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Can There Be Limits to Leave Policies?

Long-term leaves of absence associated with medical conditions or disabilities have confused employers for years.  Often, an employer chooses not to formally terminate an employee that has been gone for a very long time for fear they will be subject claims of retaliation under the FMLA, ADA, or state workers’ compensation statute.  As a result, employers have individuals technically employed and on the employee roster, but with little prospect of work actually being generated for the business.

 Thus, the question arises as to whether an employer can establish a leave policy that provides for termination based on absence after a fixed period of time.  The EEOC has long taken the position that such a policy may violate the ADA.  As a result, many employers decide to just place the absent employee in the ether-world until the employee reemerges and returns to work or quits.

 One employer, United Parcel Service, has taken a different approach by maintaining a leave policy which provides for termination after twelve months of absence.  As a result, on August 27, 2009, the EEOC filed suit against UPS in the Northern District of Illinois alleging the policy violated the ADA rights of an employee with multiple sclerosis. 

 On the same date the suit was filed, the EEOC submitted a press release that states:

“This case should send a wake-up call to corporate America that violating the Americans with Disabilities Act will result in vigorous enforcement by the EEOC. The ADA has been the law of the land for nearly two decades now, and employers simply have no excuse for failing to abide by its provisions.”

This case has already garnered the attention of employers and employment law practitioners interested in understanding if policies that set absence limits will be permissible under the ADA.  The employer’s major argument is how does requiring employers to adopt an indefinite policy with no defined time period become a “reasonable accommodation?”  The argument is sound; by its very terms an indefinite policy should be deemed unreasonable. 

This case is not the first of its kind brought by the EEOC.  In 2006, the EEOC settled a similar case against JPMorgan Chase & Co. for $2.2 million.  The EEOC also settled a case with United Blood Services on the same issue for $650 thousand dollars in 2001.

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