Remember when we all thought the paid leave law that passed the State Legislature in September and doesn’t become effective until 1/1/21 was something to worry about?

Even though those worries have been subsumed by everything else going on, the legislation is still chugging along. Today, the DOL issued its rules to implement that legislation. The public comment period on the rules remains open until April 27, 2020.

Please keep in mind that this law has nothing to do with the recent laws we have been focusing on for the past week, the amended FMLA and federal paid sick leave.

Here are some definitions:

  1. The rules apply to employers that employ 10 or more employees in the usual and regular course of business for more than 120 days in any calendar year, with certain exceptions.
  2. 120 days means 120 calendar days, not business days.
  3. Base rate of pay means the regular rate of pay and will be calculated by reference to the week immediately prior to the leave taken.
  4. Employee includes full-time, part-time, or per diem.
  5. The law excludes seasonal employment. That term is determined by the unemployment commission’s definition of seasonal.

You recall that the law entitles an employee to earn one hour of earned paid leave for every 40 hours worked, up to 40 hours in one year of employment. The regulations state that no more than 40 hours of earned paid leave is required to be available to an employee during any one-year period. That appears to mean that if an employee has accrued unused leave time, this law does not entitle that person to use that leave over and above 40 hours unless the employer permits it.

The law also does not require an employer to allow an employee to accrue more than 40 hours in the current year of employment. It sounds as though this time, if accrued but not used at the time of termination, must be paid out similar to other accrued and unused vacation time. Unless there is an emergency, illness, or other sudden necessity for the leave, an employer may have a written policy requiring up to 4 weeks’ notice of the employee’s intent to use the leave.

That is a significant clarification as to how the leave can be used. For this non-emergency leave, an employer may place reasonable limits on the scheduling of the leave to prevent undue hardship on the employer as reasonably determined by the employer.

Undue hardship is now defined as a significant impact on the operation of the business or significant expenses. Considering the financial resources of the employer, the size of the workforce, and the nature of the industry. Notice for an emergency, illness, or other sudden necessity must be reasonable under the circumstances.

For purposes of the law, “emergency” and “sudden necessity” mean “a situation in which the need for leave is not reasonably foreseeable. The leave is to be used in increments of one hour unless the employer permits smaller increments.

Notably, in today’s environment, the rules say that the employer cannot require the employee to use the accrued time when the employer causes the employee to be unable to perform their job such as by closing the business or canceling a shift. These are brand new and we will continue to assess what they mean.

Since the proposed rules are now out, employers should begin thinking about how policies will change and be re-written to comply with them. That should not be done at least until the comment period is over and the final rules are issued. In the meantime, there is plenty else to do! If you want to review them, the draft rules can be found here.

This information is accurate as of March 26, 2020. It is subject to change based on any new legislation.

Anne-Marie L. Storey, Attorney at Law, Rudman Winchell
Anne-Marie Storey, Esq
Rudman Winchell

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