New York City Passes Earned Sick Time Act

June 13, 2013

On May 8, 2013, the New York City Council passed the Earned Sick Time Act (the “Act”), which requires private employers in New York City to provide mandatory paid, and in some instances unpaid, sick time to their employees.

The City Council passed the Act by an overwhelming vote of 45-3. This margin is important because it indicates that the City Council will comfortably have the two-thirds majority needed to override the veto Mayor Michael Bloomberg has vowed to make.

Once the Act takes effect, New York City will join Washington D.C., Seattle, Portland, San Francisco, and the State of Connecticut in passing legislation that imposes paid sick leave obligations on employers.

Brief Summary of the Act

The Act will take effect on April 1, 2014, and will require employers with twenty employees or more to provide their employees with at least five days of mandatory paid sick time. This includes all employees who work more than eighty hours in a calendar year, whether on a full-time, part-time, or temporary basis.

Beginning April 1, 2014, employers with fifteen or more employees, or one domestic worker, will be required to provide their employees with at least five days unpaid sick time until October 1, 2015. On this date, the Act will require that employees be provided with at least five days of mandatory paid sick time.

Employers with less than fifteen employees, or employers with fifteen or more employees whose employees do not meet the eighty-hour threshold are not covered by the Act, but will be entitled to unpaid leave.

For non-domestic employees, both paid and unpaid sick time will accrue at a minimum of one hour for every thirty hours worked. Accrued sick time will be capped at forty hours per calendar year. Non-domestic employees begin accruing sick time at the start of their employment, or on the date the Act takes effect, whichever is later. Domestic employers are subject to a special accrual rate.

All non-domestic employees are permitted to carry over any unused sick time into the following year, but employers are allowed to cap the amount of accrued sick time at forty hours in a given calendar year. The Act does not require employers to pay for any unused accrued sick time at separation.

Accrued sick time can only be used by non-domestic employees for specific absences listed by the Act. Employers may require reasonable notice of employees’ intent to use sick time if the leave is foreseeable, and require documentation to confirm compliance with the Act.

Employers covered by the Act who already have a policy in place that provides paid leave, including paid time off (PTO), that meet the requirements of the Act, will not be required to provide additional sick time to employees. The Act does not apply to employees that are covered by a valid and enforceable collective bargaining agreement that expressly waives the provisions of the Act, and provides comparable sick time benefits.

At the time of hire, employers must provide employees with a written notice that the employees are entitled to sick time under the Act. The Department of Consumer Affairs will prepare model notices in both English and the employee’s native language if available. Records documenting the employer’s compliance with the Act must be maintained for at least two years.

Enforcement and Penalties

Any employees alleging a violation of the Act may file an administrative complaint, which will be subject to an investigation by the Department of Consumer Affairs.
Penalties for violations of any of the provisions of the Act include lost wages, reinstatement, and civil penalties not to exceed $500 for the first violation, $750 for a second violation within two years of a prior violation, and $1,000 for subsequent violations that occur within two years of any previous violation. Any retaliation against employees for using paid or unpaid time as provided by the Act is prohibited.

Once the Department of Consumer Affairs has made a decision, an employee can only bring an action in court to contest the agency’s determination.

Employer Preparation

All New York City employers need to familiarize themselves with the requirements of the Act so that they will be in compliance with the Act on April 1, 2014. Employers with PTO or other comparable leave policies should review their current policies and practices to see if they are in compliance with the Act.

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