2009-27141 ResoRESOLUTION NO. 2009-27141
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE CITY TO
ENTER INTO AN AGREEMENT WITH UNUM, FOR THE
ADMINISTRATION OF THE CITY'S FAMILY AND MEDICAL LEAVE
PROGRAM, COMMENCING ON JANUARY 1, 2010, AND ENDING ON
DECEMBER 31, 2013, FOR A NOT TO EXCEED FEE OF $38,000 FOR
THE FIRST AND SECOND YEARS; A LONG-TERM DISABILITY
POLICY FOR THE PARTICIPANTS IN THE CITY'S 401(a) DEFINED
CONTRIBUTION PENSION PLAN, FOR A NOT TO EXCEED FEE OF
$9,950 FOR THE FIRST AND SECOND YEARS; AND SHORT-TERM
DISABILITY AND LONG-TERM DISABILITY POLICIES, FULLY
FUNDED BY EMPLOYEE CONTRIBTUTIONS, FOR A THREE YEAR
PERIOD, ALL PURSUANT TO THE REQUEST FOR PROPOSALS
ISSUED BY GALLAGHER BENEFITS SERVICES, THE CITY'S
CONSULTANT OF RECORD.
WHEREAS, as required by the U.S. Department of Labor, the City's Family
Medical Leave (FML) policy provides employees the opportunity for up to twenty-six (26)
weeks of unpaid leave for the care of a family member; and
WHEREAS, the City's policy is administered by members of the Human
Resources Compensation Division and Department Payroll Coordinators; and
WHEREAS, certification of the employee's application for the medical necessity
for the FML is provided through the City's agreement with Mount Sinai; and
WHEREAS, while the Administration has done well in the administration of FML,
the Administration is aware of the complexities of the U. S. Department of Labor's
rulings; and
WHEREAS, Unum can provide expert management of the City's FML policy;
including medical certification and day to day management of FML; and
WHEREAS, the City provides along-term disability plan for the fifty (50) current
participants in the City's Defined Contribution Retirement Plan (401(a)); and
WHEREAS, the Defined Contribution Retirement Plan (401(a)) includes a long-
term disability benefit with the annual premium cost paid by the City, to mirror the long-
term disability benefit provided by the Miami Beach Employees' Retirement Plan; and
WHEREAS, the annual premium cost to the City to continue this coverage under
the proposed Unum long-term is equal to the City's current annual cost; and
WHEREAS, the opportunity to purchase short and long term disability offers
employees the opportunity to purchase some salary protection should they be unable to
work for an extended period of time; and
WHEREAS, the short-term and long-term disability benefit would be a voluntary
benefit made available to the employees, and would be paid fully by the employees; and
WHEREAS, based on the responses to the RFP, the short-term and long-term
disability plans proposed by Unum provide employees with the best value; and
APPROVED AS TO
FORM & LANGUAGE
WHEREAS, after evaluating the respondents, Gallagher recommends the
administration of the City's FML policy, the long-term disability policy for the City's 401(a)
participants, and employee funded short-term and long-term disability plans be awarded
to Unum, based on the value of the benefit provided and the cost; and
WHEREAS, the City Manager has reviewed the recommendations of Gallagher
and recommends accepting the recommendation, awarding the administration of the
City's Family Medical Leave policy; long-term disability policy for participants in the
Defined Contribution Retirement Plan (401(a); and an agreement for a voluntary short
and long term disability plan to Unum.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby authorize the City to enter into an agreement with Unum, for the
administration of the City's Family and Medical Leave program, commencing on January
1, 2010, and ending on December 31, 2013, for a not to exceed fee of $38,000 for the
first and second years; along-term disability policy for the participants in the City's 401(a)
Defined Contribution Pension Plan, for a not to exceed fee of $9,950 for the first and
second years; and short-term disability and long-term disability policies, fully funded by
employee contributions, for a three year period, all pursuant to the Request for
Proposals issued by Gallagher Benefits Services, the City's consultant of record.
PASSED and ADOPTED this 15th day of July , 2009.
MA
Mattie Herrera Bower
TTEST:
~ ati C~
CITY CLERK
Robert Parcher
T:\AGENDA\2009Wu1y 15\Regular\Disability and FML
t~ FO ELUTION
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7 14 Qq
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Resolution.d
'" ity ttorne Date
COMMISSION ITEM SUMMARY
Condensed Title:
A Resolution of the City to enter into an agreement with Unum for the administration of the City's Family and Medical
Leave (FML) program, along-Term Disability policy for Defined Contribution Retirement Plan (401(a)) participants and
a Short-Term Disability and Long-Term Disability policy fully-funded by the employee.
Intended outcome 5u
• Attract and maintain a quality workforce.
• Ensure ex enditure trends are sustainable over the Ion term.
Supporting Data (Surveys, Environmental Scan, etc.):
I. 2007 Internal Support Functions Survey
• Overall satisfaction of benefits administration was rated 75.6% as excellent or good combined
II. 2008 Environmental Scan
• Motivated and Skilled Workforce turnover rates = 13.86% for 2007 vs. 10.7% for 2006
Issue:
Should the City contract with Unum for the administration of the City's Family Medical Leave (FML) program and a new
voluntary short-term and long-term disability insurance program?
item summarvircecommenaation:
At the direction of the City's Administration, Gallagher Benefits Services issued RFP No. 10-2589 requesting
proposals for a new voluntary short and long term disability benefit fully-funded by employee contribution. Offering
employees the opportunity to purchase short and long term disability provides employees some salary protection
should they be unable to work for an extended period of time. As a result of the City's voluntary short-term and long-
termdisability RFP process, the Administration was made aware of the availability of expert management services of
the Family Medical Leave (FML) Act which would follow consistent interpretations of the U.S. Federal Government
regulations.
Following their review of the RFP responses, Gallagher Benefits Services recommends the employee funded voluntary
short-tern and long-term disability program and the administration of the City's Family and Medical Leave policy be
administered by Unum.
Adviso Board Recommendation:
N/A
Financial Information:
___
Source of Amount Account
Funds: 1 $38,000 (not to exceed) 560-1793-000322 Administrative Fees for Active
Employees for the administration of Family Medical
Leave
2 $9,950 (not to exceed) 601.7000.229327 Premium for long-term disability
coverage for the participants of the Defined
Contribution Retirement Plan 401 a
OBPI Total $47,950 (not to exceed)
Financial Impact Summary:
The City would not incur a cost impact offering a voluntary short-term and long-term disabilty benefit to its employees
since these benefits are voluntary with the full cost of the plan paid by the employee through payroll contributions. For
those fifty (50) remaining employees in the Defined Contribution Retirement Plan (401(a)), the City will need to
continue the long-term disability. The annual proposed premium cost to the City $9,950, equal to the plan's current
annual cost. This change in long-term disability plan vendors is cost neutral to the City.
The City's FML policy is administered and processed by staff in Human Resources Department and the Payroll
Coordinators in each department. Medical certification of the application is provided through the City's agreement
with Mount Sinai Medical Center. For each application reviewed by Mount Sinai Medical Center, the City is charged
fifteen dollars ($15). In the 2008 calendar year, Mount Sinai Medical Center reviewed seventy-eight (78) FML
applications, for a total cost of $1,170. While the Administration is aware this is a much lower cost than the project
annual administrative fee of $38,000, by contracting this service out, the need for staff to process the employee
application is eliminated, therefore resulting in created efficiencies in the Human Resources Department as well as
departments throughout the City.
\.rll VI@fR 5 ViTIG@ Le ISlailve 1 raCKln
Sue Radig, Human Resources Administrator I
Sian-Offs: ,
DepartmenfDirector Assistant City Manager City Manager
Ramiro Inguanzo,
Human Resources Director
~~ l Y t ~ ~ ~~~ AGE#+IDfI iTEM -O
DATE 7'~ S
m MIAMIBEACH
City of Miami Beath, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachA.gov
COMMISSION MEMORANDUM
TO: Mayor Matti Herrera Bower and Members of the City Co mission
FROM: Jorge M. Gonzalez, City Manager
DATE: July 15, 2009
SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, AUTHORIZING THE CITY TO ENTER INTO AN AGREEMENT WITH
UNUM, FOR THE ADMINISTRATION OF THE CITY'S FAMILY AND MEDICAL LEAVE
PROGRAM WITH A NOT TO EXCEED FEE OF $38,000 FOR THE FIRST AND SECOND
YEARS, ALONG-TERM DISABILITY POLICY FOR THE PARTICIPANTS IN THE CITY'S
401(a) DEFINED CONTRIBUTION PENSION PLAN WITH A NOT TO EXCEED FEE OF
$9,950 FOR THE FIRST AND SECOND YEARS, AND SHORT-TERM DISABILITY AND
LONG-TERM DISABILITY POLICIES FULLY FUNDED BY EMPLOYEE
CONTRIBTUTIONS, FOR A THREE YEAR PERIOD, PURSUANT TO THE REQUEST
FOR PROPOSALS ISSUED BY GALLAGHER BENEFITS SERVICES, THE CITY'S
CONSULTANT OF RECORD.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution.
ANALYSIS
The City currently provides employees the opportunity to elect coverage to protect their
heath and life, however, no coverage option is made available to employees to protect their
income should they become unable to work due to an illness or injury. In order to provide
employees with the opportunity to purchase voluntary disability coverage, the Administration
worked with Gallagher Benefits Services (Gallagher), the City's consultant of record, to issue
a Request for Proposals (RFP) for a voluntary group short-term and long-term disability plan
funded fully by employee contributions, with no contribution being made toward the coverage
by the City.
Employees are not provided the opportunity to purchase short-term and long-term disability
coverage. The Administration requested Gallagher Benefits Services (Gallagher) issue an
RFP for voluntary short-term and long-term disability plans fully funded by the employees.
Currently, employees who are not vested in the Miami Beach Employees' Retirement Plan
are not provided salary protection should they be unable to work. For an employee to
receive a disability benefit from the Miami Beach Employees' Retirement Plan, the employee
must be fully vested in the plan. With the plan's current five (5) year vesting provision, a
number of City employees would not be eligible for a disability benefit from the pension plan.
In addition, the disability benefit provided by Social Security is not available to an individual
who has not contributed to Social Security in the twenty four (24) months prior to the date of
their disability. As City employees do not contribute to Social Security, an individual who has
July 15, 2009 City Commission Meeting
Selection of a Voluntary Group Disability Policy and a Family Medial Leave Administrator
Page 2 of 5
been employed by the City for a period of twenty-four (24) months or more may not be
eligible for any Social Security disability benefits. Offering employees the opportunity to
purchase voluntary short-term and long-term disability coverage provides a protection should
they be unable to work for an extended period of time due to an illness or accidental injury
not related to their employment.
Short-term disabilty provides an employee a percentage of their earnings for a maximum
period of twenty-six (26) weeks due to a non-work related illness or injury. The cost of the
coverage is based on the employee's earnings prior to their disability and the percentage of
coverage purchased. While collecting short-term disability benefits the employee's medical
condition is monitored by the plan to encourage an expedited return to work.
Long-term disability provides the employee a percentage of their earnings after their first
twenty-six (26) weeks of disability due to a non-work related illness or injury. Coverage
under the plan is provided until the employee is able to return to work, is approved by Social
Security for Disability Benefits (if eligible) or dies. In addition, the long-term disability plan
provides training and job placement opportunities should the individual be unable to perform
the duties of the job held prior to their illness or injury. The cost of the coverage is based on
the employee's earnings and the percentage of coverage purchased.
In response to the RFP, the following four (4) vendors responded with bids to provide a
group voluntary short-term and long-term disability plan to the employees of the City:
• Lincoln Financial
• The Hartford
• The Standard
• Unum
The response from The Standard did not include premium costs and was not considered.
The following is a summary of the premium rates and rate guarantees of the three (3)
proposals:
Plan Administrator Short-Term
Disability Rate
er $100 Short-Term
Disability
Rate Guarantee Long-Term
Disability Rate
er $100 Long-Term
Disability
Rate Guarantee
Lincoln Financial $.29 One 1 ear $.36 One 1 ear
The Hartford $.57 One 1 ear $.36 One 1 ear
Unum $.33 Two 2 ear $.50 One 1 ear
After thoroughly evaluating the respondents, Gallagher Benefit Services determined the
plans provide by Unum (Attachment A) provided the best benefit value at a cost affordable to
the employees and recommends the City award an agreement for a voluntary short and long
term disability plan, fully funded by employee contributions, to Unum based on the following
supporting factors:
• Unum provided the best continuity of coverage with a seamless transition of benefits
from short-term disability to long-term disability
• Same definition of disability under both the short-term disability program and long-
term disability program
July 15, 2009 City Commission Meeting
Selection of a Voluntary Group Qisability Policy and a Family Medial Leave Administrator
Page 3 of 5
• Transitioning to a long-term does not require additional certifications from the
participants treating physicians as the participants treatment information is
communicated between plans as necessary
• Family Medical Leave (FML) administration provided for any employee approved for
short-term disability at no cost
In addition to a voluntary long-term disability offering, the City requested proposals for a
long-term disability plan for the fifty (50) current participants in the City's Defined
Contribution Retirement Plan (401(a)). These employees were hired prior to the March 18,
2006 change in the City's pension benefits terminating the defined contribution plan (401(a))
and elected to continue their pension benefit through the plan. Included in the Defined
Contribution Retirement Plan (401(a)) is a long-term disability benefit with the annual
premium cost paid by the City. This long-term disability benefit is provided to these plan
participants to mirror the long-term disability benefit provided by the Miami Beach
Employees' Retirement Plan. The annual premium cost to the City to continue this coverage
under the proposed Unum long-term disabilty plan is $9,894, equal to the current annual
City's current cost. This City provided long-term disability coverage ends when the plan
participant terminates or retires. This change in plan vendors is cost neutral to the City.
Included with their response for the short-term and long-term disability plan, Unum provided
information regarding availability of their management services for the City's Family Medical
Leave (FML) Act for all employees. As required by the U.S. Federal Government,
Department of Labor the City's Family Medical Leave (FML) policy provides employees the
opportunity for up to twelve (12) weeks of unpaid leave for their own care or the care of a
family member due to a medical need. The leave can be taken all at once, or intermittently.
In addition, the City has enhanced the FML policy to include an additional twelve (12) week
period of FML, if deemed medically necessary. Additionally, recent enhancements made to
the Family Medical Leave Act provides leaves for employees who have family members in
the military called to active duty or to care for a covered service member recovering from a
serious injury or illness incurred in the line of duty.
Unum has indicated their ability to provide management of the City's FML policy. This
management would include medical certification and day-to-day administration of the City's
current FML policy, providing protections from misinterpretation of the FML Act and its
current and future changes, and convenience to the employee with one (1) point of contact
for all their FML application, questions, and certifications. In addition, Unum representatives
maintain constant contact with the individual's treating physician to guarantee the employee
is returned to work as quickly as possible. The Administration believes expert management
of the FML policy to be valuable service to the City and its employees. Unum would be able
to provide the employee a one (1) point of contact for the administration of the policy,
constant contact with the treating physician to guarantee the employee compliance and
expedited return to work and compliance with atl federally mandated changes in the
program.
Management of FML by Unum would create a cost impact to the City. However, the
Administration believes the management provided by Unum could create overall cost
savings due to close adherence to the FML regulations and the close medical monitoring
and the employee's expedited return to work. Unum has also provided the City with a copy
of their projected return on investment for their proposed administration of the City's FML
Policy (Attachment B).
July 15, 2009 City Commission Meeting
Selection of a Voluntary Group Disability Policy and a Family Medial Leave Administrator
Page 4 of 5
While the City has done well in the administration of FML in the past, the Administration is
aware of the complexities of the FML rulings and the recent additions to eligible leave types
have brought to the policy. While these changes in the policy provide job protections to the
employee and grant them more unpaid leave, the City is left vulnerable to their own
individual interpretation of the act itself. The Administration feels the day-to-day
management of the policy exposes the City to penalties and fines related to errors in the
interpretation of the FML regulations.
Should the City make the decision to have Unum manage its FML policy, FML management
would be coordinated with the management of the short-term disability plan, providing the
employee one (1) point of contact for both their FML applications and short-term disability
benefit.
FINANCIAL IMPACT
The City would not incur a cost impact offering a voluntary short-term and long-term disabilty
benefit to its employees. Both the short-term and long-term disability benefits are voluntary
with the full cost of the plan paid by the employee through payroll contributions.
For those fifty (50) remaining employees in the Defined Contribution Retirement Plan
(401(a)), the City will need to continue the long-term disability coverage included in this
pension benefit. The annual premium cost to the City to continue this coverage under the
proposed Unum long-term disabilty plan is $9,894, equal to the plan's current annual cost.
This change in long-term disability plan vendors is cost neutral to the City.
Currently the City's FML policy is administered by staff in Human Resources Department
and the Payroll Coordinators in each department. Medical certification of the application
(when required) is provided through the City's agreement with Mount Sinai Medical Center.
For each application reviewed by Mount Sinai Medical Center the City is charged fifteen
dollars ($15). In the 2008 calendaryear, Mount Sinai Medical Center reviewed seventy-eight
(78) of the City's one hundred forty-six (146) FML applications, for a total cost of $1,170.
The per employee per month charge by Unum is $1.45 based on the number of current
employees the annual cost would be approximately, but not to exceed, $38,000. While the
Administration is aware this is a much lower cost than the project annual administrative fee
of $38,000, it is believed that the expert management of this federally mandated leave may
result in the employee's expedited return to work and reduced exposure to potential fines
and penalties from the U.S. Federal Government.
FML processing time is dependent on the application being complete with the correct
medical contact information and the cooperation of both the individual's treating physician
and the employee. By contracting this service out, it eliminates the need for staff to process
the employee application, therefore resulting in created efficiencies in the Human Resources
Department as well as departments throughout the City. With this in mind, a vacant position
in Human Resources Department is being proposed to be eliminated in Fiscal Year 2009/10
as the work related to the processing of FML requests, which has been done by various HR
staff, will be consolidated and reorganized. The elimination of this vacant position will result
in a cost savings greater than the amount paid for the management of FML by Unum.
July 15, 2009 City Commission Meeting
Selection of a Voluntary Group Disability Poiicy and a Family Medial Leave Administrator
Page 5 of 5
CONCLUSION
The City Manager has reviewed the recommendations of Gallagher Benefits Services and
recommends accepting their recommendation, awarding the administration of the City's FML
policy for a three year period with a not to exceed fee of $38,000 annually for the first and
second years, along-term disability policy for the participants in the City's Defined
Contribution Pension (401(a)) Plan with a not to exceed fee of $9,950 for the first and
second years, for a three year period, and an agreement for a voluntary short and long term
disabilty plan for the employees of the City of Miami Beach, fully funded by employee
contributions, for a three year period.
T:\AGENDA\2009\July 15\Regular\Disability and FML Memo.doc
Attachment A
Gallagher Benefits Services
Letter of Recommendation
e~ Gallagher Benefit Services, Inc.
June 30, 2009
Ramiro Inguanzo, Human Resources Director
City of Miami Beach
1700 Convention Center Drive
Miami Beach, Florida 33139
Re: Employee Benefits Recommendations
Dear Mr. Inguanzo,
A Subsidiary of Arthur J. Gallagher ~ Co.
At the City of Miami Beach's request, we released Request for Proposals (RFP's) for all
City employee benefits including Medical, Dental, Life, Accidental Death and
Dismemberment, Voluntary and Dependent Life, Statutory Accidental Death and
Dismemberment, Employee Assistance Program, Vision, Short and Long Term
Disability. A vendor list has been provided illustrating what carriers were supplied the
RFP's and those that responded by product (See exhibit A). Recommendations will be
discussed briefly below.
Medical proposals were requested for claims administration and network access. We
requested both duplication of existing benefits and alternate benefit schedules. Responses
were received from the incumbent carrier Humana, AvMed, Cigna Healthcare, Aetna
United and Blue Cross & Blue Shield of Florida. We recommend renewal with Humana
based on the following:
1) Humana offered the lowest administrative fee's to the City including a reduction
of current costs
2) Retaining Humana will cause no disruption to member provider relations
3) Physician and hospital reimbursement analysis revealed Humana's strong South
Florida discounts
Life and Accidental Death and Dismemberment Request for Proposal resulted in thirteen
responses including the incumbent carrier, Standard. Short listing and continued
negotiations results in the recommendation of Hartford Life for the Basic Life and
AD&D, Dependent Life, Retiree Life and Voluntary Life. Reasons are as follows:
1) Lowest Basic Life, AD&D and Retiree cost to City and employees
2) Thirty six month rate guarantee
Statutory Accidental Death and Dismemberment Benefit Request for Proposal resulted in
two responses, the incumbent Hartford Life and Ace USA. We recommend renewal with
Hartford.
1) Hartford offered lowest cost including a 25% reduction in current annual
premium
2) No change to current benefits
3) Three year rate guarantee
One Boca Place
2255 Glades Road, Suite 400 E
Boca Raton, FL 33431
561.995.6706
Fax 561.995.6708
www.ajg.com
i~ ~.
p
Currently Dental coverage (Indemnity/PPO and DMO) are purchased by the City on a
fully insured basis for the DMO and self insured for the Indemnity and PPO. In addition
to the incumbent response from Comp Benefits, eight addition proposals were received.
We recommend awarding MetLife the fully insured DMO plan and self funding the
Indemnity/PPO dental coverage. Factors supporting this recommendation are as follows:
DMO
1) MetLife offered lowest DMO cost (16% reduction annually) while
improving benefits to members
2) Large network of general dentists, Periodontists, Endodontic and
Orthodontists.
3) Two year rate guarantee.
Indemnity/PPO
1) Lowest annual administrative fee's
2) Improved benefits to participating members
3) Thirty six month rate guarantee
The Employee Assistance Program is currently provided by Ceridian. Six additional
proposals were received and reviewed for cost, benefits provided and Medical Plan
integration opportunities resulting from the recent Federal Benefits Law changes
impacting Mental Health Parity. Humana is the recommended vendor for the following
reasons:
1) Improved benefits via increased face to face visits
2) Low cost relative to benefits provided
3) Medical plan savings opportunity as a result of common vendor coordination
The Vision benefits Request for Proposal resulted in eight responses. Similar to the
Dental benefits, both fully insured and self insured proposals were received. We are again
recommending this benefit be self funded based on the low claims risk and trend
predictability. EyeMed is the recommended vendor based upon:
1) Lowest administrative services fee
2) Comprehensive exam and hardware benefits
3) Large tri-county provider network
Short and Long Term Disability Benefits RFP's responses were evaluated by vendors
offering both coverage's. For continuity of coverage and a seamless transition from short
term to long term disability, the objective is to provide continuity of coverage and a
seamless transition from short to long term disability with no disruption due to
differences in disability definition, medical evaluation and benefits offered. Unum is the
recommended carrier.
1) Minimal participation requirement and no termination feature
2) Low overall cost
3) Family Medical Leave Act administration for all employees
4) Twenty four month rate guarantee for Long Term Disability and FMLA
Administration
a
~~
6~~'
We appreciate the opportunity to work with the City and staff and would be happy to
answer any questions you may have.
Sincerely,
Richard G. Schell
Area Vice Preside
Attachment B
Unum's FML
Return on Investment Illustration
City of Miami Beach -FMLA Return on Investment (ROI) Illustration
Illustrated ROI / FMLA with Unum
Background
Industry: Government Avg Salary: $62,000
Employees: 1,813 PEPM $1.45 illustration
Leave rate (industry avg*) : 10%
Avg Duration (industry avg*) : 23 days
Estimated incidence 182 -1o°i° incidence rate
Estimated FMLA acceptance rate 85% -Unum book is so°i°
Impacted claims (denied) 28 - 15% of 182
Average leave duration 17 days - 23 calendar days (17 work)
Est LW D's 476 - 28 leaves x 17
Estimate FTE's 1.83 x avg sal =
Estimated full time equivalent savings $113,508
FMLA Administrative Costs $31,546 @ 1.45 pepm
Cost~,~Benefit_(ROI) -~~~._:~ ~ ter . `' . = ,~3.~= ~7~~ ~:~~~~' ~. ,~..T ~~ ,,,s~~, .
Sentinel effect **
Initial annual incidence 155 85 % of 182
Trended annual incidence after 6 months 140 90% of 155
Annualized savings / FTE's 0.98 15 leaves x 17 Iwd's / 260
Annual savings @avg salary $60,808
Additional Cost :Benefit 0.9 : 1
... h,i~ w ., , . ,.
Projected.cost :-bettiefit +~sentinel ~-:~ f.~ , °~ ~ * 5 5 ::r1r, ~ 1 _ ,,
Additional Considerations
Inhouse FML admin costs /per SHRM
Employment law resources ***
Wrongful termination lawsuit /legal expense
Total add'I cost avoidance
Total Savings (Reduced Costs)
Total Projected,ROI
$18,130 1 fte / 5000 ee's to administer
$4,351 $2.40 per ee
10 000 avg cost = $150k/15 years
$32,481
$206,797
6.6':,1 - - #.._ <.~, ~~,~~:'
* Leave rate and duration based on Unum research on block of business and EPF Survey averages
*' Sentinel effect represents the decrease in submitted leave requests 6-9 months after program implementation
based on Unum historical book of business.
*** Cost of Legal resources are based on Unum internal research studies