The Cocoon blog

New year, new Cocoon. Just kidding, we’re still the technology-first company driving the digital transformation of employee leave that you know and love. Only a month into the new year, we’re excited to share the strides we’ve made toward our vision of transforming leave for both employees and People teams. This month’s launches bring even more clarity and automation into the leave management process to free up time for you to focus on the things that really matter. Let’s dive in:

Even more leave pay clarity for employees

Has an employee ever emailed you during leave with a list of 14 questions about their leave pay when they should have been focused on the reason for their leave instead? It’s not a great situation for either person. 

Last year, we launched the employee Pay Tracker to give employees visual insight into their different pay sources to reduce confusion. This month’s update brings even more granular details into the Pay Tracker to help employees understand their leave pay. 

Employees can see their leave pay in each period (both past and upcoming) broken into regular pay, leave pay, expected benefits, and total pay. Seamless access to these details means employees can find answers to their pay questions (a notoriously confusing part of taking leave) in real time right in Cocoon—which means fewer questions about pay popping up in your inbox. And, we’re actively working on complementing these details with more employee pay education through videos and FAQs right in their Cocoon Dashboard. Stay tuned.

Military family leave support (we’ve now got you covered on all FMLA leave types now)

We expanded our platform to include military exigency and military caregiver leaves, rounding out our support for all FMLA-covered leave types. If you need a refresher on military family leaves, we can help out with that too:

Who qualifies for military family leave entitlements?

There are two broad types of military family leave under FMLA:

1. Military Caregiver Leave

This leave is for employees who need to take care of a covered service member with a serious injury or illness. Their relationship to the injured service member may determine their eligibility to take this type of leave.

2. Qualifying Exigency Leave

This leave is for employees who need time to handle urgent issues that have come up because of a family member’s active military duty or their impending call to serve. There may be limits to what constitutes qualifying military duty, reasons for leave, and who is a qualifying family member (the FMLA lists nine categories of qualifying exigencies).

Improved visibility into employee leave events

Next up is our new Leave Log, which gives Cocoon Admins a timeline of key events, updated in real time, for each employee’s leave: submission, forms uploads, status changes, leave date adjustments, and more. This level of visibility further empowers HR teams with the context they need to answer employee questions quickly—no scouring through long email threads or frantically messaging outsourced reps for more information. 

Because employees use Cocoon for key leave tasks like date changes, logging claims tasks, and uploading certain forms, we have the unique power to surface these details to People teams in the way only a true software platform can.

Our latest HRIS integration: ADP Workforce Now® 

Last but certainly not least, we are thrilled to announce that we now offer an API integration with leading HRIS platform ADP Workforce Now® to automatically sync census information from ADP® to Cocoon in real time. Companies that use ADP Workforce Now® can save hours each month that would otherwise be spent manually uploading census files. Put those hours towards something more worth your time and be confident your employee information is always accurate, secure, and up to date. This launch marks Cocoon’s tenth API integration with the top HRIS platforms.

Harnessing the power of technology to evolve quickly for today’s digital workplace 

As a true software-powered leave management system, we have the flexibility to rapidly evolve and innovate based on feedback from our current and prospective partners. From systems that don’t speak to each other to confusion over leave pay and more, we’re committed to solving some of the most challenging parts of taking and managing leave. Expect many more exciting announcements in 2024 as we continue to build the tech-first tools that people-first companies deserve.

Tons of HR leaders (like you) are interested in leave management software, but might have questions or reservations. We get it—it’s a new category, and letting software take the lead when it comes to something as complex and personal as leave can feel off for some. Yet the reality is, SaaS solutions are far from new, and those continuing to rely on rep-based models or having People teams “figure it out on the fly” are stuck carrying out time-consuming and error-prone manual processes (like navigating insurance claims, calculating payroll, and calling 1-800 numbers for help). In the end, it opens you up to legal risk, higher employee turnover, and poor experiences for everyone. 

We’re confident that leave management software is the way of the future—not just because so many other industries have embraced SaaS solutions, but because this is the better way to manage leave for everyone. That’s why we’ve created this guide to leave management software, what it is, what the benefits are, and what to look for when you purchase it.

What is leave management software?

Leave management software goes by a few names (aka leave management system, absence management software, or leave tracking software). But in a nutshell, it simplifies and automates the major components and complexities of planning a parental, medical, caregiver, or other types of employee leave (especially when they need to be FMLA compliant). It does this by tackling compliance, claims, and payroll for People teams and leave takers. Leave management systems help support people through some of life’s most pivotal moments—whether it’s welcoming a new child into the family or navigating a loved one’s health emergency.  

When you search for leave management software, you’ll see a lot of solutions that primarily focus on tracking PTO requests and managing vacation and sick days—but that’s not what Cocoon does. While Cocoon does play nicely with your HRIS, it’s important to let each tool in your tech stack play to its strengths and distinct functions so you can cover your bases thoroughly, rather than stretching one tool too far in the wrong direction.

Key features of leave management software

Each software offering will differ, but the features below are all part of our ever-growing and evolving platform, and we think they’re table stakes.

Compliance

• Automated federal and state compliance
• Rules engine to determine eligibility
• Compliance alerts

Payroll

• Automated payroll calculations
• Pay tracking by source, amount, and date for both employees and HR teams

Reporting

• Dashboard for detailed insights into leave plans, claims, and pay
• ROI reporting to see benefits recouped, leave length, policy utilization
• Leave logs to see employee leave history

Employee experience

• Private leave design and planning
• Step-by-step claims guidance
• Comprehensive task list with automated reminders and triggers to complete tasks
• Ongoing expert support

Integrations

• Works with common HR tools for smooth transitions between tools and data sharing

Benefits of leave management systems

Whether you already have a rep-based leave provider or don’t have any system at all, switching to a leave tracking software will kind of feel like moving to online banking after writing checks and balancing the checkbook. Some of the top benefits our customers often mention include:

• Better financial forecasting for leave takers and HR leaders with accurate payroll and claims calculations
• Risk mitigation with always up-to-date compliance
• Time savings and improved work satisfaction for HR team
• Demonstrable ROI and savings (which also makes for easier leadership buy-in)
• Scaling with company growth and rapid change
• Peace of mind for leave takers before, during, and after leave

See how Cocoon stacks up with third-party, rep-based leave providers.

How to evaluate leave tracking software

We actually have a dedicated blog all about this, which we recommend checking out. But if nothing else, you should at least ask about the following topics:

• What is their process to ensure compliance with company policies and state and federal law? (especially across distributed workforces?)
• How do they handle claims submissions and tracking?
• What data and permissions do they need from your employees?
• Do they align with your company culture, strategy, and employee needs?
• What does implementation look like?
• What are their pricing tiers and how do they help you calculate ROI?
• Will they be able to scale with you as your company grows?

See a more extensive list of questions to ask a leave provider here.

Who should purchase leave tracking software?

Though some companies might be better candidates than others, the bottom line is that if you’re not satisfied with your current leave provider or if you feel that the complexity of managing leave monopolizes your team’s time, opens up your company to risk, and leaves employees frustrated, you have a clear need for leave tracking software. Other good candidates might include companies that:

• Have more than 50 employees within a 75 mile radius (for FMLA eligibility)
• Have more than 200 employees in general
• Are headquartered in states with robust leave laws like: CA, NY, MA, WA, DC, CO, CT, HI, NJ, OR, RI
• Have competitive parental, medical, or caregiver policies
• Already use HR SaaS tools like ADP, Workday, Gusto, or BambooHR

The bottom line about leave management software

Shaped by our own leave experiences and the horror stories of family and friends, we’re more determined than ever to revolutionize how People teams and leave takers plan and manage leaves, moving away with the antiquated systems of the past. With millions of people taking leave each year (and millions who don’t precisely because it’s too hard), it’s time for HR leaders to step up not just because it’s “the right thing to do” but because it makes better business sense. Now is the time to make the move to leave tracking software.

In order to attract and retain top talent, simply having a progressive parental leave policy isn’t enough.Your policy and employee handbook should set clear expectations about how and when the policy can be used, along with examples, so employees already know what to expect in the event they decide to utilize the benefit. Leaving things up to interpretation can mean employees don’t understand their rights and People teams feel less prepared. That’s why we created this 10-step checklist for People teams to review their existing parental leave policies. If you don’t have a policy in place yet, check out our free sample policy generator. 

Note: The following checklist was crafted by Cocoon’s in-house team of leave experts. However, it is not legal advice or a legally-reviewed policy checklist. It should be used only as a framework or starting point to review your own policy. Work with your legal counsel before introducing any leave policy updates or changes to your employees. 

Regardless of your policy, employees may be entitled to protected and/or partially paid leave under FMLA or applicable state programs. Any parental leave policy must be coordinated and integrated with federal FMLA, state, and local leave requirements, and applicable company policies and benefit plans.

1. Parental leave policy statement

Why: A policy statement sets the tone, giving you the opportunity to call out company values and give a brief overview of how your policy supports employees.

• Explain why you offer paid parental leave.
• Show how your company policy interacts with federal, state, and local leave laws.

2. Employee eligibility

Why: Clearly outlining eligibility before describing benefits helps avoid any misunderstandings with employees that may not qualify for your policy.

• Identify who’s eligible for your policy.some text
  • E.g. is it only full time employees?
• Call out when the policy can be used: From day 1 or after day 90? 

Tip: 43% of Cocoon customers have a tenure requirement, and of those that do, the median is 6 months–compared to FMLA’s 12 months.

3. Qualifying leave reasons

Why: Clearly explaining when your policy can be used helps prevent misuse and reduces the number of questions HR receives about it.

• Define when your policy can be used (qualifying leave reasons)some text
  • FMLA and state leave laws have their own defined qualifying leave reasons you need to be mindful of, but you should also outline your company’s policy.
  • E.g. “Eligible employees may take paid parental leave for periods when they temporarily are unable to work due to pregnancy, childbirth, or related medical conditions (before and after childbirth) and/or bonding with a child following the birth, adoption, or foster care placement of a child. [Sample Co.] treats multiple simultaneous births or placements as a single leave under this policy.”

4. Leave time and pay

Why: Setting clear time and financial boundaries helps employees plan their leave accurately so they can plan ahead and feel prepared.

• Outline how much the company policy covers, for how long, and when it must be used.some text
  • E.g. “Non-birthing parents can take up to 10 weeks of leave at 100% of pay, and it must be used within 12 months of the first day of taking leave.”

Tip: If you’re wondering how your policy stacks up against your peers, check out Cocoon’s 2024 benchmarks.

5. Intermittent leave

Why: Each leave comes with its own unique circumstances, prompting some leave-takers to ask for certain accommodations. Think through these scenarios to ensure HR gives clear and fair answers to everyone.

• Clarify whether intermittent leave is acceptable under your policy.some text
  • This may look like a minimum increment of a day or requiring that the time be used in a maximum of 4 chunks.

Tip: Most employers in Cocoon’s benchmarking dataset require 2-week minimum leave increments to reduce disruption to work.

• Offer guidance on PTO usage.some text
  • Are employees allowed to use PTO before or after their leave to extend their time off? If not, call that out here so they know right away.

6. How to request a leave

Why: Documenting your leave request process makes responsibilities clear so there are fewer questions or opportunities for a misstep. It’s also easier to scale and change the process when you formalize the steps.

• Outline step-by-step how employees can request a parental leave.

Tip: If you use a leave software like Cocoon, this is entirely self-serve for employees

7. Medical documentation requirements

Why: Failure to obtain and present certain documents by specific deadlines can mean benefits are denied or delayed. Make sure employees know what they need to obtain and submit, and when to expect it in the process. 

• Provide an overview of employee responsibilities to obtain medical certifications.
• Outline what’s required within the medical documentation. 

Tip: The employee Claims Task List provides a checklist with the necessary documents, due dates, and how to submit their to their medical providers. 

8. Return to work and job restoration

Why: Having a return to work plan not only makes leave takers feel wanted and welcome, but also sets clear boundaries about communication while they’re out on leave that can be awkward to rectify once they’re out.

• Outline what this process looks like at your company.
• Think about the timeline for your employees and HR team. When is it appropriate to start communication?

9. Group and non-group health benefits

Why: Suddenly losing access to benefits you were counting on or regularly use can cause a negative employee experience, so make sure leave-takers know what will continue, stop, or be put on pause. 

• Explain which benefits continue and which ones are put on pause.some text
  • For example, do they continue to vest stock? Do they have access to wellness stipends?

10. Coordination with statutory leave benefits

Why: Planning a leave can get pretty confusing when you’re doing it in a spreadsheet, Google Doc, or email chain. Clarifying this up front ensures you avoid situations where an employee tries to take any time available to them through their state program before utilizing your company policy.

• Clarify that your policy runs concurrently with statutory leave benefits.

Now that you’ve double checked your parental leave policy, you might also want to refresh your familiarity with FMLA policies to ensure you’re offering both a progressive and compliant leave.

In nearly every aspect of life, technology has revolutionized what we can achieve, and the time and effort it takes to do so. We can make a payment instantly, communicate with anyone worldwide, launch new businesses in a matter of clicks…yet when it comes to taking and managing leave, we’re stuck faxing claims, calling 1-800 numbers, and using websites that feel like they’re from the 90s. That’s why it's time for a digital transformation.

Our mission from day one has been to empower every working person to take care of the important things in life when it matters most. After two years, working with hundreds of employers, and supporting more than 5,000 leaves in Cocoon, we have more conviction than ever that technology has the power to transform taking and managing leave. Today, we’re excited to share our evolved and expanded vision, along with the technology that will power it — with an all new look and feel.

Bringing more awareness and seamless access to leave

We envision a world where everyone fully understands their leave options and can easily access the time and pay available to time. Cocoon pioneered a different leave experience from day one, starting with software that enables employees to plan a compliant leave privately, in their own time, and share with their employer when ready to request a leave. In the coming years, we plan to expand this level of awareness and access by making Cocoon available to anyone globally — whether they work full-time at a venture-backed startup, or part-time at a local hardware store. More immediately, we’re also building product support for any type of leave, from military to bereavement and beyond, plus expanded support for requesting leave as an ADA accommodation. 

Removing income as a barrier to taking leave

We envision a world where every working person can afford to take the time they need during life’s pivotal moments. Today, only 25 percent of U.S. workers have access to paid family leave through their employer, making leave prohibitively costly for most. Financial technology products have enormous potential to change this: imagine the ability to click a “top up my pay” button to keep your salary at 100% during a parental leave, or having the option of “leave lending” to get a loan for a medical leave.  

Access to pay also requires ensuring employees can easily access the state and private insurance benefits they are entitled to. After a lot of learning, research, and observing shifting state regulations that require direct interaction with claimants (California, for instance, partnered with ID.me and now requires two-factor authentication) we know it’s time to empower employees to file their own claims in a way that still reduces cognitive load. 

We’ve invested in a Claims Dashboard to show a dynamic tasklist of claims to-dos and deadlines, plus Claims Copilots that automatically surface key information from your HRIS (like start date, employer EIN, and more) to help employees fill out each form quickly and accurately. For notoriously tricky portals like the California EDD, our Copilot mirrors each screen and shows employees exactly what information to put where. We’re excited to keep pushing the boundaries on tech-enabled claims solutions that take the time to file from hours to minutes.

Empowering People teams with automation and integrations

Beyond the individual experience, we know how time consuming and nerve-wracking leave can be for employers. We’re building toward a future where employers rely on our technology to handle all the logistics of compliance, payroll, and beyond — freeing them to focus on strategic work that humans are uniquely suited for. 

Compliance is one of the most notoriously complex and painful parts of the process. The US alone has hundreds of state leave laws, with the legislation landscape changing monthly. Combined with the increase in distributed teams, staying compliant is harder than ever. Cocoon’s proprietary rules engine combines inputs from employees and systems of record then evaluates them against state and federal laws to calculate eligibility, so as laws or your policies change, you can trust Cocoon to capture those changes — no more compliance risk or Googling leave laws every time an employee moves to a new state.

Cocoon brings this same level of automation to managing payroll during leave. Our software estimates any benefits an employee will receive, and combines this with an employer’s policy to calculate what an employer owes. To make HR workflows like payroll even easier, we’re proud to share that Cocoon is the first leave management software to have API integrations with several top HRIS providers, including Workday, BambooHR, Zenefits, and Gusto, to automatically sync information to Cocoon in real time, eliminating manual entry and inconsistencies between tools. 

Perfectly coordinating the leave process also means giving employers seamless access to the information they need, all in one place. Our Admin Dashboard offers unmatched visibility to help employers support their teams, troubleshoot when questions arise, and make strategic decisions. Admins can see granular details into each employee’s leave plan and claims task list, while Pay Insights breaks down all payments made to any employee on leave across pay periods and by pay type. For company-wide trends, our Insights Reporting automatically surfaces key data about your leave program, like total benefits recovered and policy utilization across leave types and time frames. We’re excited to release additional Admin visibility tools and more two-way HRIS and payroll integrations in the coming months.

A new look and feel

Beyond the expanded vision and product offering behind it, we’re thrilled to reveal an all new look and feel for Cocoon. But it goes deeper than just colors and designs — we set out to rethink our brand to convey the experience we want everyone to have using our product: one that’s caring, trustworthy, empowering, and goes beyond the status quo. Our visual brand now fully embraces this identity and purpose. 

“The name ‘Cocoon’ evokes the warmth and protection we hope our product provides, so we decided on a wordmark as our primary logo. The symbol that accompanies it represents the complex web that is leave, but also the support and community Cocoon offers.”
_{- Camellia Neri, Brand Designer}

Try it for yourself with our free leave options explorer

To help expand awareness about leave options to every working person, whether their company uses Cocoon or not, and give you a glimpse of the future we’re building, we’ve made our leave planning tool publicly available. Simply input your details, and you’ll see a timeline of your leave plan with the leave laws and entitlements that cover it.

We are incredibly grateful to our employer partners, like Carta, Benchling, Notion, and many more for joining us on our journey to build a more humane future of work. We believe our mission will change the world for the better and there’s not a second to waste in creating a world where awareness and access are no longer barriers to taking leave. We’re building the tools our loved ones deserve — and we hope you’ll join us.

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Onwards,

Mahima Chawla & Lauren Dai

Cocoon co-founders 

Stacey Lim, a Senior Wellbeing Solutions Program Manager at Sequoia Consulting Group, has taken two parental leaves in two different states, as well as one leave with Cocoon, and one without — something that makes her a bit of an expert on the topic, having lived it from various perspectives. Her experiences demonstrate not only the complexities of planning and taking leave, but also the great things that can happen when employers consider and implement employee feedback to improve the leave experience. 

Paint us a picture of your first parental leave

“I got pregnant at the end of 2019, and had to make the nerve-wracking announcement to HR and my manager — all while news about COVID-19 was ramping up. The HR generalist did a really brief walkthrough of what to expect, but we both knew that there was more to it than that. At this time, we were living in Arizona, which doesn’t have a state disability program, and the company policy at Sequoia varied by state. It was a lot to plan and figure out.”

How did planning and taking your first parental leave go?

“In those days, there were just a few parental leaves a year at Sequoia, so there wasn’t a robust process around it. Depending on who your manager was, if they had taken leave or knew about it, your experience would vary. As an advocate manager, I had some familiarity with the process, but it’s so different when you do it while pregnant and as a new mother versus advising someone who is.”

“When I was out on leave, I felt like I didn’t have the time or the brain to do all the paperwork and keep track of it. I had to make specific time to go through emails, and sometimes they were from months back. Coming back to work was also kind of clunky, like how do I say I’m ready and how will they prepare for my arrival? Will the transition be smooth? How do I set my nursing schedule? Questions you don’t want to ask, but need the answers for.”

What changed at Sequoia between your first and second leave?

“There were dozens of babies born during the pandemic, so they realized it was time to revisit the parental leave policy. Soon after coming back from my first leave, Sequoia announced they were changing their process and policy, and even asked for my feedback. They made the policy the same across all states and started implementing Cocoon. That really seemed to give HR and employees the confidence knowing things were more universal and Cocoon was the leave sidekick.”

How did your second leave pan out?

“It was like night and day. Despite being in California this time (which has a lot more requirements and steps), I felt way more confident and supported. I loved that in Cocoon I could start planning before I even took leave. The portal was a game-changer to get answers to candid questions in real time, and play with my leave timeline and payouts. Then when I was on leave, I could log in and know where things stood without having to reach out to coworkers or meticulously skim through emails. I didn’t have to waste energy even worrying about tracking those things because it was all right there.”

What were the major differences you noticed having Cocoon vs. not?

“Having one central place for all parties with accurate and detailed information is critical. Cocoon breaks down your wage payout so there aren’t any payroll snafus or hiccups. The rules from your employer and government are codified so you know what the policy is, what’s approved, what the parameters are. You aren’t relying on email threads or random meetings from three months ago to piece it together yourself.”

“Another thing that was huge is that I actually felt like I got confirmation on things like claims submissions, so I could close out of something instead of worrying about it, if it was received, and then not having any idea who to call or how to check on it. It allowed me to better focus on my work before I left, not having to look stuff up or call during work hours. Not to mention the peace of mind I got not remotely having to worry about pay while on leave. I could simply focus on my family.”

How did your leaves change your relationship with your employer?

“Cocoon was a game-changer for us. Before, we were a little lost, and colleagues used to ask for and share tips about leave. Now that Cocoon is implemented, though, I don’t really see those conversations so we can focus on deeper kinds of support. Talking to other parents and people in different industries, I realized how great the benefits we offer are. We have a great leave policy, a supportive culture, and all of that’s codified in Cocoon. I think everybody is a lot more comfortable about the subject of leave, whether you’re taking one or supporting someone through it, which is huge.”

While the Family and Medical Leave Act (FMLA) offers basic guidelines for medical leaves, many forward-thinking and sought after companies want to do more to take care of their employees and appeal to candidates. However, crafting your own FMLA-compliant and competitive medical leave policy can be daunting. That’s why we worked with our founding legal Counsel, Frank Alvarez, to create an interactive medical leave policy generator to give you a starting point. 

Before joining Cocoon, Frank counseled employers for more than 30 years on ways to operationalize leave, accommodation, and other employment laws. We asked Frank to include questions in the policy generator that employers might typically consider when developing a relatively basic but effective medical leave policy. Hopefully, this gets you started in drafting a medical leave policy that works for your company and its employees.

As a reminder, Cocoon is not a law firm and, although Frank is an attorney, he is not your company’s attorney, and nothing in this blog or the policy generator is intended to provide you legal advice. Therefore, make sure to review number six in the process below!

Now that you have a starting point, read through each section below to continue revising your policy.

How to draft and launch a compliant and competitive medical leave policy:

1. Understand what medical leave is 

Your policy reflects your company’s concrete stance on what employees can expect for a medical leave and sets the tone. It should demonstrate how and by whom their medical leave will be handled. So before launching, plan on offering trainings to People team members and managers about your policy, the processes it entails, responsibilities and obligations for each party, and a range of use cases they’re likely to encounter so they can respond to employee questions with credibility and empathy. Now is the time to start having these conversations and trainings so everyone can get grounded in the why and the how of your medical leave policy. 

2. Define eligibility and how benefits interact

Thinking through the different eligibility criteria and medical leave scenarios helps you avoid miscommunications and unintentional exclusions or negative consequences. Here are some common eligibility parameters and benefits covered in a medical leave policy (which are included in our policy generator):

Common eligibility parameters

• Employee tenure/hours of service
• Full-time vs. part-time vs. short-term
• Exempt vs. non-exempt
• Geographic considerations (including worksite size)

Cocoon benchmark: 57% of Cocoon customers don’t have a tenure requirement, so employees are eligible from day one.

Benefit offerings

• Time — How long is their medical leave? Must they take leave in one continuous block of time or do they have rights to intermittent leave/reduced leave schedules?
• Pay & pay sources — How much will they get paid while on leave and is any of it conditional? How is pay calculated? Where does this money come from (e.g., state, insurer, employer, or a combination)? Does pay “top up” and coordinate with these other benefits?
• Access to health/non-health benefits — Will their rights to health insurance continue? Will they continue to vest stock options? Will they continue to have access to other perks?
• Protected time off — To what extent will you commit to restoring an employee’s job after they return from leave?  Will you commit to restoring them to their same job, an equivalent position, or something else?

Cocoon benchmark: Across all companies surveyed in our Paid Leave Benchmark report, the median medical leave policy is six weeks, with the biotech industry offering up to twelve.

3. Consider how your policy interacts with the FMLA

Most employers run company medical leave concurrently with FMLA or other statutory leaves — however, remember that FMLA provides unpaid leave while your company may provide paid leave or PTO. This can lead to some tricky policy decisions. You might choose to include the examples below under your medical leave policy, while allowing your PTO policy to address less serious and temporary medical conditions. You also can go more in-depth on FMLA compliance with our checklist.

Medical conditions covered by the FMLA policy

The FMLA defines a serious health condition as “an illness, injury, impairment, or physical or mental condition that involves either inpatient care or continuing treatment by a health care provider, involving a period of incapacity that prevents them from being able to work.” Some examples might include:

• Ongoing chronic condition that might require periodic medical visits on a regular basis or cause prolonged periods of illness (e.g., Crohn’s disease)
• A sudden or temporary health condition (e.g., recovering from an infection or surgery)
• A mental health-related leave
• A period of incapacity related to pregnancy, childbirth or related medical conditions
• A work-related injury (for which employees might receive workers’ compensation benefits)
• A serious long-term illness

Also keep in mind that the FMLA addresses parental leave, caregiver leave, and medical leave under the same roof — meaning the eligibility criteria are the same for those FMLA leave types. But as you consider policy goals (including talent acquisition and retention), you might decide to vary eligibility criteria or other policy rules for parental, caregiver, and/or compassionate leave policies (and we have policy generators for all three). 

4. Ensure legal HR compliance and alignment with company policies and benefits

Now you need to reconcile your policy with federal and state laws to ensure legal compliance. This can start to get tricky — especially if you operate in multiple states — as laws vary by location. Recognize overlapping legal obligations and aim for consistency between laws and company policies. For example, clarifying that PTO cannot be used before or after a leave.

Common statutory benefits and company policies to consider

• Federal FMLA
• State paid/unpaid leave
• State disability benefits
• Private insurance benefits
• Voluntary additional employer pay (e.g., top-up pay)
• Health insurance
• Other non-health insurance benefits (e.g., accrual of PTO, continuation of pension, access to mental health benefits, etc.)

Questions to ask

• Will you provide the same or more than what you are obligated by law?
• Will you provide a baseline regardless of employee location?
• Will your policy run concurrently with overlapping statutory benefits or be “stacked” on top of them?
• How does an employee request company medical leave?
• Do employees need to provide additional certifications upon requesting medical leave or returning to work?

5. Clarify responsibilities for each stakeholder 

Make your policy more transparent and stay legally compliant by making responsibilities for each stakeholder clear by defining:

• Who are your stakeholders? (internally and externally)
• What are leave-takers’ responsibilities? (e.g., many employees may be required to submit a certification with specific details from a healthcare provider in support of requesting FMLA coverage)
• What are others’ responsibilities? (People team, healthcare and insurance providers)

If you manage your leave with Cocoon, we’ll map a lot of this out for you to streamline next steps, owners, and deadlines. For example: 

• Employees get information about required medical certifications, dates, and deadlines
• Managers get notifications about employee leave dates (when they're leaving and returning)
• Admins admins have visibility into claims progress for all employees on leave

6. Get your legal team to review 

While our policy generator template gives you a starting point, you still need a legal expert to go over it with a fine-tooth comb before launching anything. They can ensure your policies are in line with state and federal guidelines and that they’re using the correct language. 

There’s a lot to consider, but with our policy generator and this walkthrough, you’re off to a good start. Once your policy is launched, Cocoon is here to dutifully help you implement it, and to help your employees plan and manage their medical leave should the time come.

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‍Employer notice requirements under the FMLA

Employer responsibilities under the Family and Medical Leave Act (FMLA) begin before an employee even requests a leave. The FMLA requires that employers provide general notice to employees about their FMLA rights and responsibilities. These general notices must be posted in the workplace and, if an FMLA-covered employer has any eligible employees, included in employee handbooks so that employees understand their leave rights and the steps they must take to exercise those rights before they need FMLA leave. 

On top of that, employers also have specific notice obligations that require them to inform employees of their FMLA rights and responsibilities when employees actually seek FMLA leave (employees don’t always remember policies and information from when they were first hired). These notice requirements help employees understand their eligibility and utilize what’s available to them under the FMLA.

FMLA administration for employers

Keep reading, or download an interactive version here:

Step 1: Display the FMLA workplace poster

First, make sure you have the required posters displayed at your worksite. The Department of Labor Wage and Hour Division (the agency responsible for enforcing FMLA) publishes the required FMLA posting.

Tip: Covered employers must display this poster even if they don’t have any FMLA-eligible employees. 

Step 2: Ensure your employee handbook includes FMLA policy language

Next, review your FMLA policy. The FMLA policy in your employee handbook must contain, at a minimum, the information provided in the FMLA poster. Here are some of the most important things you need to include:

1. Explain generally what FMLA leave is

FMLA provides eligible employees with job-protected leave for qualifying family and medical reasons. For private sector employers, FMLA is enforced by the U.S. Department of Labor’s Wage and Hour Division. Eligible employees can take up to 12 workweeks of FMLA leave in a 12-month period for certain qualifying reasons that include:

• The birth, adoption or foster placement of a child with the employee
• An employee’s own serious mental or physical health condition that makes the employee unable to work
• To care for the employee’s spouse, child or parent with a serious mental or physical health condition, and
• Certain qualifying reasons related to the foreign deployment of an employee’s spouse, child, or parent who is a military servicemember (Reference DOL Fact Sheet #28M(c) on this point)
• An eligible employee who is the spouse, child, parent, or next of kin of a covered servicemember with a serious injury or illness may take up to 26 workweeks of FMLA leave in a single 12-month period to care for the servicemember

Employees have the right to use FMLA leave in one continuous block of time. When it is medically necessary or otherwise permitted (i.e., you allow this as an employer), employees may take FMLA leave intermittently in separate blocks of time, or on a reduced schedule by working less hours each day or week.

2. Explain employee FMLA eligibility criteria  

Explain that employees must:

• Work for a covered employer 
• Have worked for their employer at least 12 months
• Have at least 1,250 hours of service for their employer during the 12 months immediately preceding their leave, and
• Have at least 50 employees within 75 miles of their work location

Tip: There are special rules for employees who do not have a fixed physical worksite, such as outside sales people or remote employees.

3. Explain how employees can request FMLA leave

Explain that employees must:

• Follow their employer’s normal policies for requesting leave
• Give notice at least 30 days before their need for FMLA leave, or, if advance notice is not possible, give notice as soon as possible
• Provide enough information to their employer (and/or their employer’s leave administrator) so they can determine whether the leave qualifies for FMLA protection. Employees do not have to share a medical diagnosis

Tip: Some states, such as California, prohibit employers from seeking medical diagnosis. Check with counsel on any state specific medical confidentiality rules that overlap with FMLA.

• Inform their employer if FMLA leave was previously taken or approved for the same reason when requesting additional leave
• Provide their employer any required certification from a health care provider to verify medical or caregiver leave or any required certification of a qualifying exigency

4. Explain the FMLA’s relationship with other laws

Explain that the FMLA does not affect any federal or state law prohibiting discrimination, or supersede any state or local law or collective bargaining agreement that provides greater family or medical leave rights. 

5. Explain your obligations to the employee as their employer

Explain that, if an employee is eligible for FMLA leave, as a company, you must:

• Allow the employee to take job-protected time off work for a qualifying reason
• Continue the employee’s group health plan coverage while the employee is on leave on the same basis as if the employee had not taken leave, and
• Allow the employee to return to the same job, or a virtually identical job with the same pay, benefits and other working conditions, including shift and location, at the end of the employee’s leave
• Not interfere with the employee’s FMLA rights or threaten or punish the employee for exercising their rights under the law. This includes not retaliating against the employee for requesting FMLA leave or cooperating with a WHD investigation. 

Explain that, after becoming aware that the employee’s need for leave is for a reason that may qualify under the FMLA, you must:

Confirm whether or not the employee is eligible for FMLA leave and provide written notice of:

• Any determination that an employee is eligible
• The employee’s FMLA rights and responsibilities, and 
• How much of the employee’s requested leave, if any, will be FMLA-protected leave. 

6. Provide employees additional information on ways they can exercise FMLA rights

• Provide employees the DOL’s telephone number (1-866-487-9243) and website URL (dol.gov/fmla) so they can find more information about FMLA.
• Tell employees they may file a complaint with the DOL’s Wage and Hour Division or file a private lawsuit against you in court if they believe their rights under the FMLA have been violated. 

As always, check with your legal counsel to ensure that your FMLA and other leave and accommodation policies fulfill all federal, state and local law requirements, and are fully aligned with your other employment policies and benefits. This checklist generally applies to private sector employers. Please note that there are special FMLA requirements for certain school employees, airline flight crew personnel, and employees covered by collective bargaining agreements.

Customers sometimes tell us they feel hesitant leaving something as personal and emotional as leave “up to software.” But the reality is that even if you’re paying for a rep-based “white glove” service, that doesn’t mean your employees are getting the attention and service you might think. Even if they are, it’s undeniable that software can automate compliance monitoring, reconcile eligibility requirements, and tackle payroll calculations and do so quickly with less room for error.

Here’s a side by side comparison of what to expect with Cocoon’s leave management software versus the traditional leave provider experience. 

For employees taking leave:

Planning and announcing your leave

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Talking to your HR team to request your leave is nerve-wracking enough, especially if you don’t understand the company policies, state laws, and general options for your leave. From there, dialing up a stranger who will become your new leave of absence manager on a 1-800 line, to begin to piece together your leave sounds unthinkable. Pre-planning in Cocoon means you can start seeing timelines and options before you tell anyone and go into that conversation with confidence.

“Employees love that there’s automation and interactive forms in the app so they can just plug stuff in and start planning. But they also feel that Cocoon gives the right amount of hand-holding when you need it.” — Melanie Wagner, Senior Manager of People Operations at Hatch

Determining your eligibility 

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When it comes to leave compliance, you don’t want to be at the mercy of how knowledgeable a rep happens to be about federal and state leave laws, and then hope that they can reconcile them with your company’s policies perfectly on schedule. This can lead to noncompliance or miscommunications — both with serious potential legal and/or economic impacts. Knowing they’re baked in with Cocoon helps you start off compliant and stay there — and if anything falls out of place, you’ll get notified immediately.

“It's just not feasible to have a person on site to manage the number of leaves, then beyond that, someone who understands every state's differing compliance regulations. We’re grateful for partners like Cocoon thinking about the employee experience whether it’s their first or second time." — Payroll Team Lead, Cocoon customer

Filing state and disability claims

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Without Cocoon, filing claims either means passing power of attorney and intimate details to your leave rep or simply going it alone. Either way, nobody takes you through the process in real time nor shows you what’s next. Cocoon lights your path, walking you through the claim filing process with education and automation to save time and reduce the risk of errors causing endless follow-ups, while keeping you in the know about what’s due, when, and how to submit it.

"Cocoon puts a leave taker in the driver's seat — making a process that can often feel ambiguous and tedious more streamlined and simplistic!" — People Team Lead, Cocoon customer

Understanding leave pay

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Knowing when, how much, and from where you’re getting paid is often one of the most stressful parts of leave — not only because you might not know how you’re going to pay bills, but also because you’re likely wrapped up in whatever prompted the leave in the first place. Being in the hospital or at home with a new baby is not the appropriate time to call someone wondering where your latest paycheck is. Cocoon wants you to know before, during, and after you get paid so you can plan accordingly.

“While I was on leave with a new baby the joke was, “Choose two: eat, sleep, or shower,” and I was instead building spreadsheets to show what I was owed.” ‍— New parent before using Cocoon

Getting support along the way

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The “one-on-one” experience you think you’re getting with a service rep isn’t for emotional support, it’s likely about logistics that would be automated for you already in Cocoon. We see that software taking care of the logistically sticky parts of leave management tends to resolve a lot of the issues that prompt you to need additional support in the first place. If not, we’re still only an email or phone call away with a team of specialized experts. The experiences of our Support team go on to constantly improve our product and education — something that doesn’t get codified at a rep-based company.

“I just wanted to take a minute to say how thrilled I’ve been with Cocoon. I’ve talked to so many other parents navigating the parental leave process right now and they’ve all had such a difficult time, but you’ve made it absolutely seamless." — Customer feedback survey response

For employers and People teams:

Reporting capabilities

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Information that gets cobbled together manually and relies on you requesting it is prone to inaccuracies and delays. With Cocoon’s Admin Dashboard data at hand, you can actually measure the ROI not just of Cocoon software, but of your leave program in general:  how many benefits were recovered, policy utilization metrics, average leave length, etc. — ultimately giving you an advantage in strategic planning, measuring company savings, and demonstrating the efficacy of your leave program.

“It was really helpful when we went through renewal to make the case for finance… to [say] ‘we’ve actually saved this much money that we would have had to pay in salary.’” — HR Admin at a 2,000-person software company.

Calculating payments for questions and compliance

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Leave-takers rightfully get quite stressed and confused about their pay situation while on leave — with lots of questions that People teams need to be able to answer quickly and correctly. You also need to understand how your policy overlaps with other legal obligations and statutory benefits to ensure compliance and for proper accounting of them. If you’re operating in multiple states, this only gets more complicated and crucial. With Pay Insights, you get a breakdown of all payments made or to be made to anyone on leave across several categories so you can answer questions, stay compliant, and forecast future leaves, without having to calculate it yourself.

People leaders are drawn to HR because they love working with people. People teams maximize value for employees through recruiting, talent development, total rewards, overall employee experience, and company culture. In other words, People teams help set their employees up for success. But what happens when employees are set up to fail? Anyone that’s ever managed an employee leave in-house (or with a traditional leave provider, for that matter) will understand that the complexity can quickly become overwhelming and lead to a poor employee experience.

What employee leave looks like without a solution

Picture this… you get an email from an employee in Washington announcing that they’re pregnant and need to take parental leave, but they want to set up a call to go over their options. You send a congratulations email and then spend the rest of your day frantically researching Washington’s leave laws to make sure you’re prepared for the call. 

• Do you need to send any compliance notices? How does it interact with the Family and Medical Leave Act (FMLA)? 
• What’s the application process like? The state website has 12, 16, and 18 weeks of paid leave listed — what do you tell the employee? 
• You see something about employer contributions, so you also send a note to the Finance team to make sure that’s been setup correctly. 
• There are a lot of qualifying reasons for paid parental leave but is there anything else you need to ask the employee? 
• What are you allowed to ask? 

You document everything diligently and make it through the call with the employee (phew!) The next day, you receive a Slack message from an employee based in California that they’re adopting and will also be taking parental leave. You now get to start this process all over again because nothing you learned yesterday about Washington applies to this employee and you need to know about CFRA, CA PFL, CA PDL, and SF PPLO to have an informed conversation with your employee.

Keeping up with compliance requirements

This cycle never ends for your team — even if you’re a seasoned HR veteran and you’ve helped many employees take leave, the laws are constantly changing. You can build the most in-depth and beautiful spreadsheet in the world and it will constantly need to be updated as states change weekly benefits maximums, covered relationships, submission deadlines and processes, and more. As of this writing, 11 states have Paid Family Leave laws in effect, 7 others have passed laws that will soon go into effect, and more than 15 states are currently proposing Paid Family and Medical Leave laws. Not only do you need to know FMLA like the back of your hand, but also you need to keep track of state-by-state variances. Some states have mandatory participation, while others offer voluntary involvement. Some states are exploring private insurance options, while others are looking into building out full leave insurance products.

On top of all of this, these federal and state leave laws need to integrate with your company policy. Keeping compliance tasks straight can often feel like a never-ending checklist. Unfortunately, it’s a checklist you can’t skip out on unless you want to open your company up to legal risk and lawsuits. The cost of leave mismanagement can be high — upwards of $1.3 million for a single case in Massachusetts. Whether you manage leave in house, contract a traditional leave management provider, or implement leave management software, understanding the fundamentals of employee leave compliance is crucial. 

Why manually tracking FMLA and state leave compliance doesn’t work

Looking at the complexity of leave laws in the United States, People teams quickly realize there are too many regulations and too much legalese for a single person (or team) to keep straight. Not only is it a time drain, it's an inefficient use of your team's time. When companies have inefficient processes, they look for software solutions to automate things that humans shouldn't have to do. Modern employers recognize this across their operations—from comprehensive platforms like SenseHR, Lattice, and Culture Amp that handle some of the core HR administration and workplace management, to dedicated solutions for specific functions like leave management. Your company has a payroll system to streamline pay and an HRIS system to help with People management. Your Payroll team isn't calculating taxes in spreadsheets and mailing paper checks—so why are you managing leave manually?

When your team is ready to find the right leave management system, make sure you’re evaluating solutions that can scale with your team. If your spreadsheet to keep leave laws straight was error-prone, what makes a rep-based service model that does manual intake calls to determine employee eligibility any different? Don’t leave the accuracy and quality of your employee’s entire leave experience to the luck of the draw based on which representative they’re assigned. Technology is here to change the way you manage leave. Cocoon’s software codifies ever-changing federal and state leave laws and automatically sends required compliance notices, eliminating human error and legal risk across geographies — their support approach also backs this up. This gives your People team time back to focus on what matters most — putting your employees first.

Each year, 20 million Americans file for leave with the Family Medical Leave Act (FMLA), and on any given week, 5% of the workforce is taking a leave of absence. With more than 100 leave laws in the U.S., even if you master your employee leave laws in California, you’ll find that adding New York’s means starting from scratch. These intricacies become a drain on your time and open you and your company up to unnecessary risk — which is why we created this guide, and why Cocoon takes on the task of sending eligibility and designation notices.

Read on for the basics of managing compliant leaves in every state and download our FMLA leave compliance notice checklist for notices you’re required to send employees when they request leave.

Checklist: FMLA leave compliance notices

Use this checklist to keep track of notices you're required to send employees when they request leave.

The three layers of FMLA and leave compliance

To break down the complexity of leave compliance, we find it helpful to discuss in terms of the “three layers”: entitlements, commitments, and accommodations. Which are then followed by required compliance communications.

1. Leave entitlements

A leave entitlement is a law that provides job protection for a leave of absence. Job protection is a benefit where the employee has a right to keep their job if they miss work for a qualifying reason (like bonding with a child) specified under the law. 

There are leave entitlements at the federal, state, and local levels. These laws are typically clear-cut, black-and-white, and include certain employer and employee obligations. For instance, Family and Medical Leave Act (FMLA) covered employers are required to send their employees compliance notices at different points throughout their leave. 

Note that leave entitlements are different from statutory pay entitlements. A leave entitlement protects your job, while statutory pay provides partial to full salary replacement while on leave. Examples of state or local pay entitlements are the San Francisco Paid Parental Leave Ordinance (SF PPLO), California Paid Family Leave (CA PFL), and California State Disability Insurance (CA SDI). There are some laws that provide both job protection and pay like Washington’s Paid Family and Medical Leave. 

The graphic below illustrates many, but not all, of the state leave and pay entitlements that employers operating in multiple states might need to consider.

There are typically four main components to laws that fall under the umbrella of leave entitlements: 

1. employer coverage requirements
2. employee eligibility requirements
3. qualifying leave reasons
4. benefit-related details. 

Here’s what it looks like for FMLA, as an example:

Employer coverage requirements

FMLA covers your company if one of the following applies:

• Your company has employed 50 or more employees for at least 20 workweeks in the current or previous calendar year – including employees who your company jointly employs as a “joint employer”
• Your company is a successor in interest to a covered employer (described in Section 825.107 of the FMLA regulations)

Employee eligibility requirements

Employees of covered employers are eligible to take leave under FMLA if they:

• Have worked for your company for at least 12 months. The 12 months of employment are not required to be consecutive and the look-back period is generally 7 years from the date an employee seeks leave (or longer if breaks in service were due to active military service);
• Have worked at least 1,250 hours during the 12 months leading up to the start of leave; (special hours of service rules apply to airline flight crew members); and
• Are employed at a location where your company employs 50 or more employees within 75 miles of the employee’s worksite

Qualifying leave reasons

Covered employers must grant eligible employees up to 12 workweeks of unpaid, job-protected leave in a 12-month period for one or more of the following reasons:

• The birth of a child, and to bond with the newborn child;
• The placement of a child for adoption or foster care, and to bond with that child;
• To care for an immediate family member (spouse, child, or parent – but not a parent “in-law”) with a serious health condition;
• To take medical leave when the employee is unable to work because of a serious health condition; or
• For qualifying reasons due to the employee’s spouse, child, or parent being on covered active duty or call to covered active duty status as a member of the National Guard, Reserves, or Regular Armed Forces.

The benefit and related details

• The Family and Medical Leave Act (FMLA) provides eligible employees up to 12 workweeks of unpaid leave a year, and requires group health benefits to be maintained during the leave as if employees continued to work instead of taking leave. Employees are also entitled to return to their same or an equivalent job at the end of their FMLA leave.
• The FMLA also provides certain military family leave entitlements. Eligible employees may take FMLA leave for specified reasons related to certain military deployments of their family members. Additionally, they may take up to 26 weeks of FMLA leave in a single 12-month period to care for a covered servicemember with a serious injury or illness.

While it’s clear from the above that FMLA includes a lot of specific details for employers to keep top of mind, the same is true for all state and local laws governing employee leave that overlap, add on to each other, and occasionally conflict.

2. Leave commitments

Leave commitments are voluntary leave policies and benefits, like an employer’s parental or medical leave policy and disability insurance. 

Like leave entitlements, employers generally impose employee eligibility criteria for leave commitments, and offer a certain amount of time and pay for a leave through their policy. Some components of a typical leave policy are:

• Qualifying reasons
• Leave time & pay
• Tenure requirements
• Covered employee types
• Permitted leave increments
• Coordination with other benefits

Keep in mind that employees covered under entitlements like FMLA or the California Family Rights Act (CFRA) can legally take leave whether or not you have a policy in place, and regardless of how much time you offer.

3. Leave accommodations

Finally, leave accommodations typically come into play when employees seek to take medical leave but are not eligible and/or have exhausted any leave entitlements or commitments. This happens because employers may be legally obligated under the Americans with Disabilities Act (ADA) to provide job-protected leave as a reasonable accommodation to employees with qualifying disabilities. 

4. Compliance notices

When an employee requests leave, there are several notices employers covered by FMLA must send to employees. These include: 

• Notices telling employees whether they are eligible under FMLA
• Their rights and responsibilities if they are eligible employees
• A designation notice telling employees whether their request for FMLA leave has been approved or denied 

Notice of Eligibility example

This notice must tell an employee whether they are an eligible employee under FMLA. As a reminder, an employee of a covered employer is eligible to take leave under FMLA if they meet all three of the criteria in the “employee eligibility requirements” list in section one above.

The notice must be executed carefully and fulfill the following:

• You must notify employees of eligibility within 5 business days either orally or in writing of the initial leave request or when you discover an employee may need leave for an FMLA-qualifying reason.
• If an employee is not an eligible employee, you must state at least one reason why they fail to meet the FMLA’s eligibility criteria. If the reason for ineligibility is the employee’s failure to satisfy FMLA’s length of service or hours of service requirements, you must also tell the employee, as applicable, the number of months the employee has been employed by the employer and/or the hours of service with the employer during the 12-month period.

Other notices required include a Notice of Rights and Responsibilities, a Designation Notice, and much more. To see all notices, download our full FMLA leave compliance notice checklist.

Don’t compromise on compliance: Cocoon’s technology codifies ever-changing federal, state, and local leave laws and automatically sends required compliance notices, eliminating human error and legal risk across geographies. 

Key takeaways

With ever-changing leave laws and variances across state lines, it can be time-intensive to ensure your organization is always compliant. 

• Leave entitlements are clearly defined laws that provide job protection for a leave of absence. 
• Leave entitlements are different from statutory pay entitlements.
• Leave commitments are voluntary; they are the time off and pay you (as the employer) commit to your employees when it comes to leave. 
• Leave accommodations are made when an employee requests a leave of absence but is not eligible and/or has exhausted any leave entitlements or commitments.
• If you are covered by FMLA or other state laws, there are certain things you are obligated to tell employees and notices you are required to send. 
• Download our compliance notice checklist to make sure your People team knows what these are—and become a Cocoon customer so we can help you.