Undue Hardship | Practical Law

Undue Hardship | Practical Law

Undue Hardship

Undue Hardship

Practical Law Glossary Item 2-504-2937 (Approx. 5 pages)

Glossary

Undue Hardship

In employment law, a potential defense available to employers who would otherwise be required to take certain action under federal law. This term has several meanings under different statutes.
Under the Americans with Disabilities Act (ADA) and the Pregnant Workers Fairness Act (PWFA), an employer is not required to make a reasonable accommodation that would impose an undue hardship on the employer. Under the ADA and the PWFA (which uses the ADA's definition), undue hardship is any action that fundamentally alters the nature or operation of the business or is:
  • Unduly costly.
  • Extensive.
  • Substantial.
  • Disruptive.
(42 U.S.C. § 2000gg(7); 29 C.F.R. § 1630.2(p).)
When determining whether an accommodation would impose an undue hardship, the following factors are considered:
  • The nature and net cost of the accommodation.
  • The overall financial resources of the employer.
  • The number of employees employed by the employer.
  • The number, type, and location of the employer's facilities.
  • The employer's operation, including:
    • composition, structure, and functions of the workforce; and
    • geographic separateness and administrative or fiscal relationship of the facility where the accommodation will be provided.
  • For accommodations provided by a specific facility:
    • the financial resources of the facility;
    • the number of employees at the facility; and
    • the effect of the accommodation on expenses and resources of the facility.
(42 U.S.C. § 12111(10)(B); 29 C.F.R. § 1630.2(p).) For more information, see Practice Note, Disability Accommodation Under the ADA: Undue Hardship.
Under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), if it would cause an undue hardship to the employer, the employer is not required to:
  • Make efforts to train or re-train returning services members for reemployment.
  • Accommodate individuals with service-related disabilities.
Under USERRA, an action is an undue hardship if it imposes significant difficulty or expense on the employer, when analyzed using factors substantially similar to those listed above analyzing undue hardship under the ADA (38 U.S.C. 4303(16)). For more information, see Practice Note, Military Leave Law: What Is Undue Hardship?
Under Title VII of the Civil Rights Act of 1964 (Title VII), an employer is not required to make a religious accommodation if it would impose an undue hardship, meaning that granting the accommodation would result in substantial increased costs in relation to the employer's business operations (Groff v. DeJoy, 600 U.S. 447 (2023)).
For more information, see Practice Note, Religious Discrimination and Accommodation Under Title VII: Definition of Undue Hardship.
In bankruptcy, a debtor's student loan, otherwise excepted from discharge under section 523(a)(8) of the Bankruptcy Code, can be discharged by the bankruptcy court if the debtor demonstrates undue hardship by satisfying either:
  • The Brunner test, by demonstrating that:
    • if required to repay their student loans, the debtor cannot maintain a minimal standard of living for themselves or their dependents based on their current income and expenses;
    • additional circumstances of the debtor's life indicate that the debtor's current financial position is likely to persist for most of the student loan repayment period; and
    • the debtor has made good-faith efforts to repay the loans.
    (See Brunner v. New York State Higher Educ. Services, 831 F.2d 395, 396 (2d Cir. 1987).)
  • The totality of the circumstances test, by demonstrating that the debtor cannot now or in the future pay their student loans and maintain a minimal standard of living based on:
    • the debtor's past, present, and future financial state;
    • the debtor's living expenses; and
    • additional facts and circumstances relative to the undue hardship analysis.
    (See Long v. Educ. Credit Mgmt. Corp. (In re Long), 322 F.3d 549, 554 (8th Cir. 2003).)
For more information, see Practice Note, Treatment of Student Loans in Bankruptcy: Undue Hardship Discharge.
In the context of a reaffirmation agreement in bankruptcy, undue hardship is presumed if, for the 60 days after a reaffirmation agreement is filed with the bankruptcy court, the debtor's monthly expenses plus reaffirmed debt exceeds the debtor's monthly income, leaving over less than the scheduled payments on the reaffirmed debt (§ 524(m), Bankruptcy Code).
For more information, see Practice Note, Reaffirmation of Debt in Chapter 7 Bankruptcy: Undue Hardship.