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Employers Beware:  Automatic Termination Following Medical Leave is Risky

Some employers' leave policies provide that employees will be discharged if they fail to return to work after their designated leave expires. Although these polices may appear nondiscriminatory because they can be applied uniformly, automatically terminating an employee at the end of the employer's maximum leave period may be a violation of the Americans with Disabilities Act (ADA). The ADA is clear that a reasonable accommodation may include extending periods of leave, as long as doing so does not create an undue hardship (i.e., significant expense or difficulty) for the employer.

The Equal Employment Opportunity Commission (EEOC) has taken an aggressive stance with employers that enforce automatic termination policies. Two recent examples:

• JP Morgan Chase paid $2.2 million to resolve a charge that its six-month leave policy violated the ADA because it provided for termination in every case where the employee's leave exceeded the six-month maximum, rather than a case-by-case determination of whether additional accommodation was possible.
• The EEOC alleges that UPS's leave policy violates the ADA. An employee took a 12-month leave of absence because she had multiple sclerosis. She returned to work for a few weeks, but soon needed additional leave to deal with the side effects of her medication. UPS' leave policy called for automatic termination should an employee require more than 12 months of medical leave, and UPS terminated the employee for exceeding that limit. The EEOC alleges that UPS failed to reasonably accommodate the employee. This case is ongoing.

Leave policies, even generous ones, that require automatic discharge after a specific period, may violate disabled employees' right to reasonable accommodation under the ADA. The ADA requires a case-by-case assessment (including talking to the affected employee) to determine whether a particular employee needs a limited extension of medical leave as a reasonable accommodation (or another form of accommodation, if it is reasonable and available). Employers should review leave policies to ensure they do not contain arbitrary deadlines for returning to work following leave.

Please contact us if you have questions or need assistance drafting or revising a policy.