Maxed Out Medical Leave: Does Your Policy Require Automatic Termination?

By Styskal, Wiese & Melchione

It doesn’t seem so unreasonable at first glance: Imagine that your credit union’s medical leave policy provides employees a generous amount of time for medical leave—say, 12 months. But, in order to prevent leave abuse, it also provides that employees who take more than this maximum time off and do not return to work after such time will be terminated. While such a policy seems nondiscriminatory since all employees on medical leave are treated the same way, would it be legally permissible? Beyond that, is such a policy even a good idea? With recent and very public enforcement efforts by the U.S. Equal Employment Opportunity Commission (EEOC) against employers sporting these so-called “automatic termination” policies, the answer to the second question, at least, appears to be “no.” The EEOC’s position is that employers may not apply a leave policy where employees are automatically terminated after they have been on leave for a certain period of time to a disabled employee who needs leave beyond the set periods. The EEOC’s stance stems from broad provisions in the Americans with Disabilities Act (ADA) which require employers to (among other things) assess requests for medical leave, including extended leave, individually and on a case-by-case basis. Under the ADA, employers must engage in a good faith interactive process with disabled employees to assess their needs and the reasonableness of the accommodation requested. This means a back-and-forth dialogue about the needs and suggestions of the employee. Even if the employee does not openly suggest an extension of leave, employers are reminded that extended leaves of absence are a common form of reasonable accommodation to consider. Of course, during this process, the employer should also evaluate whether other viable accommodations exist which may allow the employee to perform his or job duties. Again, communicating with the employee and assessing the reasonableness of extended leave in good faith, as it applies to the particular situation, is crucial—and not applying bright-line or inflexible policies across all circumstances. Suggestions for your credit union include:

  • Review your credit union’s medical leave of absence policy and your FMLA policy (if applicable). Do the policies state that employees taking time off beyond a maximum leave period will be automatically terminated? If so, consider “softening” such language to provide that requests for extension of leave beyond the maximum will be considered on a case-by-case basis and in compliance with federal, state, or local disability laws.
  • What are your credit union’s actual practices when an employee requests extended disability leave or indicates they will need additional time off beyond a stated maximum? Even if you have an “automatic termination”-type policy in place, your credit union should not be inflexible when dealing with such requests. Instead, communicate openly with your employee about his or her needs relating to the medical issue or disability (interactive process), and discuss ways the credit union can work with the employee to accommodate the request or disability, which may include permitting leave beyond the “maximum” period (reasonable accommodation). Be sure to document the communications.
  • Do not require employees be cleared to return to work as “100% healthy” or “with no restrictions” before returning to work. Remember that the ADA requires employees to be permitted to work, even if the employee is disabled or has work restrictions, so long as the employee can perform the essential functions of the job with (or without) reasonable accommodation, and it does not result in an undue hardship for the credit union.

If you have questions regarding this topic, please feel free to contact our office at 818-241-0103.

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