You may be asking yourself, hey, I am a small business with just a handful of employees, I know that I am not covered by federal law, so why should I bother with a leave policy? Not a bad question, but one that does not realize how such a policy can help you when you face an employee that may be lingering on worker’s compensation.
A Leave Policy is a set of rules, procedures, and guidelines that govern the process, timeframes and reporting procedures for the time taken off work.
Leave, or time off, policies determine the type – if you provide paid time off – and amount of time that can be taken off work, how such time will be reported and paid, if paid or unpaid time off is to be used first, and the process for requesting time off. Without a leave policy, effectively and legally managing a workforce becomes a minefield fraught with high risk.
It’s no easy task keeping track of the various federal, state, and even local laws governing employee leave. When drafting a leave policy for your workplace, it is vital that you understand these laws and how they interact with one another. For instance, did you know that having a leave policy in place that is uniformly enforced can provide a defense under certain situations when someone is terminated for being gone too long while being treated under a worker’s compensation claim?
While no Texas or federal law requires private-sector employers to provide paid leave of any kind, you do need to be aware that certain federal laws do require unpaid leave, no matter how large or small your business. For instance, the Unformed Services Employment and Reemployment Rights Act (USERRA) applies to all employers regardless of size, and requires the employer, with very minor exceptions, to reinstate an employee who was activated and deployed, or participates in normal or emergency drill. Conversely, the Family and Medical Leave Act (FMLA) only applies to those employers with 50 or more employees stationed within 75 miles of the employee who is to take such leave.
From a state perspective, in Texas, if you provide paid time off through an established policy – and if you do not have a written policy and are providing paid time off you just opened Pandora’s Box from a potential liability perspective – your paid time off policy is subject to the provisions of Texas Payday Law.
As you can see, whether you offer paid or unpaid leave, best practices from an employer perspective dictate setting forth your policy in a written format, having some mechanism in place that acknowledges that the employee has read and understood the policy, and, most importantly, uniformly enforcing that policy.
Wait a minute, you may be thinking, I thought that a written policy could be used as a form of an employee contract? As with most legal issues, that answer is a definite maybe. Yep, that typical lawyer response – it could or could not form the basis of a contract in Texas, while in some other states – yes, I mean you California – the policy can be considered a contract. This simple fact should NOT prevent you from devising a clear, concise and uniformly enforced written policy. There are many more circumstances where clear policies and procedures prevent liability in Texas, and in many other states.
For instance, a recent case in Texas, Kingsaire, Inc. v. Melendez ___ S.W.3d ___, 2015 WL 7950716 (Tex 2015), provides a great example as to how a uniform leave policy can provide a defense to a retaliation claim by someone that is not able to work because of a worker’s compensation claim. In a nutshell, an employer followed their medical leave policy in a uniform matter when discharging an employee that was out because of a work-related injury. That employee sued claiming retaliatory discharge. The Texas Supreme Court held that because the employer uniformly applied its policy to the employee in question and similarly situated employees, a retaliation claim under the Workers’ Compensation Act was not appropriate. While there were some factual nuances, the Texas Supreme Court focused on three key factors: 1) was there a written policy; 2) did the employee know of that policy; and 3) was that policy uniformly applied to both the employee in question and other similarly situated employees.
For Texas employers, the Kingsaire, Inc. case is a huge win and it underscores the need for your company to maintain carefully drafted, documented and uniformly enforced leave policies. Even if you do not provide paid time off, your company’s leave policies need to address the issues of family medical leave, bereavement, jury duty, military leave, time off for court cases and voting. Something else that is worth covering in the leave policy is holiday leave. For those employers that do provide paid time off, you also need to address what gets used first – paid time off or unpaid leave – along with setting forth how paid time off is accrued, and if any of it can be carried over from one year to the next. Lastly, you need to ensure that all employees sign an acknowledgment indicating that they read, understood, and received a copy of the leave policy and that you keep a copy of the acknowledgment in their personnel file.
As you can see, a written leave policy can provide an ounce of prevention when it comes to dealing with employees. Yes, it does require some effort both in creating the policy and uniformly enforcing it; however, the potential liability shield that it provides will more than pay for itself should you ever face a disgruntled employee.
If you are in need of counsel regarding such matters, then please contact me today.