Sick Leave: What you need to know

As we face winter, most employers will see an increase in staff absence due to illness. There isn’t a federal law requiring employers to provide employees paid sick leave, but most employers do provide it as an employee benefit.

When adopting a sick leave policy, employers must be sure that it fully complies with federal or state family and medical leave laws, the Americans with Disabilities Act, and any other applicable laws.

Interaction with Other Laws

Family and Medical Leave Act (FMLA):

FMLA requires employers to provide up to 12 weeks of unpaid leave to eligible employees for a variety of reasons related to family and medical care.

Generally, leave taken under the federal FMLA is unpaid. However, employees may be eligible to receive money or pay while they are on FMLA leave by substituting paid vacation, sick, personal, or other paid leave time for unpaid FMLA leave time.

Concurrent use of sick leave during FMLA leave:

If an employee chooses to substitute accrued paid leave for FMLA leave, he or she may do so. If an employee doesn’t choose to substitute accrued paid leave, the employer may require the employee to substitute accrued paid leave for unpaid FMLA leave pursuant to the employer’s established policies.

The employer may require that an employee comply with its established leave policies for use of paid leave, even if they are more (or less) stringent than the FMLA’s rules.

Under the FMLA regulations, the employer has the right to require that the employee provide a medical certification to verify a serious health condition—even in cases where the employee is substituting paid leave for unpaid FMLA leave. The FMLA regulations don’t permit employees to comply with a less severe medical certification standard under the employer’s sick leave plan when the employee substitutes any form of paid leave for FMLA leave.

When an employee chooses, or an employer requires, substitution of accrued paid leave, the employer must inform the employee that the employee must satisfy any procedural requirements of the paid leave policy only in connection with the receipt of such payment. This notice is provided in the federal Form WH-381 (Eligibility and Notice of Rights and Responsibilities).

If an employee doesn’t comply with the additional requirements in an employer’s paid leave policy, the employee isn’t entitled to substitute accrued paid leave, but the employee remains entitled to take unpaid FMLA leave.

Interaction with state laws:

The FMLA doesn’t replace state laws, which may provide greater leave rights to employees.

Employers covered by both state sick leave laws and the FMLA should carefully review the various provisions of both laws to make sure that employees receive the more liberal leave benefits.

Americans with Disabilities Act (ADA):

Allowing the use of accrued paid leave, or unpaid leave, is a form of reasonable accommodation when necessitated by an employee’s disability.

An employer doesn’t have to provide paid leave beyond what is provided to similarly situated employees. However, employers should allow an employee with a disability to exhaust accrued paid leave first, then the employer should consider unpaid leave as an accommodation.

No-fault attendance policies:

No-fault attendance policies are those under which employees are automatically discharged after they have been on leave for a set period of time, regardless of the reason for the absence.

Although no-fault policies are not a violation of the ADA, an employer should be prepared to grant additional unpaid leave if an employee is covered by the ADA or the federal Family and Medical Leave Act (FMLA).

Genetic Information Nondiscrimination Act of 2008 (GINA):

GINA prohibits employers from discriminating against employees or applicants based on genetic information about employees, applicants, former employees, or their family members. GINA applies to all public employers, private employers with 15 or more employees, employment agencies, and labor organizations.

If an employer’s sick leave policy allows supervisors to ask workers about the nature of the illness or injury before authorizing sick leave pay, or if a physician’s statement is necessary for sick leave, employers must consider GINA and the possibility that requiring such disclosure or certification may violate the law.

Employers with such sick leave policies are advised to include the GINA “safe harbor” statement in their policies and advise employees of the GINA provision.

Acquisition of genetic information is also considered unintentional if a manager or supervisor learns genetic information about an employee by overhearing a conversation between the employee and others or by receiving it during casual conversation with the employee or others. This is known as the “watercooler” exception.


No matter how an employer obtains genetic information, the information must be treated as a confidential medical record and kept separate from personnel files. Access to medical files should be strictly limited. Information may be kept in the same files that an employer uses for confidential medical information under the ADA as long as the ADA’s confidentiality requirements are met.

Read more about GINA here.

Common Sick Leave Practices

Most employers use an accrual method of calculating sick time, in which employees earn a certain number of hours or days for each pay period worked, perhaps up to a fixed number of days annually.

Employers that offer paid sick leave also generally require that employees be employed for a certain minimum period, typically 3-6 months, before becoming eligible to accrue and/or take sick leave.

Reducing liability for accrued, but unused sick leave:

If an employer offers sick leave, some courts may consider the offer a promise or implied contract to which the employer is required to follow.

In addition, many states’ laws consider certain types of paid leave to be the equivalent of wages, which must then be paid out at termination. This interpretation is more frequent when it comes to paid vacation time; however, employers should be aware of the potential requirement to pay out other forms of accrued leave, including sick leave, upon termination or discharge.

For this reason, some employers prefer to limit their liability for payout of accrued, but unused, leaves, including sick leave.

Ways to Limit Liability for Payout

The simplest way to do so is simply by means of a written policy that places a limit on the total amount of paid sick leave that any employee may accrue. Once the limit has been reached, no additional sick time accrues until some of the employee’s accumulated leave has been used. When the leave doesn’t accrue in the first place, no additional wage entitlement is created.

Another option is to “buy back” unused sick time at the end of a year, whether at full salary or a certain percentage of salary. Some employers also allow employees to donate their unused sick leave to coworkers on extended medical leave.

Finally, some employers may opt to compensate unused sick leave regardless of the law’s requirements or under certain specified circumstances.

Avoid discrimination

Employers that offer sick leave should ensure that their policies are applied fairly and consistently to all employees. When offering and administering sick leave, be particularly aware of discrimination traps in terms of sex, age, or disability.


Don’t know what to do about a team member who calls in “sick” but is actually fine? Here’s our advice!


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