Employment Law Update

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EEOC Turns Focus To “No Fault” Leave Policies: Verizon Pays $20 Million Dollars To Settle ADA Lawsuit

A prior Alert discussed the EEOC’s enforcement efforts targeting inflexible leave policies under which employees on a disability leave face termination if they do not return to work within a year or other specified period. The agency has now turned its attention to so-called “no fault” or “neutral” absence policies, under which employees face progressive discipline and eventual termination once they accumulate a designated number of days off work. Absences are counted under the policy regardless of the reason, even if the absence is due to a condition that qualifies as a disability under the Americans With Disabilities Act (ADA).

Earlier this Summer, the EEOC obtained a $20 million dollar settlement (its largest ADA settlement to date) against Verizon, arising out of the company’s “no fault” attendance policy. Like many companies, Verizon’s attendance policy provides multiple steps of discipline, up to discharge, for all employee absences other than those covered by the Family and Medical Leave Act. Once an employee accumulates a specified number of “chargeable absences,” he/she is placed on a disciplinary step and additional absences during that step period result in placement of the employee in the next disciplinary step. The EEOC filed a class-action lawsuit in Maryland’s federal court alleging that Verizon’s no fault policy violates the ADA because it makes no exception for employee absences attributable to disabilities.

The EEOC asserted in the suit that an employee who needs leave from work because of a disability must be granted the leave as an accommodation unless granting leave to that particular employee creates an undue hardship for the employer. Moreover, the leave must be allowed without penalty under any “no fault” policy or other employer practice because the ADA prohibits penalizing employees based on their need for an accommodation.

Recent amendments to the ADA expanded the definition of “disability” to include many conditions not previously protected under the law. As a result, an increasing number of employee absences may be due to protected disabilities, making it more important than ever to understand the EEOC’s aggressive position on leave and absenteeism policies.

While it is possible that the courts will ultimately reject the EEOC’s position on no fault policies, it is clear that the agency (and, likely, the state and local discrimination agencies which usually follow the EEOC’s lead), considers the undifferentiated application of such policies to disabled and non-disabled employees to be unlawful.

Employers with a “no fault” policy or similar practice should modify the policy, or modify how they implement the policy, to take into account whether an employee’s absence is due to a disability. To avoid running afoul of the federal, state and local discrimination laws, it is important that employers educate their human resource staff and supervisors on the ever-evolving parameters of the ADA and the requirements of the accommodation process.

If you need help with an ADA situation, evaluating your polices or educating your staff, contact:

Chuck Bacharach, 410-576-4169 or Bob Kellner, 410-576-4239


September 12, 2011




Bacharach, Charles R.
Kellner, Robert C.