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A federal appeals court ruling that allows employers to set rigid disability leave guidelines is the first to bump directly against a U.S. Equal Employment Opportunity Commission campaign that promotes more flexible policies for injured or ill workers.
Many employers have already adjusted their leave policies in response to the EEOC's efforts since at least 2009 that support flexible disability leave policies, experts say.
They recommend that despite the ruling by the 10th U.S. Circuit Court of Appeals in Denver in Grace Hwang v. Kansas State University, employers that already have flexible policies should stand pat, at least for now.
In this case, Ms. Hwang signed a one-year contract to teach classes in the fall, spring and summer academic terms at Kansas State University. But before the fall term began, she learned she had cancer. She sought and received a six-month leave from the university to undergo treatment.
On her doctor's advice as the end of the leave neared, Ms. Hwang asked for an extension of her leave, but the university refused and said it had an inflexible policy that allowed no more than six months' leave.
Ms. Hwang sued, alleging the university violated the Rehabilitation Act, the equivalent of the Americans with Disabilities Act for publicly funded entities.
A Wichita, Kansas, federal judge dismissed the case, which a three-judge panel of the 10th Circuit upheld unanimously in a late May ruling.
An employee incapable of working more than six months “isn't an employee capable of performing a job's essential functions,” the appeals court ruled. Requiring an employer to keep a job open for so long “doesn't qualify as a reasonable accommodation.”
While Ms. Hwang alleged the university's policy is inherently discriminatory, the appeals court disagreed.
“To the contrary, in at least one way an inflexible leave policy can serve to protect rather than threaten the rights of the disabled — by ensuring disabled employees' leave requests aren't secretly singled out for discriminatory treatment, as can happen in a leave system with fewer rules, more discretion and less transparency,” the appeals court ruled.
Ms. Hwang's attorney, Luanne C. Leeds of Leeds Law L.L.C. in Topeka, Kansas, said she has requested a rehearing before the full appeals court.
The EEOC had no comment on the ruling.
Debbie Norris, vice president of human resources at Greenwood Village, Colorado-based Merrick & Co., said, “We'll be taking a look at our own policies” for the engineering and architectural design and consulting firm's 500 employees in 18 offices as a result of the appeals court ruling.
“We have gone beyond what is probably required,” which “makes it really difficult to run a business if you have people on leave for a year,” Ms. Norris said. “I actually welcome this direction” from the 10th Circuit Court.
While other appeals courts have ruled that a maximum of six months of disability leave is reasonable, “this goes one step further and says there is a time period” of six months, beyond which such leave is too long, said Darren E. Nadel, a shareholder at law firm Littler Mendelson P.C. in Denver.
The ruling reflects an understanding of “the practicalities of the work world when it came to the conclusion that six months is a reasonable amount of time to hold jobs open,” said Judith Biggs, a partner at Holland & Hart L.L.P. in Denver.
“It's an interesting decision because the conventional wisdom,” given the EEOC's stance, is that “employers shouldn't maintain rigid leave polices” and “have an obligation under the ADA to engage in the interactive process to determine whether or not leave is a reasonable accommodation,” said Jonathan T. Hyman, a partner at Kohrman, Jackson & Krantz. P.L.L. in Cleveland.
Some experts think the ruling will be influential.
It will give other appeals courts “something to point to and to recognize” that a six-month leave limit can be considered reasonable, Ms. Biggs said.
It is too soon to say whether the U.S. Supreme Court will take up the matter, because experts say there is no clear split on the issue among the appeals courts.
For now, experts advise employers that already have flexible disability leave policies to keep them.
“It's always a smart move” to evaluate any employee request, even if it is turned down later, Mr. Nadel said.
The U.S. Equal Employment Opportunity Commission has reached several settlements with employers over disability leave policies that allegedly violated the Americans with Disabilities Act. Among them are: