Recently, the Equal Employment Opportunity Commission ("EEOC") entered into a consent decree with Blood Systems, Inc. and its subsidiary, United Blood Services ("United Blood") that forces United Blood to pay Six Hundred Fifty Thousand Dollars ($650,000) to twenty-three (23) employees with disabilities who were terminated under United Blood's disability policies. This settlement highlights the EEOC's position on employers who use strict "neutral" disability policies and raises a number of important legal questions.

Recall that many employers have sought ways to avoid illegal discrimination lawsuits that are brought for "improperly" administering the company's disability policies. In order to avoid these lawsuits (for example, claims have been brought alleging that males were allowed to remain on disability leave for longer periods of time than their female counterparts) companies developed "neutral" policies that treat everyone, regardless of race, gender, etc., exactly the same. For example, in the United Blood case, the employer had a "neutral" disability policy that allowed individuals to remain on disability leave for only one hundred twenty (120) days. At the conclusion of 120 days, employees who could not or did not return to work were terminated, regardless of their status or position. This policy surely allowed United Blood to avoid any unlawful discrimination claims regarding how the policy was administered.

However, the EEOC brought suit against United Blood in 1999 and eventually extracted a $650,000 settlement two years later on the grounds that such a policy violated the Americans with Disabilities Act ("ADA"). Unlike most discrimination laws, which force employers to treat individuals in the protected class the same as all others, the ADA forces companies to treat employees in the protected class better than other employees. As such, the EEOC claimed that by following an unbending rule instead of dealing with each employee individually, United Blood violated not only the wording of the ADA but the spirit of the law as well. The EEOC argued that the ADA requires employers to analyze each disabled employee's case individually to determine if there is a reasonable accommodation (including the possibility of extending disability leave for a short period of time), that would allow the individual to perform the essential functions of his or her job.

Although the EEOC stated that its position is not intended to force employers to keep disabled employees on its payroll "forever," the EEOC has made it clear that "neutral" disability policies are likely to incur the EEOC's wrath in the future as well. This extremely large settlement should be a warning to all employers who have strict "neutral" disability policies in place. Employers should be reviewing their policies in light of this recent case and, potentially, redrafting such policies where needed.

This also raises a number of other related legal questions. For example, by doing away with a completely neutral policy, does an employer have any other option other than to go back to risking unlawful discrimination lawsuits concerning who gets leave and for how long? How long must a disabled employee be kept "on the books" before a company can effectively terminate him/her? Does the ADA require additional leave as a reasonable accommodation? If so, how much is reasonable? The bottom line is that the EEOC's position has created more problems than it has solved.

If your company needs assistance in reviewing its disability policies, requires assistance in re-writing its policies in light of these events, or wants additional advice in determining the legal ramifications of disabled individuals returning (or not returning to work), please call the Rhoads & Sinon Labor Employment Department for guidance and assistance