As a small business owner with just a few employees, you may not have the world’s clearest leave policy. You may think to yourself, “my workers accrue PTO at a reasonable rate, isn’t that enough?” And for a short time, that might be fine…until something goes wrong.
The truth is, it’s not enough to just have some PTO. Even though you’re not covered by federal law with only a few employees, a loose leave policy—or not having one at all—can pose a serious threat to the livelihood of your business. What happens when one of your employees becomes pregnant? Or your only electrician has a death in the family? And how do these situations differ from your part-timer who suddenly goes on a two-moth trip to Barbados?
A strong leave policy determines how much time your employees can take off, and when, and whether you’ll pay them while they do so—if at all. Without such a document, or without processes and policies for every situation defined within, you’re opening yourself to a world of risk. And while investing in a strong leave policy up front may sound like a lot of work; it will pay dividends when it protects you from a potential lawsuit.
These are just a few of the types of leave it’s essential to include or address in your leave policy:
Civic Duty Leave
Civic duty can cover issues like jury duty, court appearances, and voting. Jury duty is job protected leave, but in the state of Texas does not necessarily have to be paid except in certain circumstances. Including a section in your leave policy that addresses these events would be wise for a business of any size.
Employers must provide leave to employees with military obligations under The Uniformed Services Employment and Reemployment Rights Act (USERRA) no matter how large, or small, your business. This act mandates that employers allow an employee who is a uniformed servicemember to return to their job after they return from military service or training.
Family Medical Leave
Family medical leave is covered by the Family and Medical Leave Act (FMLA). This act requires you grant employees up to 12 weeks of unpaid leave each year for specific health and family reasons, like birth, death, adoption, and more. FMLA requirements for small business under 50 employees will vary, so if you chose not to offer FMLA benefits, make sure that your business is really exempt.
Something to consider: if you are not required to provide FMLA-type leave because you do not have enough employees, offering something along the lines of FMLA leave may help you attract and retain high-performing employees in this tight job market.
Paid Time Off (PTO)
Not that long ago, businesses would offer a combination of vacation time, and sick time – two separate buckets of time from which an employee could receive compensation when not at work. Over the years, employers realized that employees were using “sick time” as a substitute for vacation time, yet, because it was “sick time” that was accrued, there was nothing that could be done. Combine that with the advent of HIPPA laws, and the privacy folks have concerning medical issues, and employers found themselves in a bit of a bind.
Today, the best practice is to simply offer Paid Time Off (PTO), as opposed to vacation time and sick time. There is one bucket of hours from which an employee can draw from, whether they are sick or taking a vacation. This relieves the employer from having to track two separate buckets of potential compensation, avoids potential HIPPA issues, and does away with the wink-wink nod-nod issue of employees taking sick time for a vacation.
While neither Federal law, nor Texas law, requires and employer to provide PTO, vacation time, or sick time, such a benefit can be a powerful recruiting tool in today’s tight job market. Furthermore, should you decide to grant PTO, or sick time, or vacation time, it is imperative that you draft, and follow, a comprehensive policy as to how much time is accrued, if you will pay that accrued time when someone’s employment ends voluntarily or involuntarily, and notice requirements to use PTO when practical.
In the State of Texas, employers are not required to have workers’ compensation coverage—however doing so leaves your business unprotected from personal injury lawsuits. If your business is insured, then if an employee is injured while at work, they may be eligible for workers compensation. If the injury is severe, they may even have to miss work until they have fully recovered. When this is the case, the worker may be eligible for paid and protected time off.
For Texas employers, a written leave policy that covers all possible types of leave can provide essential liability protection. You’ll want to ensure that there’s little room for interpretation, should a lawsuit arise, in order to protect yourself and your business. And in the long run, your employees will thank you for setting clear expectations up front and not being shy about making that information handy and available.
Need help crafting a solid leave policy? Contact my office today.