SAN FRANCISCO — Employers may want to think twice before adopting leave policies that are unlimited or that attempt to comply with several state and local laws at once, attorneys said during a panel at the American Bar Association Section of Labor and Employment Law's annual conference last week.
Sick leave legislation is still largely a function of state and local governments, Franczek Radelet partner Jeff Nowak said. Efforts by the Trump administration to provide paid maternity leave at the federal level apparently by reigning in unemployment insurance and associated fraud were not fulfilled, as has been the case with leave bills introduced in Congress.
Instead, states have passed leave laws covering childbirth, adoption and other situations like organ donation and crime victim leave. "There doesn't seem to be any rhyme or reason as to how these smaller-type laws get on the books," Nowak said. So employers looking to get ahead of the many leave laws out there may try to craft one organization-wide policy that provides more generous leave than all of those regulations.
"Do we create one policy for everyone? Is that doable? In my experience, most likely not," Nowak said. "Think about all the leave laws that we have to coordinate at the state, city and county level. It's a virtually impossible task to pull all of that together and follow each of those individual laws."
The different laws may have caps on how employees accrue leave in a given year, or how employers pay for the time off. Some laws provide for "safe" or domestic violence leave, while others don't. And even the legal definitions used — who is or isn't considered a "family member," for example — can vary.
"I've had one or two clients actually do it, but it is kind of rare for that large company to provide that policy across all of the borders," Nowak said.
Time to go unlimited?
The concept of unlimited vacation has risen in popularity due in part to adoption by tech companies like Netflix. It's perhaps one way to confer trust on employees and allow them to manage their own time.
Nowak said there are pros to the approach: for example, remote work and telecommuting are a growing feature of some jobs, and allowing workers to flex their schedules can make sense in this context.
"The problem with it is how do we decide when the employee has used too much time off — my clients struggle with that," Nowak said. "At what point is time off far too excessive. How do you coordinate that time with FMLA? … You couldn't lawfully have a policy that says 'our employees are allowed to take unlimited leave, but for the employee on FMLA, you can only take two weeks of paid leave.' That's clearly a problem."
Instead, employers can limit all leaves to a certain period of time, Nowak said, though that basically puts them back into the category of employers offering set amounts of leave. Another method might be to differentiate between unlimited paid time off and unlimited vacation policies.
'Bonding' and 'recovery' phrasings make a difference
Can you treat mothers and fathers differently under parental leave policies? Nowak pointed to a 2018 lawsuit by the U.S. Equal Employment Opportunity Commission (EEOC) against Estée Lauder in which the company denied bonding time to a male employee equal to the amount of bonding allotted to female employees.
Estée Lauder settled, changing its policy before settling with EEOC, giving six to eight weeks of recovery time to new mothers and 20 weeks of paid "bonding" time to both sexes.
"You can treat moms better than dads in one situation: when we're talking about recovery period," Nowak said. "In that six- to eight-week period of time after childbirth, you can treat mom differently than dad." That's supported in EEOC's 2014 pregnancy discrimination guidance, he noted. "Include that in your policy … that period of time, that leave of absence that's only given to women … make sure that's tied to a recovery period." And outside of this, employers can craft eligibility requirements as they wish, Nowak said.
Also, it's unwise to assume that an employee needs to take maternity leave, the panel said. Doing so could set an employer up poorly in its effort to defend against adverse action claims brought under Title VII.
"It doesn’t matter whether it's evil or nefarious reasons or you mean well," said Lisa Demidovich, partner at Bush Gottlieb. "It's really important to not make assumptions about what people want … treat everyone the same and open it up and see what makes sense, because it can lead to a lot of problems within an organization."