Compliance season used to mean new laws, updated plan documents, and adjusted payroll codes. The work has changed. Legal requirements now sit in direct tension with the operational logic of the systems that administer benefits.
The part of this story that gets skipped is the middleware: the eligibility feeds, data integration layers, and carrier connectivity protocols that quietly run your benefits. Three legal updates are stress-testing that layer right now. If you run a standard HRIS-to-carrier file feed, your system may already be failing in ways you will not see until a claim is denied, a COBRA notice is generated wrong, or a fiduciary breach surfaces.
1. The PWFA and the third eligibility state
Most coverage of the Pregnant Workers Fairness Act stops at reasonable accommodations. The systems problem sits a layer below that, in eligibility logic.
The PWFA has been in force since June 27, 2023, and the EEOC's final rule took effect June 18, 2024. The law requires temporary leave or modified duty for pregnancy, childbirth, and related conditions. The final rule also bars an employer from forcing an employee onto leave when another accommodation would work, and from substituting an accommodation the employee did not accept through the interactive process.
The systems crisis:
Your core benefits administration system, whether Workday, ADP, UKG, or a similar platform, runs on binary logic: active means eligible, terminated means not eligible. The PWFA adds a third state. An employee can be active but receiving a temporary, non-FMLA accommodation that outlasts the plan's standard leave window.
- The gap: No standard HRIS event code exists for a pregnancy accommodation as a fluid status. When a payroll clerk marks someone on a leave of absence to trigger the accommodation, the benefits system often terminates coverage because leave rules default to the 12-week FMLA cap. The PWFA carries no such cap.
- The result: COBRA notices generated in error, medical claims denied mid-treatment, and ERISA exposure that a standard vendor configuration was never built to catch.
What to do:
Audit your event-driven logic. Can the system tell a pregnancy temporary disability apart from a PWFA accommodation on the eligibility feed? If not, you are carrying risk you could remove. Ask your HRIS vendor for a custom reason code that bypasses standard leave duration limits.
2. Mental health parity and the data your systems do not join
The MHPAEA final rules arrived September 9, 2024, and took effect November 22, 2024, with staggered applicability dates. The meaningful benefits standard and the tightened NQTL comparative analysis requirements apply to plan years beginning on or after January 1, 2026.
The duty to run non-quantitative treatment limitation analyses has existed since the Consolidated Appropriations Act of 2021. What the final rules changed is depth. Plans now need to show that network reimbursement rates and other limits on mental health and substance use disorder benefits are comparable to medical and surgical benefits. That showing takes claim-level pricing data from the TPA or carrier, not a summary spreadsheet.
The systems crisis:
Most self-funded employers do not own their claims data. They depend on a TPA to hand back a report. The analysis requires a statistical look at network adequacy against out-of-network policy.
- The gap: Your enrollment platform does not talk to your claims system. The analysis needs enrollment demographics joined to claims adjudication codes, and most mid-market employers do not have that joined view.
- The liability: If you cannot show that a narrow mental health network was not built for administrative convenience, you carry fiduciary risk. The system did not flag it because the system does not distinguish a psychiatrist from a cardiologist.
What to do:
Link your enrollment data to your claims data. If your HR system cannot identify which employees used mental health services and compare that against denial rates, you cannot complete the analysis. The Departments paused enforcement of the 2024 final rule in 2025 while they reconsider their parity enforcement program, but the comparative analysis duty from the CAA 2021 amendments still stands, so treat the data work as current. A joined enrollment-to-claims dataset is protected health information, so host it under a business associate agreement rather than in your core HRIS.
3. Garden leave and the paying-through status gap
The FTC non-compete rule never became law. A Texas federal court struck it down in August 2024, and in September 2025 the FTC dismissed its appeal and acceded to the rule's vacatur. The rule also never required garden leave. In its commentary, the FTC said a garden leave arrangement, where a worker stays employed and keeps full pay and benefits on a pro rata basis, is not a non-compete at all.
Garden leave still matters for your systems because it exists outside that rule. Massachusetts has required garden leave or equivalent consideration in enforceable non-competes since October 2018, and employers elsewhere use garden leave and salary continuance arrangements voluntarily to buy a quiet transition.
The systems crisis:
This creates an eligibility status most payroll-to-benefits connectors cannot express: an employee who is no longer working and no longer on time and attendance, but who is still paid and still entitled to benefits for the length of the garden leave.
- The gap: Your system likely has a salary continuance code, but many connectors read that code as a signal to end benefit eligibility on the first of the following month.
- The failure: When payroll sets the arrangement up manually, the automated life event logic never fires a termination. The employee can stay on the plan after the garden leave ends, and the employer keeps paying premiums it cannot recapture.
What to do:
Build a benefit-only-active status code. If your system cannot process a wage without a matching timecard, you cannot run this arrangement without manual intervention. Test the scenario with your vendor before a departing executive triggers it.
Run a systems architecture audit
Across all three updates, the danger sits in the gap between what the law requires and what the system can do. Legal compliance has become a data integration problem.
Your vendor may claim compliance. Ask whether the system can process a retroactive eligibility backdate tied to a legal accommodation request rather than an enrollment life event. If the answer is no, you are carrying fiduciary risk on a system built before the PWFA existed.
The highest-value project now is a systems architecture audit that maps each legal requirement onto your data file feed schema. Where the schema does not match the law, the law wins. The gaps are cheaper to find now than after a denied claim or a botched COBRA notice.
About the author: a benefits systems consultant with more than a decade spent designing and troubleshooting the integrations that keep health plans running, including work for Fortune 500 companies and mid-market employers on compliance-driven system architecture.