Before You Fire Someone for FMLA Paperwork Problems, Make Sure Your System Worked

Key Takeaways

• Broken TPA system can constitute FMLA interference.
• Employers must investigate before terminating FMLA‑related attendance issues.
• Supervisor assurances during transitions create legal exposure.
• HR must document employee discussions about alleged discrepancies.
• Testing and auditing TPA processes is essential compliance step.

Pulse Analysis

The recent Wisconsin decision spotlights a growing tension between employers and third‑party administrators (TPAs) of Family and Medical Leave Act (FMLA) paperwork. While many companies outsource leave management to reduce administrative burden, the case illustrates that a malfunctioning TPA—characterized by a phone system that hangs up at the end of the day and a non‑functional website—can itself become a legal liability. Courts are increasingly willing to view such systemic barriers as interference, even when the employer never explicitly denies leave. This shift signals that the mere existence of a burdensome process may satisfy the interference element under the FMLA.

Legal analysts note that the court’s refusal to grant summary judgment on retaliation grounds hinges on the direct link between the employee’s FMLA usage and the employer’s termination rationale. The employer cited excessive absenteeism and dishonest reporting, but those allegations stemmed from the employee’s attempts to record FMLA‑protected absences through a defective system. By failing to engage the employee in a pre‑termination investigation, the employer opened the door to a retaliation claim. The ruling reinforces the principle that employers must treat any FMLA‑related attendance issue with the same procedural safeguards afforded to other disciplinary actions.

For HR leaders, the practical takeaway is clear: outsourcing does not outsource responsibility. Companies should audit TPA performance before and after transition, conduct regular usability tests, and ensure that managers are trained on what they can promise employees about leave status. Documenting every conversation about alleged discrepancies and providing a clear, accessible reporting channel are essential steps to mitigate risk. As more firms turn to external vendors for compliance functions, this case serves as a cautionary tale that robust internal oversight remains non‑negotiable.