[co-author: Jamie Moelis, Legal Intern*]
As detailed previously here, the New Jersey Paid Sick Leave Act (the “Act”), goes into effect October 29, 2018. In general, the Act allows New Jersey employees to accrue one (1) hour of sick leave time per thirty (30) hours worked, and allows New Jersey employees to use earned sick leave time for: (i) diagnosis, care, treatment of, or recovery from the employee’s mental or physical illness, injury or other adverse health condition, or for the employee’s preventive medical care; (ii) time to aid or care for a family member in one of the situations described in (i); (iii) time needed due to an employee’s or family member’s status as a victim of domestic or sexual violence; (iv) closure of the workplace, school, or childcare facility issued by a public health authority due to a public health emergency; and (v) a school-related conference or meeting. A detailed summary of the Act’s other requirements can be found here.
In connection with the Act going into effect, the New Jersey Department of Labor and Workforce Development (the “NJDOL”) recently issued proposed regulations regarding the implementation of the Act (available here). Below please find a summary of key proposed regulations which address many questions New Jersey employers may have about the implementation of the Act in their workforce:
Existing PTO Policies: The proposed regulations provide that an employer’s existing paid time off (PTO) policy will be deemed to be in compliance with the Act if it complies with the accrual, use, payment, and carry over provisions of the Act.
Recordkeeping: The proposed regulations also provide that employers are required to retain for a five (5) year period all records documenting hours worked by employees and earned sick leave accrued, advanced, used, paid, paid out, and carried over. However, the record keeping requirement generally does not apply to exempt employees.
Required Notice and Posting Requirement: The proposed regulations further provide that employers must conspicuously post in a place or places accessible to all employees in each of the employer’s workplaces, the notification issued by the NJDOL (available here). The conspicuous posting requirement can also be met by posting the notice on the company’s intranet site or by emailing the notice to all covered employees.
Benefit Year: The proposed regulations provide that an employer must establish a single benefit year for all employees. In the event an employer proposes to change the benefit year, the employer must provide notice to the NJDOL at least thirty (30) calendar days prior to the proposed change. The notice must: (i) be in writing; (ii) specify the existing benefit year; (iii) specify the proposed new benefit year; (iv) indicate the effective date of the new benefit year; (v) indicate the reason for the change in the benefit year; and (vi) provide a list of current employees with corresponding contact information and a history of accrual, use, payment, payout, and carry-over of earned sick leave for each employee for the proceeding two (2) benefit years.
Foreseeable Need. The proposed regulations also provide that an employee’s use of earned sick leave is considered “foreseeable,” when the employee is able to predict or know in advance that he or she will need to use earned sick leave, such as a scheduled doctor’s visit, a regularly occurring medical treatment, or a regularly scheduled therapy appointment. Leave for foreseeable need requires no more than seven (7) days’ advance notice. Conversely, the need to use earned sick leave is considered “not foreseeable” when an employee requires time to care for, or obtain medical treatment for, themselves or a family member that was not reasonably anticipated. An example of an earned sick leave that is “not foreseeable” is when an employee wakes up in the morning with a fever and does not feel well enough to report to work.
Dates Where Use of Sick Leave Not Permitted. The proposed regulations provide further that an employer can prohibit the foreseeable use of paid sick leave on “certain dates” such as verifiable high-volume periods or special events, during which permitting the use of foreseeable earned sick leave would unduly disrupt the operations of the employer. The employer should provide reasonable notice to its employees of such “certain dates” on which its employees are prohibited from using foreseeable sick leave.
Reasonable Documentation. The proposed regulations also provide that an employer may require an employee seeking to use paid sick leave for an unforeseeable purpose on one of the “certain dates” discussed above to provide reasonable documentation that the leave is being taken for a permissible purpose under the Act. Additionally, an employer may request reasonable documentation when an employee uses earned sick leave for three (3) or more consecutive days.
Rate of Pay. The proposed regulations provide that the employer must pay the employee for earned sick leave at the same rate of pay as the employee normally earns.
Where an employee has two (2) or more different jobs for the same employer or if an employee’s rate of pay fluctuates for the same job, the rate of pay for earned sick leave shall be the amount that the employee is regularly paid for each hour of work as determined by adding together the employee’s total earnings, exclusive of overtime premium pay, for the seven (7) most recent workdays when the employee did not take leave and dividing that sum by the total hours of work during that seven-day period.
Where an employee is paid by commission, whether base wage plus commission or commission only, the employer must pay the employee during earned sick leave an hourly rate that is the base wage or the State minimum wage rate, whichever is greater.
When an employee is paid on a piecework basis, whether base wage plus piecework or piecework only, to calculate the employee’s rate of pay for earned sick leave, the employer shall add together the employee’s total earnings for the seven (7) most recent workdays when the employee did not take leave and divide that sum by the number of hours the employee spent performing the work during workdays.
Penalties. An employer who knowingly and willfully violates the Act will be subject to a fine of not less than $100 and no more than $1,000 and/or not less than ten (10) days and no more than ninety (90) days of imprisonment for the first offense. Upon a second offense or subsequent violation, the violator will be punished by a fine of no less than $500. Additionally, the NJDOL may assess administrative penalties in the amount of $250 for the first violation and between $250 and $500 for a second violation. Each week during which an employee has not been provided the prescribed amount of earned sick leave would constitute a separate offense under the Act.
A public hearing on the new rules will be held on November 13, 2018 and written comments will be accepted by the NJDOL until December 14, 2018. While the proposed regulations will not be in effect when the Act goes into effect on October 29, 2018, New Jersey employers should keep such proposed regulations in mind when implementing their paid sick leave policies by October 29, 2018.
* Jamie Moelis, a legal intern, assisted in the preparation of this blog.