The Employer's Roadmap to Managing Unpaid Leave

An unpaid leave of absence is any time taken off work approved by higher-ups, but for which the employee isn’t compensated.

Unpaid time off work is a benefit companies offer in addition to paid time off and can be taken for various purposes. 

Below, we’ll discuss the different unpaid leave types, and the laws that regulate unpaid leave, answer the most frequent questions regarding unpaid leave and show you how to track and manage unpaid leaves in your organization.

The Types Of Unpaid Leave

Be it heartbreak or a broken arm, there are too many reasons why an employee needs to take time off to fit into specific categories. 

Once an employee exhausts all the paid leave options, here are the unpaid leave types they can opt for. 

The Family And Medical Leave Act under The FMLA

The Family and Medical Leave Act (FMLA) is the only law that requires employers to provide any time off to employees (allowing paid time off is entirely at the employer’s discretion).

The FMLA guarantees up to 12 weeks of unpaid time off per year and protects the jobs of employees on leave during that time. 

It applies to:

• Companies with 50 or more employees;
• All public agencies;
• Public and private elementary and secondary schools.

To take unpaid leave, staff members need to have worked for their employer for at least 1.250 hours or 12 months. Also, employees must work at a workplace in which the company employs 50+ staff members within the 75-mile range. 

The FMLA allows unpaid time off for the following reasons:

• Childbirth, newborn care, and pregnancy complications;
• Child adoption and foster care;
• Caring for an immediate family member (spouse, child, or parent) with serious health issues;
• The employee is unable to work due to serious health conditions.

Maternity and paternity leave are often compensated as a special employee perk — see which countries have the best parental leave!

The FMLA only mandates a bare minimum of unpaid time off the employees are entitled to; plenty of U.S. states expand the eligibility and/or offer more unpaid time off to local workers.

The FMLA requires that the employees who take unpaid time off retain their group health benefits during the leave.

Since 2008, the FMLA also covers military family leave.

Disability Leave Under The ADA

The Americans with Disabilities Act (ADA) covers both mental and physical health issues, allowing employees to take unpaid time off as a “reasonable accommodation”. 

Unpaid time off may be taken to recover from surgery, symptom flare-ups and recurrences, or to obtain necessary medical treatment. Equal Employment Opportunity Commission (EEOC) may allow leave so the disabled employee can participate in the training of a service animal or repair a piece of equipment (e.g. wheelchair).

ADA leave can be intermittent, and it is up to the employer to specify the reasonable leave duration.

ADA and FMLA overlap in some cases, but aren’t the same! For example, the ADA applies to employers with at least 15 employees, and having a “serious health condition” under the FMLA doesn’t equate to “having a disability” under the ADA.

Bereavement Leave

Bereavement leave is time off given to an employee who needs to deal with matters related to losing a loved one: to grieve, arrange/attend a funeral or a memorial service, and handle legal matters. 

Bereavement leave usually applies to immediate/close family members: parents, siblings, children, spouses, partners, and grandparents. Some proof of loss (e.g. a death certificate, or something less formal) may be required when requesting a bereavement leave.

California, Oregon, Illinois, Maryland, and Washington are the only states that require employers to provide bereavement leave, to various degrees.

Jury Duty

Jury duty leave is time taken off to perform an obligatory jury service. 

It is guaranteed by the Jury Selection and Service Act (§1875. Protection of jurors' employment) and it protects employee benefits and job security during the leave.

In some states (Alabama, Colorado, New York, etc), employees must be compensated for jury duty leave, but no federal law requires it, so employers must review local laws that apply.

Voting Leave

While federal laws don’t require employers to provide time off for voting, the large majority of the states do. More states reimburse employees on voting days; unpaid time off for voting is granted in Alabama, Arkansas, Georgia, Kentucky, Massachusetts, and Wisconsin.

Employees have anywhere from one to four hours to vote, while several states don’t specify and it is up to the employer to decide how much time they have to vote.

Furlough Leave

Furlough is a temporary unpaid leave imposed on the employees when employers don’t have enough money to pay out the workers, or when the workload dramatically decreases.

Many companies went through furlough during the pandemic, and the employees were welcomed back once the situation normalized.

According to the U.S. Department of Labor, furloughed employees may be eligible for unemployment benefits, but can’t claim paid sick leave or paid expanded family and medical leave.

Sabbatical Leave

Sabbaticals originate from Harvard University and go way back to 1880! 

Academic workers were offered a paid sabbatical leave as an employee benefit. Ranging from one semester to a full academic year, they could use that time either to rest or advance in their respective fields in a different setting.

Sabbaticals have spread to non-educational workplaces and refer to any prolonged work break that allows employees to pursue various interests, more or less related to their work field. It can also be used for health reasons and/or deep rest, for the employees who feel they’re about to burn out and need to approach their health more seriously.

Today, a sabbatical is a somewhat prestigious workplace perk offered to loyal, indisposable staff members, under specific conditions. Usually, top performers gain the right to a sabbatical after a specific number of years spent at the company, with a track record that proves they’re an important asset for the employer. 

In most cases, the sabbatical is unpaid, but the employer may provide a full or partial salary, especially if the sabbatical is intended to improve the employee’s skill set.

How Long Can Unpaid Leave Last?

Apart from the FMLA rules (up to 12 weeks of unpaid leave), there are no legal obligations for U.S. employers to provide workers with any leave type. There are also no state-proposed limitations as to how much time off can an employee take.

Therefore, the length of unpaid leave may range: from an hour or two to take care of something as minute as a bank appointment, to a year-long sabbatical. It all depends on the employee rulebook and employment contracts that employees have agreed to sign upon entering the company.

How To Keep Track Of Unpaid Leave?

Managing unpaid leave in your business boils down to these three essential steps: 

• Consider your organization type and unique needs — A generous time off policy is an employee benefit guaranteed to attract stellar workers, but thread carefully. You don’t want to halt the operations thanks to everyone taking time off at the same time, or end up alone in a busy shift!

• Create a mockup of your time-off guidelines — The first version will contain everything time-off related. There’s no such thing as too detailed a time off policy: you can never know what kind of scenario may hit, better safe than sorry!

• Double-check with legal experts — Leave laws are different for each U.S. state, and they get increasingly complex if you employ a global workforce. This step will let you check if your leave rules correspond to your legal obligations and avoid harsh penalties.

• Introduce a leave management tool — For hassle-free leave tracking, try Vacation Tracker. You can test all the features for seven days and see how easy it can be.

• Publish! In the end, let your employees know about their rights, rules, and communication channels they need to use to request time off.

Anja Milovanovic

A journalist turned content writer, Anja uses her investigative skills to produce high-quality SaaS, Marketing, and HR content.