A leave of absence agreement is a written agreement between an employer and an employee that documents the terms and conditions of an employee’s leave of absence from a business.
A leave of absence agreement grants an employee an absence from their job for a specific length of time so they may attend to other matters. The employer agrees to hold the employee’s job (or a similar position) for the employee upon their return from leave. The employee agrees to return at a specified time.
Before entering a leave of absence agreement, the employee is typically required to submit a formal leave of absence letter.
Different Types of Leave
There are generally two different types of leaves of absence contemplated by a leave of absence agreement. These include extended leave and intermittent leave:
Extended leave refers to a leave of absence for several weeks or months to address a life situation, such as the birth of a child, the need to settle the estate after the loss of a parent, dealing with illness, or other situations approved by the employer.
*Please note that Intermittent Leave is not covered under the scope of our LegalTemplates document.
On the other hand, intermittent leave requests either a reduction in hours per day or a reduction of days worked for reasons such as ongoing education or training. For example, an employee may request intermittent leave where they work for six hours instead of eight each day for the next two months.
In the case of medically related intermittent leave, the request may involve attending a standing medical appointment or a shorter workday while recovering from an illness, such as cancer. 
When a Leave of Absence Agreement Is Necessary
Leave of absence agreements benefit both the employer and employee in different ways.
When Employers Need a Leave of Absence Agreement
When a valued employee indicates a desire to leave employment for personal reasons, you, as an employer, may wish to execute a leave of absence agreement. This agreement offers the employee assurances you will hold their job for them while they are away. You can set the terms and conditions, including, for example:
- The length of time the agreement is valid;
- Your expectations about employee conduct during the leave;
- Documentation required(if any);
- Any competency testing or proficiency testing to be performed upon return from leave; and,
- The conditions which convert a voluntary leave to a termination.
Incorporating the above definitions and parameters will help protect your business by clearly defining the obligations and responsibilities of both parties.
Defining the nature and length of a leave of absence is an excellent first step when creating a leave of absence agreement. Keep in mind that the more detailed you are, the more effective and comprehensive it will be.
When Employees Need a Leave of Absence Agreement
If you plan to take a leave from employment, a leave of absence agreement protects you and your position in the company. A leave of absence agreement is a contract. It’s a written guarantee you won’t lose your job, your seniority, or your place in the company due to your leave.
It also details expectations about benefits, conditions you must meet during the leave and immediately before your return from leave, and how your leave may transform into a termination.
For Both Employers and Employees
A leave of absence agreement defines the terms and conditions of leave. Any time an employee takes a leave of absence, a written agreement defining the terms of the leave and the expectations of both parties protects the rights of both.
Consequences of Not Having a Leave of Absence Agreement
Without a leave of absence agreement, employees have no guarantee that their job or a similar position will be available for them when they’re ready to return. Employers face uncertainty about when or whether an employee will return.
Without reducing the agreement to writing, unintended consequences often present themselves. Failing to use a written document detailing the terms of the leave leaves the initial intentions and agreed-upon obligations to one’s memory, making it highly susceptible to change or breach.
For example, miscommunication may result in the loss of benefits if the employee fails to pay an employer their agreed-upon share. Alternatively, an employee may not understand a doctor’s note is required to return to work, resulting in unexpected delays.
The time it takes to execute a leave of absence agreement is significantly less than the time and heartache (not to mention the cost) of litigating an issue that could have been addressed in an executed written agreement.
Most Common Uses for a Leave of Absence Agreement
An employer can use a leave of absence agreement in any situation they believe merits granting a leave of absence. However, the most common reasons for using this document include the same reasons listed under the Family and Medical Leave Act (FMLA). Of course, the FMLA only covers employers and employees who meet specific criteria. 
Reasons for a leave of absence include:
- The birth of a child;
- The adoption of a child;
- A child placed in the home in foster care;
- An employee dealing with a serious health condition; or
- A situation arises from an emergency related to a spouse, child, or parent on active duty status.
Other situations where an employer may but is not legally required to agree to a leave of absence include:
- A leave to provide time to handle the estate after the death of a parent;
- A leave to spend time with and care for small children during the summer months;
- Taking a class or training to advance their career;
- Attending school abroad for a semester;
- Caring for a loved one not covered under the FMLA, such as for a roommate or friend; or
- Extended bereavement leave.
In addition to federal law, all states have state-specific leave laws.  These laws provide various situations, such as leave for parents to attend school-related activities or recovery time for bone marrow donors.
What to Include
Here are some elements to include in a leave of absence agreement:
Dates of the Leave
For extended leave, a leave of absence agreement should include both the start date and the anticipated end date of the leave. If the leave length is uncertain, such as when dealing with a health condition, the end date should still be included, along with any language detailing extensions.
Extension Details of the Leave
In situations where an extension may be required, such as when dealing with an illness, you should address extension details comprehensively, including:
- How: how an extension should be requested (including whether the request must be in writing);
- Timeframe: the date of the extension request about the anticipated end date of the leave;
- Parties to the extension: identify all contacts who must receive notification regarding any requested extension;
- Other terms: whether other terms and conditions of the leave (such as who pays for benefits, the accrual of vacation, etc.) change or remain the same in the event of an extension;
- Resignation: if the extension request does or may constitute a resignation; and
- Modifications: the circumstances under which an extension request modifies the employer’s obligation to hold the same position instead of another position within the company.
Other Details Regarding Leave
Additionally, you should include the following details about the leave of absence:
- Whether the employer expects reports about the status of the leave on an ongoing basis;
- If the employer expects a physician’s statement, either during ongoing leave or as a condition of returning to work, as well as the contents of the statement (i.e., “released back to work,” “no longer contagious,” etc.); and
- The consequences if the employee doesn’t meet the terms and conditions of the agreement.
Benefits Details (If Any)
The agreement should address and delineate all details about job benefits during the leave. Such benefits include:
- Whether the employee must exhaust paid vacation and sick time before taking unpaid leave;
- Whether vacation and ill time still accrue during the absence;
- Whether vacation and sick time still accrue, and if they do, whether the rate is different than accrual during full-time employment;
- Whether the employee still qualifies for health, dental, life, and disability insurance;
- Who pays for the benefits such as health, dental, life, and disability, and in what proportion;
- Whether the leave impacts any pension plan contributions made by the employer;
- How the employer expects employees to pay their portion of the benefits (if applicable); and,
- The consequences of the employee not paying their portion of the benefits.
Job Position Details
A leave of absence agreement should specify whether an employer anticipates holding the employee’s current job. Additionally, the agreement should detail whether there’s a possibility that no position will be available when the employee is ready to return.
If this is a possibility, the agreement should address alternatives. Will the employer offer them the next available position? Will the employer consider them for the next open position without application? Both the employer and the employee should know the benefits and the potential risks involved.
Sometimes, a given benefit or condition does not apply. Addressing the issue is the best approach, rather than remaining silent on any issue where the parties may disagree.
Leave of Absence Agreement Sample
Here’s what a standard leave of absence agreement template looks like. Download it as a PDF or Word file below:
Frequently Asked Questions
I want to spend three weeks hiking and camping. Can I make my employer sign a leave of absence agreement?
No. Hiking and camping are not activities covered under the FMLA or the American Disabilities Act. Your employer is not required to grant you unpaid leave for this activity. However, you could request an unpaid sabbatical since there is nothing prohibiting your employer from entering into an unpaid leave agreement if they are so inclined.
I want to use my saved vacation time to help a family member in need. Do I need a leave of absence agreement?
No. A leave of absence agreement is designed for situations where you are taking leave not covered by sick time, vacation time, or personal leave time.
Can I take a leave of absence due to work-related stress?
Yes, your workplace may let you take a leave of absence due to work-related stress if the stress is causing physical and mental health problems. During your leave of absence for stress, you can identify stressors, develop management techniques, and attend medical appointments to seek the proper help.