The rigid application of policies limiting the amount of leave employees can take does not insulate employers from liability under the Americans with Disabilities Act. Policies which provide for termination after an employee exhausts a predetermined amount of leave, such as nine months or one year, must be administered consistent with the reasonable accommodation requirements of the ADA.

A $6.2 million settlement, approved yesterday between Sears and the Equal Employment Opportunity Commission, demonstrates the importance of the above point. The settlement resolved a class action lawsuit in which the EEOC alleged that Sears violated the ADA through an “inflexible” policy of terminating injured employees who exhausted their workers' compensation leaves rather than seeking to return them to work. According to the EEOC, Sears terminated hundreds of employees who exhausted their available leave without “seriously considering” whether a short extension of leave or a reasonable accommodation would enable them to return to work.

As part of the settlement, Sears agreed to make policy changes that include notifying employees, at least 45 days before their leaves expire, of their right to ask for accommodations that would enable them to return to work. Sears’ revised policy will also provide examples of potential accommodations such as reassignment, additional leave and light duty work. In addition, Sears is creating a “centralized leave management team” to assist with accommodation-related issues.