Many landscapers severely underestimate the scope, complexity, and financial impact of employee leaves of absence. Depending upon the size of the landscaping company and the state(s) in which it conducts business, there could be 15-20 different types of employee leaves of absence that must be communicated, documented, and managed to remain legally compliant. Failure to maintain compliance can produce significant legal costs to the company, and in several cases, financial costs can even be applied against the employer’s personal assets.
Case in point, a recent survey showed that the average legal fees for an employer to defend itself against a single violation of the Family and Medical Leave Act (i.e., FMLA) approached $78,000. That cost does not include financial penalties associated with lost wages, benefit reimbursement, or emotional distress.
To help landscapers reduce financial risk to their companies and themselves, this article provides a description of employee leaves of absence, an overview of the key issues related to them, and some best practices from leaders in our industry.
LEAVES OF ABSENCE
There are three categories of leaves of absence:
1) federal (e.g., FMLA, Uniform Services Employment and Reemployment Rights Act, Federal Jury Duty),
2) state (e.g., New York Military Spouse Leave Act, Tennessee Maternity Leave Law, Illinois Blood Donation Leave), and
3) employer discretion (e.g., vacation, sick leave, personal time off).
With those categories in mind, it is critical for a landscape company to identify all leaves of absence that impact its business operation, specify precise compliance routines for each type of leave, and document the exact steps the company takes every time an employee uses a leave of absence. The lack of detail in tracking all leaves of absence, as well as the manner in which multiple leaves of absence overlap (e.g., FMLA and workers’ compensation), can lead to costly financial penalties.
Here is a list of broadly-defined common leaves of absence, paid as well as unpaid, that all landscapers should consider:
• Vacation,
• Sick leave,
• FMLA,
• State-specific medical and/or family leave (e.g., California Family Rights Act, Arkansas Organ and Bone Marrow Donor Act 2235, Rhode Island Parental and Family Leave Act),
• Federal and state pregnancy leave,
• State military leave,
• Workers’ compensation,
• Disability and rehabilitation,
• Uniform Services Employment and Reemployment Rights Act (USERRA),
• Federal and state jury duty,
• Witness duty,
• Domestic violence and sexual assault,
• Serious crime victims,
• Bereavement leave,
• School activities,
• Time off to vote,
• Voluntary firefighters and police,
• Literacy education,
• Drug/alcohol rehabilitation,
• Civil air patrol,
• Paid family leave,
• Personal time off,
• Employee birthday, and
• Religious observance.
Beyond the large number of leave programs that must be managed, this issue is further complicated by state and federal laws that address similar functions (e.g., medical, pregnancy, military) yet have very different legal requirements that must be upheld. Thus, it is vital for landscapers to thoroughly review BOTH federal and state leave of absence laws.
It is strongly recommended that landscape companies evaluate each legally-required leave of absence on the following criteria to reduce potential violations and financial costs:
• Legal Requirements: Specify whether the leave is mandated by federal and/or state government, clarify the minimum size of the organization that must comply, identify the reasons an employee can take the leave, and determine if the particular leave can run concurrently with other leaves of absence (e.g., FMLA and workers’ compensation).
• Compensation/Benefits: Determine if the employee will be paid or not paid and/or continue to receive benefits (e.g., medical, vacation accrual, seniority) while on leave of absence.
• Eligibility: Identify the standards associated with those employees capable of receiving the leave of absence (e.g., number of hours worked in a year, tenure, full/part-time employment status).
• Duration: Clarify the exact length of time that each leave of absence grants to an employee and how that time can be taken (e.g., individual hours, eight hour increments, 40 hours per year).
• Guaranteed Return to Work: Specify whether the employee has a guaranteed return to work to an “equivalent,” “same,” or “comparable” position or job assignment, once the leave of absence has been completed.
• Employer Verification: Determine if the employer can demand paperwork (e.g., medical provider, jury commissioner, school teacher) to verify the employee participated in the leave of absence.
• Penalties: List the full range of possible penalties, costs, and terms related to non-compliance.
PENALTIES
The penalties related to leaves of absence violations are usually related to one of three employer errors: negligence, improper administration, and retaliation. Negligence is when that the employer does not offer, communicate, or approve the available leaves of absence as defined by law. For example, this would be evident if an employee was injured on the job and the employer did not inform the employee of his/her rights to workers’ compensation or state disability support.
Improper administration is evident in those situations where the employer does not abide by the legal procedures outlined by the particular leave of absence program. Examples of improper administration include: not using correct administrative forms, violating employee privacy rights (e.g., HIPAA and FMLA), and not continuing medical benefits while an employee is on a leave of absence. Improper administration also represents evidence supporting the more expensive claim of employee discrimination.
A growing legal concern is employer retaliation against employees who take leaves of absence. Many recent court decisions have ruled in favor of employees based on employer comments (e.g., “Aren’t you back from medical leave yet?” “What am I going to do to cover your work while you are out on workers’ compensation?”), or documenting the nature, detail, or occurrence of a leave of absence in an employee’s annual job performance review (e.g., “John’s performance this year was severely hindered due to the fact that he missed 5 weeks of work while on leave of absence.”).
Penalties are determined by the specific leave of absence and the manner in which it was violated. Likely penalties include the following: employee reinstatement, back pay, reimbursement for lost benefits, attorneys’ fees, injunctive relief, state/federal court costs, civil lawsuit, and financial fines. Moreover, employers who willfully refuse to rehire, promote, or otherwise restore an employee as required by a grievance procedure or hearing, may be found guilty of a misdemeanor. Clearly, any of these penalties, as well as a combination of multiple penalties, is potentially severe, costly, and ruinous to a landscaping company.
BEST IN CLASS PRACTICES
In an effort to reduce the company’s financial risk, in managing leaves of absence, here are some Best in Class Practices utilized by top landscapers from across the country.
• Training
Best in Class companies train all appropriate staff (e.g., administrative, human resources, supervisors) on how to identify, discuss, and review leaves of absence relevant to their company.
• Communication
In addition to having all required state and federal employment posters in place, Best in Class companies have an employee handbook that addresses each available leave of absence, stipulates an anti-moonlighting standard while on leave, cites a “rolling 12-month” timeframe for using certain leaves of absence, and has each employee sign an arbitration agreement.
• Policies
Develop formal policies to ensure compliance with each type of leave of absence to include: specific compliance standards, definition and duration of each leave of absence, employee eligibility standards, justification for taking each leave, impact on pay, seniority and benefits, appropriate paperwork and confidentiality standards, employee notification, re-employment criteria, and termination rights.
• Employment Practices Liability Insurance
This is insurance specifically designed to protect against loss incurred in litigating and settling various human resources issues including violations of federal and state leave of absence laws.
• Tracking Procedures
Best in Class companies have established detailed procedures that track all aspects of each type of leave of absence for every employee across legal time frames. This documentation typically includes: eligibility, relevant dates (e.g., request, approval, onset, and completion), number of leave hours taken, pay and benefits, forms utilized, verification and recertification, concurrent leave usage, and supervisory comments.
• Legal Guidance
Due to the detailed nature and severe penalties associated with various leaves of absence, Best in Class companies frequently rely on expert legal guidance when confronted with the technical complexities inherent with many of these situations.
SUMMARY
Landscape companies typically view the extent of leaves of absence as being vacation leave, sick leave, or workers’ compensation. That is not case; that is the reason leaves of absence are one of the most severe human resources mistakes a landscape company can make. In much the same way a landscaper must assess a job before offering an estimate, it must also conduct a similar assessment of the leaves of absence that may affect its operation. By addressing this challenging topic proactively, landscapers can improve their legal compliance, minimize legal risk to their companies, and reduce their own personal financial liability.
By-line at the conclusion of the article
Steven Cesare, Ph.D., is an Industrial Psychologist with the Harvest Group, a nation-wide consulting firm committed to helping landscape companies reach their potential. If you have any questions on this article, or any other human resources issue, please contact Steve at (760) 685-3800 or Email
