The pandemic taught businesses many invaluable lessons—like the importance of adapting to change, being prepared for hard times, and staying flexible and agile.

Another key takeaway? A detailed sick leave policy is an absolute must.

For some employers, the idea of having a sick leave policy feels a little counterintuitive. If you let your employees stay home from work too often, your productivity will drop—right? Not quite.

In fact, a healthy workforce is key to increasing productivity, and a clearly defined sick leave policy is proven to help reduce employee turnover, among a host of other benefits. So let’s dive in!

Do you really need a sick leave policy?

Yes, a sick leave policy is a necessity.

The Americans with Disabilities Act (ADA) requires employers with 15 or more employees to provide reasonable accommodations for employees with disabilities. This includes the provision of sick leave as an accommodation if needed.

The Family and Medical Leave Act (FMLA), on the other hand, applies to employers with 50 or more employees and provides eligible employees with up to 12 weeks of unpaid, job-protected leave for specified family and medical reasons, including the care of a spouse, child or parent with a serious health condition.

Additionally, over 30 states and localities have their own sick leave requirements. A comprehensive sick leave policy protects your business from lawsuits. It may be up to you whether you offer paid or unpaid leave, depending on your state and locality. Keep in mind: a paid sick leave policy immensely benefits both employers and employees, helping to encourage a healthy work environment, promoting wellness, and boosting employee morale. Even if paid sick leave is not legally required, it might be the right choice for your business.

By continuing to pay employees when they’re home sick, you’ll attract more qualified talent and stay competitive on the hiring front. Employees with paid sick leave are more likely to stick around long-term, meaning you’ll save money by reducing employee turnover. Paid sick leave also helps lower health care costs, since employees have time to get the routine care they need—rather than heading to the emergency room after business hours.

Sick leave policy basics

A sick leave policy is a benefit that grants employees time off work when they are sick. The details of a sick leave policy vary from one employer to another, and sick leave can be paid or unpaid, depending on local law. Sick leave is different from paid time off (PTO), which grants employees paid time off for any reason (not just due to illness). Typically, a sick leave policy includes at least three main components:


Who is eligible for sick leave, and who qualifies for paid sick leave? (Most companies only offer paid sick leave to full-time employees, though some offer a partial benefit to part-time employees.) Keep an eye on your employee count because it may make you subject to a local sick leave law.

Accrual rate

Are a certain number of sick days granted at the beginning of every year? Or do hours for sick leave accrue over time? (The majority of companies offer the latter.) A minimum rate is sometimes set by local law.


What qualifies as a sick day? How much notice do employees need to give? Do they need a doctor’s note? Do they need to find a replacement for their shift?

What to consider when writing your sick leave policy

Here are a few things to consider when writing a comprehensive sick leave policy that protects employers and employees:

1. Review state and local laws

Minimum standards for sick leave vary across states, counties, and cities, with specifications such as the accrual rate, pay status, acceptable usage, and reporting obligations. Employers can choose to offer more favorable sick leave benefits than what is required by local laws.

2. Accrual vs. lump sum

With an accrual policy, full-time employees accrue sick days at regular intervals (usually a day or half-day every month). With a lump sum policy, employees will be granted a certain number of sick days every year. The days may be available immediately after the employee is hired, or there may be a waiting period before they can be used.

3. Rollover

Unused sick days may or may not roll over from one year to the next. A “use-it-or-lose-it” policy helps to even out the number of days used, but a roll-over policy allows employees to save up days for when they really need it. If sick days do roll over, they may cap off at a certain number of days.

4. Payout

Some companies allow employees to cash out on unused sick days, either at the end of the year or upon leaving the company. Some policies exempt employees from cashing out if they are terminated with cause.

5. Reporting

To use a sick day, employees will need to notify their supervisor on the day of use, either by phone or email. Some companies require the employee to find a coworker to cover their shift, and others may require notice within an hour of the workday starting. Employees may also be required to report the sick day to HR within a certain number of days after using the sick leave.
Generate your sick leave policy with SixFifty

Determining accrual rates and usage policies for sick leave can be a serious headache for employers, especially when trying to comply with local, state, and federal laws. Sick leave policies run the gamut from generous, unlimited paid sick leave to very limited, unpaid leave. How do you write a policy that fits the needs of your business? SixFifty to the rescue!

SixFifty’s Employee Handbook toolset streamlines the process of writing employee policies—especially when you have employees in multiple states. Don’t gamble with your sick leave policy. Ensure that your policy is comprehensive, compliant, and up-to-date by using our automated legal document generator. Book a demo today.