for a leave management system, you should look for a system that has reports that offer this type of information. Examples include:

  • Accommodations Report — Allows the leave specialist to see which leave types are most commonly occurring with the part of the workforce that requires an accommodation. For example, are these types of situations more associated with one particular leave state or specific accommodation request types?
  • Case Status Detail — Provides insight into whether company, state or federal leave types are more commonly used.
  • Maximum Duration — Details which employees on leave are approaching the maximum duration of that particular leave.
  • Case Load Report — (An HR favorite!) Provides managers with information about open cases and those that are expected to close in the near future. This helps managers monitor the caseload of the leave specialists to make sure they aren’t overburdened.
  • Overdue Task Report — (Not an HR favorite!) Provides a quick snapshot into all tasks that are overdue. In conjunction with the Case Load Report, this information increases the manager’s ability to make sure that absences in their workforce are being effectively tracked and processed.

Save Money, Time and Productivity Once we’ve got a handle on our leave usage and trends, it’s important to proactively manage FMLA claims and try to minimize the likelihood that these claims will progress to paid benefits, such as Short-term Disability (STD), Long-term Disability (LTD) or Workers’ Compensation (WC).

In one of our customer studies, we compared an individual employer to a reference group. The study indicated that while the employer experienced a similar 10 percent progression rate from FMLA to these paid benefits, narrowing the focus to just intermittent FMLA revealed the employer’s progression rate was 4.5 percent better.

Projected savings from these FMLA absences not advancing to STD, LTD or WC was approximately $500,000.

Additional savings can be experienced even if FMLA absences do progress to STD, LTD or WC. Over a recent four-year period, while one company’s STD durations increased by 8.3 percent, from 49.2 to 53.3 days, this increase was lower than that experienced by the reference population, which experienced an increase of 14 percent, from 61.5 to 70.1 days. Similar savings can be experienced with both LTD and WC benefits, with a total absence management program based on an integrated point of view. Insight into this integrated view of an employee’s absence can be achieved with a leave management system.

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So it’s clear that the cost of investing in a leave management system is small when compared with the potential cost savings. LeaveXpert returns an average of 5.5 full-time employees (FTEs) per 1,000 employees to the workforce on an annual basis who would not have otherwise been working. This return of employees is associated with increased productivity and cost savings. The typical return on investment (ROI) associated with LeaveXpert ranges from $2.85 to $5 for every dollar invested.

We know that’s a lot of information to take in, but the bottom line is that a leave management system will save you money, time and productivity. So let’s get you started today!