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Terminating Employee on SDI

I am located in California. I currently have an employee that is out on State Disability. It has become painfully clear how poor his performance was during this time. What are my options in regards to terminating his employment? I have less than 50 employees. Thank you.

California’s State Disability Insurance (SDI) provides wage replacement benefits to employees who cannot work due to an illness or injury, pregnancy and/or bonding with newborn child, or caring for an ill family member.

SDI premiums are paid through taxes that employers are required to withhold from employees’ paychecks. Since SDI is a benefit provided through the state and not the employer, an individual’s benefits will not terminate solely because his employment has terminated.

An employer is able to terminate an employee who is on SDI. However, it’s important to first consider your obligations under applicable federal and state laws.

The federal Family and Medical Leave Act (FMLA) and the California Family Rights Act (CFRA) provide qualified employees of covered employers up to 12 workweeks of unpaid, job protected leave for specified family and medical reasons. Covered employers under both the FMLA and CFRA include those who employ 50 or more employees in 20 or more workweeks in the current or preceding calendar year.

An employer who doesn’t meet eligibility criteria is not required to comply with either the FMLA or CFRA. However, employers in California must also consider their obligations under the California Fair Employment and Housing Act (FEHA).

Under FEHA, employers with 5 or more employees must provide up to 4 months of job protected pregnancy disability leave (PDL). Employees disabled due to pregnancy, childbirth or related medical conditions are able to take PDL either all at once or intermittently. Men are not entitled to PDL; thus, this law is not applicable to your situation either (but it’s still important to know about).

The federal Americans with Disabilities Act (ADA) must also be considered. The ADA applies to employers with 15 or more employees and requires employers to provide reasonable accommodations to employees with covered disabilities unless doing so would cause an undue hardship, meaning a significant difficulty or expense.

Under the ADA, an individual is considered to have a disability if he has a physical or mental impairment that substantially limits one or more major life activities, has a record of such an impairment or is regarded as having such an impairment.

Depending upon the employee’s disability, his conditions may be covered under the ADA. It’s commonly believed that an employee with a temporary disability is not protected by the ADA. However, this is not always true. Thus, it’s in your best interest to consider if the ADA applies and, if so, what reasonable accommodations can be provided to permit him to perform his job functions. A short term leave can be considered a reasonable accommodation.

Another factor to consider prior to terminating the employee is your policy or past practice of providing leaves to disabled employees. Such leave benefits should be applied consistently to all similarly situated employees.

Lastly, even though you’ve become aware of the employee’s poor performance since he’s been on leave, treating the employee in the same manner as other similarly situated employees decreases the risk of a wrongful termination claim. This is not to say that you cannot terminate the employee for his past actions. But, if you decide to do so, make certain that you have perfectly clear, concrete evidence of his poor performance. Be sure that you can easily explain why his poor performance was not discovered and addressed prior to his applying for SDI.

The employee cannot be terminated solely because he has applied for SDI. Though this doesn’t appear to be the case in this situation, it will still be your case to prove if the employee files a wrongful termination/discrimination claim. Thus, it’s often advised to treat the employee as you usually would before the performance issues were discovered.

So, if you choose to proceed with termination, just make sure you’re willing and able to back up your decision in court one day, if need be. HTH!

This entry was posted on Thursday, July 16th, 2015 at 12:39 pm and is filed under
Benefits, Labor Laws, Termination.
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