From the January 1998 issue of Entrepreneur

An employee who works alone in a warehouse comes to work "increasingly disheveled. His clothes are ill-fitting and often have tears in them. He has also become increasingly antisocial. When he has to talk to a co-worker, he is abrupt and rude. The employer's company handbook states that employees should have a neat appearance at all times. The handbook also states that employees should be courteous to each other."

Question: Can you fire this worker?

Don't rush to say "yes." The U.S. Equal Employment Opportunity Commission (EEOC) offers this example in the document it provides employers to help them address the psychiatric component of the Americans with Disabilities Act (ADA). Its answer: "The dress and co-worker courtesy rules are not job-related for the position in question. Therefore, rigid application of these rules to this employee would violate the ADA."


Robert McGarvey writes on business, psychology and management topics for several national publications. To reach him online with your questions or ideas, e-mail rjmcgarvey@aol.com.

Dark Clouds

All this may come as big news, but the fact is that the ADA--usually thought to encompass only physical handicaps--also covers a range of psychiatric conditions, from major depression through schizophrenia. By law, individuals suffering from these disorders are protected from discrimination in hiring or employment, with the EEOC required to put some muscle in the protection.

A key requirement of the ADA is that employers must provide disabled workers with "reasonable accommodations" if such accommodations will enable them to perform their jobs. Accommodations can range from inexpensive wall partitions to budget-busters: "An employer may be required to provide a job coach to assist in the training of an individual with a disability," says a representative of the EEOC.

Sift through the EEOC's interpretation of the ADA's psychiatric components, and worries may set in. Some legal experts share those concerns. "The EEOC guidelines regarding emotional disabilities are completely out of place in the modern work world," says Brooks Kubik, an employment lawyer with law firm Stites & Harbison in Louisville, Kentucky.

To small-business owners, the EEOC's involvement in psychiatric workplace issues may seem unnecessary at best--and invasive at worst. Ask the emotionally disabled, however, and they are adamant that they have been discriminated against in employment situations. A survey released by the National Alliance for the Mentally Ill (NAMI) in 1997 claims that one in three individuals with severe mental illnesses were turned down for jobs on that score.

What's more, "many of the 12 million people with disabilities in this country are capable of effective work if given the opportunity," says Peter Blanck, a professor of law and medicine at the University of Iowa in Iowa City and director of the Iowa Law & Disability Center, who is regarded as one of the nation's top ADA experts. "The biggest complaint of many employers is they cannot find good people in today's tight job market. And many disabled [individuals] will be good, productive workers."

A Silver Lining?

Grim as the ADA's implementation of rules regarding psychiatric conditions may sound, there is another side to this story. "ADA is not meant to upset small-business operations," says Blanck. "The biggest problem isn't the law; it's misinformation about it. There are many myths."

For example, "under the ADA, you don't have to hire anybody who cannot do what you need. You don't have to change job requirements in any way," says Blanck, who explains that the ADA includes no affirmative action requirements. "This is not a preferential treatment law."

Blanck notes that large companies have had to comply with the ADA for years. Businesses with 25 or more employees have had to comply since 1990, and the law was expanded in 1992 to include businesses with 15 or more employees.

What's more, says John Patrick Shannon, assistant dean at the University of Florida College of Law in Gainesville and a specialist in ADA issues, even the more broadly applied ADA might not impact your business: "Businesses with fewer than 15 employees are still exempt from all provisions."

Business owners' biggest concern comes down to the bottom line: cost. But the costs are not nearly as high as employers fear, says Blanck, who has done comprehensive studies of accommodations made by big business in the past five years. While fears typically focus on budget-wrecking expenditures such as job coaches, "the typical cost of an accommodation is $100," says Blanck.

What can $100 buy? Possibly a simple partition for a worker who has difficulties concentrating or a sound-deadening headset for a worker who has problems with loud noises. And some accommodations cost nothing--for instance, ignoring a warehouse worker's sloppy dress.

"Courts look at the nature of the business, its financial strength and its size in determining what's a `reasonable' [accommodation]," says Shannon. "The small business or start-up will never be required to make a $100,000 accommodation."

Taking Action

While fears may be exaggerated, that's not to say there are no risks to a business when it comes to the ADA's psychiatric component. Probably the biggest danger is that existing employees will file claims with the EEOC, charging on-the-job mistreatment or fired workers will file saying they were terminated because of a disability. And if the EEOC rules against you, penalties and subsequent judgments awarded in court can skyrocket into six or seven figures. Even a quick defense against meritless claims will cost you: "Defending against even a bogus claim under the ADA can easily cost a business $10,000 in legal fees, just to get through the EEOC investigation," says Kubik.

More troubling, adds Kubik, is that the number of ADA claims involving psychiatric issues is on the rise. Plainly put, the smart business ought to take steps now to strengthen its position.

"The first step is to never ignore potential psychiatric issues in your workplace. You cannot say `It's not my problem,' " says Stephen L. Sheinfeld, chairman of the Labor and Employment Law Department of law firm Whitman, Breed, Abbott & Morgan LLP in New York City and founding editor in chief of the monthly newsletter Employment Law Strategist. "Under the ADA, you are under no obligation to probe for impairments. However, when it is obvious there is an issue--or an employee tells you [there's one]--you have an obligation to engage in a dialogue with the employee to look for solutions."

What if you reach an impasse? Your best defense in all ADA cases that could wind up in court is having specific, comprehensive job descriptions on file. "Put in intangibles that you nonetheless deem essential--`the ability to work well with peers,' `the ability to keep a punctual schedule,' " says Sheinfeld. "The more detailed you get, the stronger your position if you must argue that the employee cannot perform the essential functions of the job. You also want to have written, detailed work rules and a code of conduct that spells out what's required and what conduct won't be tolerated.

Take precautions, he adds, "and the impact of the ADA on your business won't be large. Don't discriminate and do take proactive measures, and you will find the impacts are very small, if you see any at all."

Contact Sources

Equal Employment Opportunity Commission, http://www.eeoc.gov

National Alliance for the Mentally Ill, http://www.nami.org

Stites & Harbison, (502) 587-3400, bkubik@stites.com

Whitman, Breed, Abbot & Morgan, (212) 351-3304