Inflexible Leave Policy Litigation: Stretching the limits of the ADA

By Colin Hunter Hargreaves

0420-SickLeaveFilesInflexible leave policy litigation is nothing new. In fact, this niche area has been on many people’s radar for a while now, especially that of the Equal Employment Opportunity Commission (EEOC). Throughout the past decade, EEOC has repeatedly made litigating these policies a priority.1 Yet despite the EEOC’s emphasis on reducing inflexible leave policies, and in the wake of numerous class action cases, these leave policies still appear regularly. Inflexible leave policy litigation remains an area of law infrequently discussed by scholars and experts. This article provides a brief overview of recent developments.

Part I will present some examples of inflexible leave policies and provide additional context regarding facially neutral, but potentially unlawful, inflexible leave policies. Part II will discuss the legal framework and recent developments in case law on this novel and rapidly developing area. Part III distills key takeaways. 

Part I: Context

Inflexible leave policies2 are facially neutral and seemingly non-discriminatory policies that employers implement to control the amount of time their employees are out of work. This appears to make sense, since any employer would want to limit employees’ time away from work and ensure that they return as soon as possible. But there are inherent issues with such policies, since they may unintentionally discriminate against employees with disabilities who need an accommodation. 

Indeed, the EEOC has taken the position that any such inflexible leave policy violates the Americans with Disabilities Act (ADA) because the policies do not allow for an “individualized assessment” of an employee’s disabilities.3 Nor do they allow the federally mandated interactive process to occur; in fact, such policies chill any attempt to engage in it. Any policy that seemingly prohibits an employer from taking into account the highly individualized and unique nature of each individual’s disability may open up organizations to liability.

In practice, though, it is not as simple as that. Facially neutral inflexible leave policies take many forms. One common example: An employer implements a policy requiring termination of any employee who is  Sunable to return to work after exhausting their leave under the organization’s policies, the Family and Medical Leave Act, a previous ADA leave, short-term disability, workers’ compensation leave, or something similar. A second example occurs when an employee returns to work but is prohibited from taking an additional brief medical leave shortly after returning due to side effects of a medication, recurrence of symptoms, complications from a procedure, etc. A third example happens when an employer implements a policy requiring an employee to be “100 percent healthy” before returning to work. By way of illustration, the following hypothetical pulls all three of these scenarios into one unfortunate policy.

Acme, Co. Disability, Medical, and Leave of Absence Policy

EMPLOYER will provide all EMPLOYEES up to, but not in excess, of 100 days of disability, medical, and/or for any other such leave of absence that are related to any qualifying illness in accordance with federal disability leave statutes. If after 100 days, EMPLOYEE is unable to return to work at full (100%) health, without any restrictions, EMPLOYER will terminate EMPLOYEE’S employment and allow EMPLOYEE to re-apply for a vacant position upon stabilization of their condition.

Acme’s policy, like the examples cited above, is fatally inflexible for a variety of reasons. First, the policy does not take into account the unique nature of each employee’s disability through an “individualized assessment.” Second, it does not allow an employee to request an accommodation (such as another brief medical leave or other work modifications). Third, the policy effectively terminates an employee with a disability who may be able to return to work with an accommodation or return in a different, but similar, role. Fourth, the policy requires an employee to reapply for a vacant position, instead of being placed in that position.4 To understand why facially neutral non-discriminatory policies may violate the ADA, it is best to understand the underlying law.

Part II: Legal primer

The ADA and its various state equivalents prohibit discrimination based upon an individual’s disabilities.5 Included in this prohibition is the obligation for an employer to engage in an “interactive process” to provide reasonable accommodations to assist with an employee’s known disabilities.6 A reasonable accommodation means, inter alia, making the employer’s facilities readily accessible for an individual with disabilities, providing a restructuring of the job, modifying the employee’s work schedule, reassigning the employee to a vacant position, or providing other equipment or devices that will aid the employee’s return to work.7 

Under the ADA, discrimination includes “using qualification standards, employment tests, or other selection criteria that screen out or tend to screen out an individual with a disability or a class of individuals with disabilities...”8 This definition includes “utilizing standards, criteria, or other methods of administration that have the effect of discrimination on the basis of disability.”9 This is where many inflexible leave policy claims derive from and get their teeth. The EEOC summed it up perfectly when it stated (in reference to inflexible policies):

The ADA requires that employers make exceptions to their policies, including leave policies, in order to provide a reasonable accommodation. Although employers are allowed to have leave policies that establish the maximum amount of leave an employer will provide or permit, they may have to grant leave beyond this amount as a reasonable accommodation to employees who require it because of a disability, unless the employer can show that doing so will cause an undue hardship.10

Note that an employer is relieved of its obligation if the requested accommodation poses an “undue hardship” on the employer’s business.11 An accommodation is an “undue burden” if the employer incurs a “significant difficulty [in providing the accommodation] or expense.”12 Some factors to consider in determining whether a given accommodation is an “undue hardship”: the cost of the accommodation, the financial resources of the employer compared to the cost of the accommodation, the size of the business, the number of employees employed by the employer, the impact of the accommodation on the employer’s facilities, etc.13

For years now, the EEOC has taken the absolute position that any inflexible leave policy violates the ADA. The EEOC even listed inflexible leave policies as one of the issues of concern in its recent Strategic Enforcement Policy.14 This in turn led the EEOC to file various lawsuits alleging, in part, that the inflexible leave policies violated the ADA because the employer did not engage in an interactive process.15 

EEOC cases

Throughout the 2000s and 2010s, the EEOC has litigated dozens of cases related to inflexible leave policies. The EEOC’s pursuit has led to numerous lucrative settlements, ranging from five figures all the way up to $20 million.16 The potential for class action lawsuits or high settlements should concern employers. Three cases are particularly illustrative of the jurisprudence:

First, in EEOC v. Sears Roebuck and Co.,17 an employee injured on the job took workers’ compensation leave for an extended period. The employee tried to return to work but was unsuccessful after Sears failed to provide any accommodations or avenues for his return and then terminated him at the end of his leave in accordance with Sears’ workers’ compensation exhaustion policy. While this case started as a charge from a single employee, it evolved into a class action after pre-trial discovery revealed that hundreds of other employees were similarly terminated under the policy. The case eventually resolved for $6.2 million, with the added requirements that Sears must “provide written reports to the EEOC detailing its workers’ compensation practices’ compliance with the ADA, train its employees regarding the ADA, and post a notice of the decree at all Sears locations.”18

In EEOC v. Verizon Comms.,19 the EEOC contended that Verizon maintained attendance policies that penalized employees who had reached a specific threshold of “chargeable absences.” After a certain amount of “chargeable absences,” an employee faced increasingly severe disciplinary steps that resulted in punishment and ultimately termination. The EEOC filed a lawsuit against Verizon after receiving 40 individual charges. The parties ultimately settled for a staggering $20 million, and the settlement further prohibited any additional discrimination, mandated revision of the company’s attendance policies, and required Verizon to: provide training on the ADA; report all complaints of disability discrimination relating to its attendance plans to the EEOC; post notices about the settlement; and appoint an internal monitor to ensure future compliance. Interestingly, the EEOC director of the Philadelphia District Office, Spencer H. Lewis. Jr., said, “This settlement demonstrates the need for employers to have attendance policies which take into account the need for paid or unpaid leave as a reasonable accommodation for employees with disabilities.”20

Finally, in the recent EEOC v. Nevada Restaurant Servs.,21 the EEOC brought suit against the company for maintaining a well-established companywide requirement that employees with disabilities (or those with medical conditions) be “100 percent” healed before they were allowed to return to work. In addition, the EEOC found that the company further forced employees to resign due to their disabilities or their association with individuals with disabilities. The EEOC argued that such policies “do not allow for engagement in an interactive process or providing a reasonable accommodation for disabled employees.” The lawsuit settled for $3.5 million, along with added requirements that the company retain an ADA consultant to review the company’s policies, implement ADA training, develop a centralized tracking system for employee requests for disability accommodations, and submit regular reports to the EEOC to verify compliance.22

These examples showcase just how significant these claims can be. Not only are these cases reaching lucrative multi-million-dollar settlements; there are numerous additional costs associated with the settlements, including employing compliance monitors, paying counsel for drafting new policies, diverting staff resources to reporting information to the EEOC, and opening the company to significant future liability. 

Hwang v. Kansas State University

Yet despite the EEOC’s unflinching position that all inflexible policies are unlawful, not all courts agree with them. Most notably, the 10th Circuit’s decision in Hwang v. Kansas State University23 provided some clarification on this rapidly growing area of litigation.

In Hwang, now-Justice Gorsuch wrote for the plurality, holding that a leave of absence extending longer than six months was not a reasonable accommodation under the Rehabilitation Act.24 Gorsuch reasoned that since Hwang was unable to return to work, she was unable to perform the essential functions of her job.25 Furthermore, the opinion reasoned that since an accommodation’s main purpose is to get the employee back to work, such extended leave was not reasonable.26 Though many thought this was dispositive, Gorsuch provided a carve-out, stating “This isn’t to suggest inflexible leave policies are categorically immune to attack.”27 This contention seems to be supported in other subsequent decisions as well.28 Thus, this opinion appears to have been decided on narrow grounds since Hwang wasn’t able to perform her job—at all, even with the help of any reasonable accommodations—and her return was up in the air even after her most recent request for an additional medical leave.29

Thus, this decision appears to be factually specific with a narrow scope, which makes sense considering the EEOC’s continued efforts following the Hwang decision. Nevertheless, other circuits have touched on similar issues (inflexible leaves and/or unusual accommodations) and have generally supported Hwang with similarly narrow holdings. 

Part III: Takeaways

While there remain some ambiguities regarding current jurisprudence and the legality of inflexible leave policies (at least until more circuits weigh in), there are nevertheless some key takeaways for employers and scholars to glean from past and present litigation.

  • First, any type of leave policy that is restrictive or inflexible and sets a maximum duration for any type of leave (even if it exceeds the required amount of leave under the law) is inherently suspect under current precedent. If there are any doubts, have an employment lawyer review your policies.
  • Second, look at each situation individually and determine a given employee’s needs. This is important because a one-size-fits-all application of facially neutral policies may not adequately envision a person’s limitations or disabilities. 
  • Third, enter into the interactive process to determine what accommodations, if any, an employee needs to return to work. For example, the EEOC stated, “If an employee with a disability needs additional unpaid leave as a reasonable accommodation, the employer must modify its ‘no-fault’ leave policy to provide the employee with the additional leave, unless it can show that: (1) there is another effective accommodation that would enable the person to perform the essential functions of his/her/[their] position, or (2) granting additional leave would cause an undue hardship.”30 
  • Fourth, it is always a good practice to document all attempts and communications to engage in the interactive process.
  • Fifth, stay updated. As more circuits encounter this issue, it could develop rapidly — especially if the Supreme Court eventually weighs in.

COLIN HUNTER HARGREAVES is a labor & employment and litigation attorney at Felhaber Larson, P.A. based in Minneapolis, Minnesota. He focuses his practice on representing organizations and employers in labor & employment, commercial class actions, and general litigation matters. Colin received his JD from the University of St. Thomas School of Law, where he was a regular on the Dean’s List and participated on two of the school’s moot court teams.


1 Equal Employment Opportunity Commission, U.S. Equal Opportunity Commission Strategic Enforcement Plan Fiscal Years 2017-2021 (Sept. 2017), https://www.eeoc.gov/eeoc/plan/sep-2017.cfm 

2 Also called “maximum leave policies” or “no fault” policies.

3 Equal Employment Opportunity Commission, Employer-Provided  Leave and the Americans with Disabilities Act (5/9/2016), https://www.eeoc.gov/eeoc/publications/ada-leave.cfm#_edn8 

4 See Equal Employment Opportunity Commission, EEOC’s Revised Enforcement Guidance: Reasonable Accommodation and Undue Hardship Under the Americans with Disabilities Act (10/17/2002), www.eeoc.gov/policy/docs/accommodation.html 

542 U.S.C. §12112(a).

6 42 U.S.C. §12112(b)(5).

7 29 U.S.C. §12111(9)(A)-(B). 

8 42 U.S.C. §12112(b)(6).

9 42 U.S.C. §12112(b)(3).

10 See supra Note 4.

11 42 U.S.C. §12112(b)(5)(A).

12 29 C.F.R. §1630.2(p)(1).

13 29 C.F.R. §1630.2(p)(2)(i)-(v).

14 See supra Note 2.

15 See infra Note 16-25.

16 See, e.g., EEOC v. Denny’s, Inc., No. WDQ-06-02527 (D. Md. 9/26/2006) ($1.3 million settlement after defendant refused to let employee return to work with an accommodation and maintained policy that automatically denied employees additional medical leave); EEOC v. Supervalu, Inc., No. 09 CV 5637 (N.D. Ill. 9/4/2009) ($3.2 million settlement after defendant automatically terminated employees after set amount of medical leave); EEOC v. JP Morgan Chase & Co., No. 2:09-cv-00864 (S.D. Ohio 9/29/2009) ($2.2 million settlement after defendant did not accommodate employees released to return to work and terminated after six months without accommodating); EEOC v. Princeton Healthcare Sys., No. 10-4126 (D.N.J. 8/11/2010) ($1.35 million settlement for maintain fixed leave policy that failed to consider leave as a reasonable accommodation); EEOC v. United Parcel Service, Inc., No. 09-cv-5291 (N.D. Ill. 9/10/2010) ($2 million settlement after defendant maintained inflexible leave policy which terminated employees after 12 months of leave without engaging in interactive process); EEOC v. Interstate Distributer Co., No. 12-cv-02591-RBJ (D. Colo. 9/28/2012) ($4.85 million settlement after defendant maintained policies that automatically terminated employees after 12 weeks of leave, as well as requiring employees to return without any restrictions); EEOC v. Doumak, Inc., No. 14-cv-7492 (N.D. Ill. 9/26/2014) (settlement of $85,000 after defendant capped any leave without providing any reasonable accommodation); EEOC v. Groendyke Transport, Inc., No. 3:19-cv-02830-RV-EMT (N.D. Fla. 7/29/2019) (lawsuit alleges that defendant terminated employees after exhausting FMLA leave when employees were almost ready to return to work, but needed a little more time)

17 EEOC v. Sears Roebuck & Co., No. 04 C 7282 (N.D. Ill. Nov. 2004).

18 Equal Employment Opportunity Commission, Sears, Roebuck to Pay $6.2 Million For Disability Bias (9/29/2009),  https://www.eeoc.gov/eeoc/newsroom/release/9-29-09.cfm 

19 EEOC v. Verizon Comms., No. 1-11-cv-01832-JKB (D. Md. 7/5/2011).

20 Equal Employment Opportunity Commission, Verizon to Pay $20 Million to Settle Nationwide EEOC Disability Suit (7/6/2011), https://www.eeoc.gov/eeoc/newsroom/release/7-6-11a.cfm 

21 EEOC v. Nevada Restaurant Servs., No. 2:18-cv-00954-JCM-CWH (D. Nev. 5/28/2018). 

22  Equal Employment Opportunity Commission, Nevada Restaurant Services to Pay $3.5 Million to Settle EEOC Disability Discrimination Lawsuit (6/6/2018), https://www.eeoc.gov/eeoc/newsroom/release/6-6-18c.cfm 

23 753 F.3d 1159 (10th Cir. 2014).

24 29 U.S.C. §701, et seq. Like the Americans with Disabilities Act, the Rehabilitation Act also prohibits discrimination with respect to entities that receive federal funds. Since the two are functionally identical, they are analyzed in the same manner as ADA claims.

25 Supra note 25 at 1161-62 (10th Cir. 2014).

26 Id. at 1162.

27 Id. at 1162.

28 Echevarria v. AstraZeneca Pharmaceutical LP, 856 F.3d 119, 131 (1st Cir. 2017) (stating, in dicta, that there is a reasonableness element to accommodations and it is a case-specific inquiry); Dalton v. Subaru-Isuzu Automotive, Inc., 141 F.3d 667, 679 (7th Cir. 1998) (stating, in dicta, that blanket “no transfer” policies “would remain subject to challenge both for any disparate impact it might impose on disabled employees, and for any unreasonable inflexibility in the face of a demand for reasonable adjustments to accommodate a disabled candidate for transfer).

29 This narrow holding was seemingly supported in Severson v. Heartland Woodcraft, Inc., after the court held that long-term leave of absences are not reasonable accommodations. See generally Severson v. Heartland Woodcraft, Inc., 872 F.3d 476 (7th Cir. 2017) (stating, “But a medical leave spanning multiple months does not permit the employee to perform the essential functions of his job. To the contrary, the ‘[i]nability to work for a multi-month period removes a person from the class of protected by the ADA.’”).

30 EEOC, No. 915.002, Enforcement Guidance: Reasonable Accommodation and Undue Hardship Under the Americans with Disabilities Act (2002), available at 2002 WL 31994335, at *15.