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Updated Mar 29, 2023

Employer’s Guide to Disability Leave

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Kiely Kuligowski, Staff Writer

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What happens when one of your employees is pregnant or becomes injured or seriously ill and won’t be able to perform their job for an extended period? Two federal laws, the Americans with Disabilities Act (ADA) and the Family and Medical Leave Act (FMLA), regulate how employers must handle these situations. Some states have additional laws regarding disability leave. 

We’ll explore disability leave, who’s covered and what responsibilities business owners have when employees qualify for disability leave. 

What is disability leave?

Disability leave is a leave of absence granted to employees who can’t perform their job functions due to a physical or medical condition or temporary disability, with or without reasonable accommodations. 

Disability leave doesn’t count as paid time off (PTO). Instead, it’s an approved absence provided as an accommodation. 

Did You Know?Did you know

Any injuries or illnesses that occur on the job are typically covered by workers’ compensation, not disability.

How do the ADA and FMLA govern disability leave?

Employees may become entitled to disability-related leave under the FMLA and ADA. There are distinct differences between the two federal laws. 

“The main difference between FMLA and a disability leave is the compensation,” explained Lewis Mayhew, CEO and founder of South Scaffolding. “FMLA-eligible employees are not paid [during the leave], and [it] usually applies to an employee’s family but also to the employee’s own health condition as well. Disability leave is a doctor-approved personal injury or illness, and compensation is at the discretion of the employer. FMLA is also applicable to employees who have worked in an organization for at least a year, so it is ideal for long-term employees.”

Disability under the ADA

The ADA’s disability rules apply to any employer with at least 15 employees. It ensures that any employee who can’t perform their job functions has the right to take disability leave or make use of reasonable accommodations like scheduling changes. 

Disability under the FMLA

The FMLA requires employers to provide employees with unpaid leave for family issues, such as adoption, pregnancy, family or personal illness, or military leave. It ensures the employee has health insurance coverage continuation and job protection while they are away from work.

The FMLA applies to the following types of employers:

  • Private employers with 50 or more local employees
  • All public agencies
  • All schools (public and private) 

Not all employees are covered under the FMLA — only those who’ve been with the company a year or more and worked at least 1,250 hours in the previous 12 months. 

Under the FMLA, disabled workers can take up to 12 weeks of unpaid leave, during which their employer-provided health insurance remains in effect. After the 12 weeks, they get their old job or an equivalent position back. 

“FMLA broadens protections and coverage across a range of situations preventing the employee from working,” said Jim Pendergast, senior vice president and general manager at altLINE. “That could be medical, but it might also be because of a family emergency, an adoption, or because of situations related to military deployments.”

TipBottom line

The ADA and FMLA serve as employment and anti-discrimination laws in the workplace. They prevent the unfair treatment of employees who can’t perform their jobs due to a disability or temporary disabling condition.

Who is covered under disability leave?

Most employees are eligible for disability leave, as long as they meet the insurance provider’s requirements. Many providers have eligibility requirements regarding the employee’s minimum earnings, how long they’ve been an employee, and whether they are a full-time or part-time worker.

In addition, to qualify for disability leave under the ADA, the employee must have a physical or mental impairment that significantly limits one or more “major life activities” or “major bodily functions.” Chronic conditions like cancer and Crohn’s disease can also qualify as disabilities. 

The ADA defines the following as major life activities:

  • Walking
  • Seeing
  • Sitting
  • Hearing
  • Speaking
  • Breathing
  • Learning
  • Lifting
  • Performing manual tasks
  • Taking care of oneself

These are some of the qualifying major bodily functions that may be impaired:

  • Immune system
  • Digestive system
  • Cell growth
  • Neurological system and brain
  • Circulatory system
  • Endocrine system
  • Reproductive system
FYIDid you know

If you have questions about disability leave, call the Job Accommodation Network, a free service sponsored by DOL’s Office of Disability Employment Policy, at 1-800-526-7234 or 1-800-ADA-WORK (1-800-232-9675) (voice/TTY).

What are the two types of disability leave?

There are two primary types of disability leave: short-term and long-term.

  • Short-term disability. Short-term disability (STD) leave is a business insurance benefit that provides compensation or income replacement for non-job-related injuries or illnesses that leave an employee unable to work for a limited time. STD policies will pay for employee benefits for a limited time, usually three months to a year. Generally, short-term plans are less expensive when purchased as part of a group plan and offered as a company-paid benefit. Generally, a private insurance program provides compensation when an employee is on short-term disability leave. Employees must be covered by a short-term disability policy to use the benefits. As an employer, you can offer short-term disability plans to your employees, or they can choose to purchase one elsewhere.
  • Long-term disability. Long-term disability (LTD) leave pays benefits for anywhere from two years to life, depending on the employee’s condition and the policy. The longer the benefit period, the higher the premium. 

The two types of policies are designed to work together. STD leave covers an employee immediately following a serious injury or illness. LTD insurance is meant to replace income if an employee is kept out of work past the end of their short-term disability benefits period.

Bottom LineBottom line

Short-term and long-term disability work together to manage employee benefits. Short-term policies pay for employee benefits during the waiting period before long-term benefits (if necessary) kick in.

What are an employer’s responsibilities regarding disability leave?

As an employer, you must know what you are required — and not required — to provide or do regarding disability leave. Here are six crucial rules to understand if you’re starting a business or already running one.

1. You are required to purchase STD insurance in certain states.

If you are an employer in California, Hawaii, New Jersey, New York or Rhode Island, you are required to purchase STD insurance for your employees. Depending on your state, you may be able to choose between a state and private policy. You might also have the choice of paying for the policy yourself, having employees pay it or sharing the cost.

2. You are only required to provide disability leave by law in certain situations.

As an employer, you can establish policies that apply to all employees regardless of disability status. However, you can’t refuse leave to an employee with a disability if other employees are offered leave. You might also be required to provide reasonable accommodations, such as flextime benefits or unpaid leave to a disabled employee.

Did You Know?Did you know

If an employee’s disability is covered by both the ADA and the FMLA, employers must provide leave under whichever law offers the most rights and benefits to the employee.

3. You are not required to provide disability leave so an employee can care for their relative.

Under the ADA, you are not required to modify your leave policy to allow an employee to care for a family member; employees can only use disability leave for themselves. However, the FMLA covers unpaid leave for an employee to care for a family member.

4. You are required to hold an employee’s job for them while they are on leave.

Under the FMLA, when the employee returns from leave, you must give them either their old job or a job that provides the same salary and benefits as their previous position. Additionally, you must continue to provide the employee with health insurance during their leave.

5. You are not required to pay employees who are on disability leave.

As an employer, you are not required to provide paid leave under the ADA or FMLA. However, California, Hawaii, New York, New Jersey and Rhode Island all require some form of paid leave.

TipBottom line

Paid leave types include vacation time, holiday time, sick leave, bereavement leave, sabbaticals and more.

6. You must have a certain number of employees for the FMLA and ADA to apply.

The ADA and FMLA only intersect if your business has 50 or more employees. This is because the ADA applies to businesses with 15 or more employees, while the FMLA applies to businesses with 50 or more. Each law also has different parameters regarding what qualifies an employee for leave. Here are several examples:

  • If an employee is injured on the job, they are covered by workers’ compensation and must go through the workers’ compensation claims process.
  • If an employee has a serious health condition, they are covered by the FMLA.
  • If the employee’s condition meets the definition of a disability, they are covered by the ADA.

Jennifer Dublino contributed to this article. Source interviews were conducted for a previous version of this article.

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Kiely Kuligowski, Staff Writer
Kiely Kuligowski is a and Business News Daily writer and has written more than 200 B2B-related articles on topics designed to help small businesses market and grow their companies. Kiely spent hundreds of hours researching, analyzing and writing about the best marketing services for small businesses, including email marketing and text message marketing software. Additionally, Kiely writes on topics that help small business owners and entrepreneurs boost their social media engagement on platforms like Facebook, Twitter and Instagram.
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