The Obligation to Provide Unpaid Leave as an Accommodation Under the ADA

Recent amendments to the Americans with Disabilities Act (ADA) dramatically expanded the
class of persons considered to be “disabled” under that law. Those amendments did not change
the law governing the nature of the accommodations employers are obligated to provide to
employees with disabilities. Employers should be aware, however, of the EEOC’s increasing
focus on the obligation to provide unpaid leave as an accommodation under the ADA.

In recent years, the EEOC has filed a series of lawsuits against large employers alleging that they
violated the ADA by failing to provide employees with reasonable accommodations in the form
of time off from work.

In January 2011, the EEOC announced a $3.2 million settlement in the case of Supervalu, Inc.,
American Drug Stores, LLC, and Jewel Food Stores, Inc. The employers in that case had a
policy of automatically terminating employees who were unable to return to work after a one-
year disability leave. In addition, employees returning from a medical leave were required
to show that they were free of any physical or mental restrictions. In addition to making a
substantial payment to settle the case, the defendants were required to take steps to ensure future
compliance with ADA, including ensuring that decisionmakers underwent ADA training, the
submission of regular reports to EEOC and the hiring of consultants to review and recommend
changes to job descriptions and to make recommendations as to reasonable accommodation
issues.

In September 2011, the EEOC announced a similar settlement with Verizon Communications.
The EEOC alleged that Verizon maintained a “no fault” attendance policy under which
employees were disciplined for exceeding limits on “chargeable absences.” The policy had no
exceptions for absences caused by ADA-covered disabilities. Verizon ultimately agreed to settle
the case by paying $20 million to a nationwide class of employees.

In addition, in June 2011, the EEOC held a public hearing on the issue. The EEOC emphasized
that employers should not maintain inflexible leave of absence policies that provide for the
automatic termination of employment when an employee is unable to return to work at the end of
a specified maximum leave period. This issue often arises when employees exhaust the twelve
weeks of leave provided under the Family and Medical Leave Act (FMLA). In such cases,
employers must determine whether it would be reasonable to provide additional time off under
the ADA. It should also be noted that in some cases, employees may be “disabled” under the
ADA, and therefore entitled to time off from work, even if they do not qualify for FMLA leave.

The EEOC also emphasized that the appropriate length of leave under the ADA requires
an “individualized” analysis, even if the employer provides a substantial amount of disability
leave as a matter of course. Further, the EEOC noted that employers risk liability under the
ADA where they outsource leave administration functions, such as the administration of
worker’s compensation benefits or disability benefits. In such cases, the employer may lose
sight of its obligation to provide time off under the ADA. Finally, the EEOC emphasized the
need to engage in an “interactive process” with employees seeking accommodations.
Like most ADA accommodation issues, the extent of an employer’s duty to provide time

off from work depends on the facts and circumstances of the particular case. Thus, it may
be “reasonable” for an employer to provide an unpaid leave in excess of one year when it can
readily fill the position and would experience no “undue hardship” from providing additional
time off. Whether an accommodation would impose an undue hardship depends on all of the
facts. Courts have also held that the requested leave must not be open-ended or “indefinite”
nature.

The obligation to provide time off as an accommodation is one of the most complex issues
employers are likely to face under the ADA. Employers should ensure that they do not maintain
inflexible leave policies. When in doubt, employers should consult with legal counsel.