New York Earned Sick Time Act has costly penalties
New York City’s Sick Leave Act was adopted into law in 2013 along with Jersey City, NJ. and Portland, OR. It was revised again in 2014 and in the following 18 months after the grace period ended, over 200 businesses were fined and required to pay restitution of nearly 2.5 million dollars. That included 1.5 million in restitution and over $917,000 in fines. Employers were fined $837,163 in 2015 and in the first four months of 2016, employers were fined 718,888 for non-compliance. All together, that adds up to a lot of lost revenue for business owners. Three years after the law was signed into effect, New York City is still amending and revising their sick leave policy. That leave many business owners feeling vague and unsure about how the most recent amendments apply to their business.
In addition, the Paid Family Leave Act starts in 2018, which will provide up to 12 weeks of paid leave for qualified employees in New York. The Human Rights Act provides protection for victims of domestic abuse to take time off work to pursue medical and legal redress and protection. It is vital that business owners and Human Resource managers understand these laws and abide by them. The purpose of this article is to provide a comprehensive and up to date guide on New York City’s Earned Sick Time Act (Paid Sick Leave Law or ESTA) and how to comply as a business. Read our other articles for more information on other pertinent employment laws in New York City.
Important Dates for Compliance
The Act was signed into effect in 2013. However in March of 2014 more addendum’s were passed, which became effective April 1, 2015. After a 6 month grace period, businesses became fully liable for non-compliance with new provisions of the law.
The Basics of the Paid Sick Leave Act
Sick leave is earned at the rate of 1 hour for every 30 hours worked. Employees can earn up to 40 hours in a 12 month period to use for sick leave. That means that the 12 month period does not have to be a calendar year, but can be a different 12 month period set by the company, including anniversary dates of employment. Employees can roll up to 40 hours to the following year if they don’t use accrued sick leave. However, employers can still restrict sick leave usage to 40 hours in a year.
The Act does provide for a grace period before an employee can start to use the accrued sick leave. 120 days after the date that employment begins, employees can start using their sick leave.
Covered Employees under New York City’s Earned Sick Time Act
Under the 2013 ESTA, only businesses who employed 20 or more employees were required to give sick leave to their employees. However, as of April 1, 2014, all businesses are now required to provide sick leave to their employees. Employers who employ 5 or more employees must provide paid sick leave and employers who employ 1-4 employees must provide unpaid sick leave to their employees. Even employers who employ 1 or more domestic workers must provide sick leave. Domestic workers are allowed up to 2 days of sick leave. That is in addition to the 3 days of paid sick leave awarded by New York State’s Domestic Workers Bill of Rights after one year of service. Additionally, manufacturers, who were previously exempt from the law are now included in the law and must provide mandatory sick leave to their employees.
All employees including full time, part time, temporary, and seasonal employees are covered under the act. However, there are several exceptions to the law.
|# of Employees||Sick Leave Benefit|
|1-4 Employees||Up to 40 Hours of Unpaid Sick Leave|
|5+ Employees||Up to 40 Hours of Paid Sick Leave|
|1 or more Domestic Worker||Up to 2 Days of Paid Sick Leave
(In Addition to the 3 days awarded under the State law after 1 year of Service)
Exclusions to Earned Sick Time Act
New York City’s Paid Sick Leave Law does have a few exclusions to the law. Employees who work less than 80 hours a year are excluded from getting sick leave. Additionally, all publicly employed employees are also excluded. This includes employees of the United States Government, New York State employees and New York City’s employees.
Employees who are participating in a work study program or who are compensated through scholarships are excluded from the sick leave law. Additionally Independent Contractors are excluded. Lastly, certain professionals who are licensed by the New York State Department of Education and who call in for work assignments at will and are paid a premium rate are also excluded. Premium rate is defined as four times the minimum federal wage.
- Federal, State, and City employees
- Employees who work less than 80 hours
- Work Study and Scholarship Employees
- At Will Professionals who are licensed with the Department of Education
Allowable Uses for Earned Sick and Safe Time Leave
New York City’s Sick Leave provides for employees to take sick leave for mental or physical health. Broadly interpreted, employees could theoretically take a sick day for a ‘mental health’ day as the law is fairly vague. Employees are entitled to take sick leave for themselves or for a family member. Employees can use sick leave when they, or a family member, have a mental or physical illness, injury, or health condition.
- To obtain a medical diagnosis, care, or treatment of the mental or physical illness, injury, or condition
- To get preventative care
- If your business or family member’s place of work, school, or child care provider closes for a public health emergency
- The employee’s or family member’s elective surgery, including organ donations (new in 2014)
It is important to note that although New York City’s sick leave law doesn’t provide for safe time usage, New York State’s Human Rights Law provides protections to domestic violence victims who have to take off time from work to address the issue.
Also important is that the ESTA allows employers to discipline employees who misuse sick time off. This includes employees who use sick leave around other scheduled vacation times, holidays, weekends or paydays. It also includes employees who use sick leave when other requested time off has been denied or when the employee takes sick leave and is scheduled for an undesirable shift or to perform undesirable duties.
Family Member Definitions
The definition of Family Member was expanded in 2014 to include more relationships. Currently family members honored under the New York City law include biological, adopted, foster, step, and legal ward relationships. Family members named include spouse, child, sibling (new in 2014), parent, including parent in-laws, grandchildren, and grandparents (new in 2014). Parents and children of a domestic partner are also included as are siblings that are half-siblings, step, and adopted siblings. Lastly children that the employe is in loco parentis are also included as family members. Therefore, employees can take sick leave to help care for any of these family relationships under a qualified reason.
Accrual of Safe and Sick Time
Sick leave is accrued at 1 hour for every 30 hours worked. Employees start to accrue sick leave on the first date of employment, but are restricted from using sick leave until after 120 days of employment. All employees accrue sick leave, although employees of small businesses (1-4 employees) accrue unpaid sick leave.
Temporary Firms and Joint Employment
Employees who work for joint employers will have all of their hours for each employer counted together for purposes of sick leave accrual.
Temporary firms who place employees for employment are solely responsible for ensuring compliance with New York City’s Sick Leave Laws.
Sick Leave Bank and Minimum Usage
New York City’s Sick Leave Act allows employers to require a minimum usage of 4 hours of sick leave for the initial sick leave used. If the employee uses additional time above 4 hours, then the employer can require increments of 30 minutes of sick leave used.
If an employee separates from the employer during the first 120 day probationary period, but reinstates with that employer within 6 months, then the previous amount of time worked counts toward the employee’s probationary period.
If an employee has accrued sick leave and employment is terminated then the employer can choose to pay the accrued sick leave, but does not have to. If the employee is then reinstated within 6 months and the accrued sick leave was not paid out, then the employee is reinstated the previously accrued sick leave at the time of reinstatement.
Employers who do not want to roll over unused sick leave from one year to another can choose to front load and avoid rolling unused sick leave days. There are two ways the employer can do this.
- If the employer front loaded the current year and front loads the next year, then the employer does not need to roll over unused, accrued sick leave days to the following year.
- If the employer is going to front load the next year and the employer pays out the unused accrued sick leave to the employees at the end of the year. (For example if the employer is converting from an accrual to front loaded method)
Coordinating with Paid Time Off Policies
Employers who already provide at least the 40 hours of paid time off each year or 1 hour for every hour worked, and who allow it to be used for the reasons stated in the law are considered to have met the requirements for New York City’s Paid Sick Leave Law. This can include paid time off, paid personal time, vacation time or other paid days off. Employers should review paid time off (PTO) policies to ensure that all the allowable uses in the law are also allowed by the employer’s employment policy.
Reasonable Documentation and Notification of Sick Leave Usage
Employers are allowed to require a seven day notice of sick leave when it is foreseeable. Employers cannot require more than a seven day notice. If the sick leave use is not foreseeable, then employees must provide notice as soon as possible.
Employers can also require documentation that sick leave was used in conjunction with the allowable sick leave uses, anytime sick leave is used. However, employers can only require a health provider’s certification after three consecutive days of sick leave are used. If the employer requires documentation, then the employee has seven days to provide the documentation.
Anti Retaliation Clause
Employees who assert their rights, or attempt to assert their rights under the Paid Sick Leave Law are protected against retaliation from their employer. Employers cannot threaten, discipline, discharge, suspension, or reduction of the employee’s hours. Additionally any other adverse action is also prohibited. This includes retaliation for any of the following actions:
- Requesting and using sick leave
- Filing a complaint for alleged violations of the law
- Communicating with any person, including coworkers, about any violation of the law
- Participating in a court proceeding regarding alleged violation of the law
- Informing another person of that person’s potential rights.
Fines and Remedies provided by the Sick Time Ordinance
Employees have up to two years to file complaints if they feel that their rights have been violated. The law provides for civil fines with violations. The first violation is punishable by up to a $500 fine. Second violations can be fined at $750 and subsequent violations can be fined up to $1,000 per violation.
In addition, the Department of Commerce can also assess damages for each violation. Each time the employee takes sick leave and is not paid, the damages are to be three times the missed wages or $250, whichever is greater. Every instance that the employee requested, but wasn’t allowed to take sick leave is punishable by $500. Every instance that retaliation occurred against the employee, damages paid to the employee include full compensation, including missed wages and benefits, and $500 equitable relief. For every instance of discharge, damages include full compensation including lost wages and benefits, $2,500 and equitable relief, including reinstatement.
- The employee takes sick leave, but isn’t paid = the greater of 3 times the missed wages or $250
- The employee requests sick leave, but isn’t allowed to take it = $500
- Retaliation against an employee= full compensation, lost wages, plus $500 and
- If discharge from employment= full compensation, lost wages and $2,500
Notification and Records
As of 2014, employers must notify both existing and new employees of the sick leave laws. Employers must draft and distribute sick leave policies and must follow those policies. At a minimum, sick leave policies must include the employer’s method of accrual or front loading sick leave, describe the employer’s policies regarding sick leave usage, and discuss the employers carry over policy for unused sick leave. Further, employers must state if their policy requires any documentation of sick leave use and any policy regarding disciplinary action of misuse of sick leave time.
Employers are required to provide notice to employees in their native language, provided that the Department has released the notifications in that language. Employers must also provide notice in English.
Employers must also maintain records for three years. Employer records must be very detailed and must be available upon request. Records must include the employee’s name, address, phone number, start and end dates of employment, pay rate and if the employee is exempt from New York State’s overtime requirements. Records should include the hours worked by the employee each week, the date and time of the sick leave usage and the amount paid for that time. Records must also show any change in the material terms of employment specific to the employee. Lastly, the employer must maintain records of the date that the Notice of Rights were provided to the employee and proof that it was received by the employee.
Employers might assume that employees exempt from Federal Overtime Rules or New York State’s Overtime are exempt from the record keeping aspect of the law. However, this doesn’t appear to be the case as all employers are required to record and maintain record of whether an employee is exempt or not.
Let SwipeClock Help
Businesses who have employees in New York have to comply with multiple employment benefit laws, and will soon have to comply with the New York FMLA law. Additionally, these businesses have to also comply with Federal Overtime Laws, the Family Leave Medical Act and any other national or local laws that are enacted. SwipeClock provides a comprehensive array of workforce management and time tracking tools that can help businesses to more easily stay in compliance with local and national laws. Records are effortlessly kept for years and accrual is automatically tracked and reported to employees according the state and city laws. Additionally, with geo-timekeeping clocks, businesses can effortlessly track time worked in specific cities to ensure compliance.
SwipeClock is a leading provider of cloud-based integrated workforce management solutions that include automated time and attendance, advanced scheduling, and leave management capabilities. The company’s products, including TimeWorks Plus, Time Simplicity, and Workforce Management Clock enable employers to manage their most important and expensive asset-employees-by transforming labor from a cost of doing business to a competitive advantage. SwipeClock’s workforce management solutions are sold through over 850 partners that empower more than 26,000 businesses to lower labor costs, comply with regulatory mandates, and maximize their profits. For more information, please visit www.swipeclock.com.
Written by Annemaria Duran. Last updated January 11, 2017