Avoiding disability discrimination claims in the wake of statutory amendments and enforcement trends

Article provided courtesy of Jackson Lewis

Charges and lawsuits brought under the Americans with Disabilities Act (ADA) are on the rise. In the last fiscal year, the Equal Employment Opportunity Commission (EEOC) received nearly 26,000 charges of disability discrimination, more than double the number of charges received by the EEOC five years ago. Those charges resulted in more than $100 million in payouts to complainants, excluding those complainants who took their case to court.  In court, verdicts against employers in disability discrimination lawsuits have grown to unprecedented levels. On May 1, 2013, as the result of a charge of disability discrimination filed with the EEOC by 32 men with intellectual disabilities against their employer, an Iowa jury awarded the agency $240 million – the largest verdict in agency history.

As such, employers should be aware of some of the most common liability concerns in this area and proactively work to avoid exposure. Below we address two common areas of exposure for employers: the use of fixed term leave policies and the failure to recognize the expanded definition of “disability” under the ADA following the ADA Amendments Act of (ADAAA).

The detriments of “fixed leave” policies

The EEOC repeatedly has gone after employers for inflexible leave policies that do not permit leave beyond Family and Medical Leave Act (FMLA) leave or fixed leave policies, such as a policy providing that no employee shall have leave for more than 12 consecutive months. Such strict policies run afoul of the ADA because, under the ADA, employers must be willing to provide an exception to a fixed leave policy as a reasonable accommodation. The following are some recommended compliance strategies for leave administration:

  • Employers should follow a three-step analysis for every leave request, starting with asking what the employee is entitled to by the FMLA and under state leave laws, then asking what is the employee entitled to under company policy, and finally what reasonable accommodation the employer has to provide the employee.
  • Employers should ensure that written policies communicate a willingness to consider additional leave as an accommodation under the ADA.
  • Employers must not forget about ADA employees on leave; they should develop documentation to show that they considered return-to-work options along the way.
  • Employers can leverage paid leave and benefit programs, such as enhancing rules for employee notice requirements, minimum increments of leave, medical examination rules and communications during leave.

These strategies can reduce employers’ potential exposure significantly to the growing incidence of disability discrimination claims. Indeed, from 2008 to 2011, the number of ADA claims filed by the EEOC has more than doubled (from 37 to 80). With the EEOC’s increased focus on disability discrimination, employers should redouble their efforts to comply with the ADA.

The expanded definition of “disability” under the ADA following the ADAAA

Just over two years ago, the EEOC released its long-awaited Final Regulations implementing the ADAAA. The Final Regulations reaffirmed the purpose of the ADAAA: to make it easier for individuals with disabilities to obtain the ADA’s protection. The ADAAA made clear that the primary focus in ADA cases should be on whether employers complied with their obligations under the statute and whether discrimination occurred, not whether individuals are disabled under the law. As such, the Final Regulations greatly expanded the definition of “disability” under the ADA.

Under the ADA, a “disability” is defined as: a physical or mental impairment that substantially limits one or more major life activities of such individual, a record of such an impairment, or being regarded as having such an impairment. 42 U.S.C. § 12102(1). The ADAAA provided several “rules of construction” with respect to this definition, a selection of which are highlighted below:

  • The term “substantially limits” is to be construed broadly in favor of expansive coverage, to the maximum extent permitted by the terms of the ADA.   
  • Whether an impairment “substantially limits” a major life activity should not demand extensive analysis.
  • Except in the cases of ordinary eyeglasses or contact lenses, the determination of whether an impairment substantially limits a major life activity is to be made without regard to the ameliorative (beneficial) effects of mitigating measures.
  • An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active.
  • An impairment that substantially limits one major life activity need not substantially limit other major life activities in order to be considered a substantially limiting impairment.

While careful to state that an individualized assessment is always required, the Final Regulations allow that some impairments involve “predictable assessments” which, in “virtually all cases,” will result in a finding that they are covered by the ADA. According to the ADAAA, impairments that should lead to “predictable assessments” include deafness, blindness, intellectual disabilities, partially or completely missing limbs or mobility impairments requiring the use of a wheelchair, autism, cancer, cerebral palsy, diabetes, epilepsy, HIV infection, multiple sclerosis, muscular dystrophy, major depressive disorder, bipolar disorder, post-traumatic stress disorder, obsessive compulsive disorder, and schizophrenia.

The most far-reaching provisions of the Final Regulations arguably can be found in the provision on coverage when one is “regarded as” having a substantially limiting impairment. The Final Regulations clarify that an individual is “regarded as having such an impairment” if the individual is subjected to a prohibited action because of an actual or perceived physical or mental impairment, whether or not that impairment substantially limits, or is perceived to substantially limit, a major life activity.

From a day-to-day management perspective, the Final Regulations means that many more individuals will be entitled to reasonable accommodations. Carriers should expect that ADA cases will proceed to a point where employers must defend decisions by showing individuals were not “qualified” because they could not safely or successfully perform essential job functions, with or without reasonable accommodations, or that the employers offered or attempted unsuccessfully to offer reasonable accommodations. Every adverse employment decision that is based on an individual’s inability to perform due to an injury or illness has the potential to lead to a contested ADA case. 

The recommendation(s) and contents of this material are provided for informational purposes only. This material does not purport to address every possible legal obligation, hazard, code violation, loss potential or exception to good practice. It should not be construed as indicating the existence or availability of any insurance coverage. Hanover Insurance Companies and their affiliates and subsidiaries specifically disclaim any warranty or representation that compliance with any advice contained herein will make any premises, property or operation safe or in compliance with any law or regulation. The Hanover Insurance Group with Eagle Icon is a trademark of The Hanover Insurance Group, Inc.