Passaic Paid Sick Leave Law: Nuts and Bolts for Business

Passaic City jumps on the Sick Leave Bandwagon

Effective January 3, 2015, most Passaic employees obtained the right to paid sick days. The new ordinance is officially called “An Ordinance to Add a New Chapter to the Ordinances of Passaic to Promote the Overall Health and Safety of the Residences and Workers of the City of Passaic by Reducing the Spread of Communicable Disease and Contagion by Requiring a Policy of Paid Sick Leave  for Workers In Passaic.” Unofficially, the Ordinance is known as the Passaic Earned Sick Leave Law.

Passaic joined with East Orange, Irvington, and Paterson with implementing sick leave laws in 2014. The ordinance provides paid sick leave to employees of private businesses. Passaic city employees are exempt. Up to 40 hours (5 days) of sick leave is awarded to large businesses, those who employ 10 or more employees. Smaller companies and employers must provide up to 24 hours (3 days) of sick leave to their employees. There are some exceptions, such as child-care workers, home health care and food service workers, who also get up to 40 hours, regardless of the employer’s size. It is important to note that although the ordinance applied to Passaic City businesses, it also applied to any employee who works inside of city limits for at least 80 hours a year. This means that out of state employers, as well as foreign employers, must be aware of these laws if any employee lands in Passaic for 80 hours or more each year, or roughly 1 ½ hours a week. This would include sales reps, regional employees, and drivers who pass through the city in route.

Accrual of Earned Sick Time

Employees earn paid sick leave of 1 hour for every 30 hours worked. Large businesses, who have more than 9 employees, are required to provide up to 40 hours of paid sick leave in a year. Small employers must provide up to 24 hours of sick leave, unless they fall under one of the special industries: child care, home health care, and food service. It’s important to note that employee count is the determining factor, even if the employees are part time or temporary employees. Employee count is not based on Full Time Equivalent (FTE)  

Business Size Hours of Sick Leave Available Each Year
10+ employees 40 hours of paid sick leave a year
<10 employees 40 hours of unpaid sick leave a year
*Industry exception, regardless of business size Any Child-care, home health care, or food service worker can earn 1 hour for every 30 hours worked up to 40 hours a year.

 

Calculating the Business Employee Size

All employees count toward the employer size including full, part time and temporary employees. To calculate the size of the business, when the employees fluctuate, business can calculate the average number of employees employed during the previous year. The ordinance doesn’t define full time equivalent (FTE) as a means of calculating employee size so it appears that all employees count equally as an employee count. This means that a business with 11 part time employees is considered to be a large business, even though the FTE may land at about 4.5 FTEs.  This is an unusual precedence in New Jersey that is contrary to other sick leave laws throughout the country. Employers who are based elsewhere need to be aware of this.

Paid Sick Leave Accrual

The Passaic ordinance allows businesses to define the calendar year. It can be any consecutive 12 months that the business defines. Managers should inform employees if the accrual year is different than the standard calendar year of January through December.

Exempt employees, according to the definitions of the Fair Labor Standards Act, are assumed to work a 40 hour week and are exempt from overtime. Unless an exempt employee regularly works less than 40 weekly hours, they will accrue sick leave based on a 40 hour week. If an exempt employee’s regularly works less than 40 hours a week, in which case that employee will accrue sick leave based on their normally worked hours.

Employees can roll up to 40 hours of unused sick leave to the following year. However, employees are still restricted from using more than 40 hours of sick leave each year. Rolling sick leave provides a method for employees to use sick leave early in the year, before additional sick leave has been accrued. Businesses can choose to avoid rolling sick leave to the next year if they payout unused, accrued sick leave at the end of the year.

Covered Employees under the Paid Sick Leave Ordinance

Passaic Earned Sick Leave Ordinance covers all businesses operating within city limits. Additionally, the ordinance also covers all employees who work inside city limits for at least 80 hours a year. These occasional-basis employees only need to average 1 ½ hours in the city to be covered. This means that companies who operate outside the city, state and even the USA are accountable under the new ordinance if any employees pass through Passaic. It is vital that employers who have employees who operate on an occasional-basis in the township maintain accurate records of time spent inside the city. All privately held businesses are covered, as are families and single employee employers. This includes temporary and seasonal employees, as well as full time and part time employees.

Exceptions to Earned Sick Time

Passaic City excludes themselves and all other government employees, including Federal, State and Local governments. In addition, education employees are exempt and are defined as an employee of any school district or the board of education. Lastly, all construction union employees are also exempt. Construction Union employees are all industries of reconstruction, demolition, alteration, custom fabrication, or repair work. Additionally those employees must be enrolled or have graduated from a registered apprenticeship program.

Allowable Uses for Earned Sick Leave

Passaic allows sick leave for the same reasons as surrounding townships in New Jersey. This makes it easier for New Jersey businesses, with employees in multiple locations, to modify existing sick leave policies. Sick leave covers mental and physical illnesses, health conditions and injuries. Employees can seek a diagnosis, obtain medical care, treatment, and get preventative care. Sick leave covers both the employee’s need and their family member’s need. Plus, if the employee’s place of business is closed due by order of a public health official due to a public health emergency, sick leave can be used. If a child’s or family member’s school or place of care is closed by a public health official, then the employee can also take sick leave. In the event that a public health employee determines that the presence of the employee, child, or family member would jeopardize  the health of others because of exposure to a communicable disease, then the employee can take time off to care for them. This is applicable, even if the family  member or employee has not actually contracted the disease. There are no specific provisions for victims of domestic violence, sexual assault or stalking to seek legal redress or to relocate for safety. Presumably any physical or mental injuries could be covered under the above reasons, even if not specifically stated.

  • Mental or physical illness: to care for, diagnos, obtain treatment, or preventative care.
  • If the business, place of care, or school has been closed due to a public health emergency
  • If the employee or family member has had exposure to a communicable disease, even if the employee or family member hasn’t contracted the disease.

Family Member Definitions

The Earned Sick Leave Ordinance recognizes children, parents, partners, grandparents, grandchildren and siblings, However, the exact nature of the relationship differs for each of those family members. For children, Passaic recognizes all biological, foster, adopted, step, legal ward and in loco parentis relationships. Children of a domestic partner or a civil union are also recognized. For parental relationships, it recognizes biological, foster, step, adoptive, legal guardians and in loco parentis relationships. In-law relationships are recognized, as well as parents of a domestic partner or civil union partner. Sibling relationships are recognized, but not specifically the other types of sibling relationships, including sibling-in-law. Grandparents and Grandchildren are recognized. Grandparents’ partners, spouses, and civil union partners are recognized.  

  • Child: biological, adopted, step, foster, child of a domestic partner or civil union
  • Parent: biological, adopted, step, foster, parent or foster parent of a domestic partner or civil union and parent in law.
  • Spouse: domestic partner or civil union partner
  • Grandparents: including spouses and partners of grandparents.
  • Grandchildren
  • Siblings

Sick Leave Bank and Minimum Usage

Earned sick leave accrual starts on the first date of employment. However, employees are restricted from using sick leave until their 90th calendar day after employment begins. The one exception to this is returning or reinstated employees.

Terminated employees, both voluntary and involuntary, retain a sick leave bank for 6 months after employment termination. If the employee is reinstated with the same employer within 6 months, then all previously unused, accrued sick time hours are reinstated to the employee. Plus that employee is eligible to immediately start using sick leave and does not have to pass through another 90 day grace period. The law is silent about employees who left their employer during the original 90 day grace period and whether or not they have to complete the original 90 day period. Upon the termination of employment, businesses are not required to payout sick leave.

Sick leave can be taken in hourly increments or in the smallest time increment that other absences are accounted for on the payroll system.

Employers are allowed to lend sick leave hours to employees before accrual of hours and are under no liability for choosing to do so. Employers who deny a request to loan sick leave are also under no liability. Sick leave hours transfer to a new owner or successor employer. Accrued hours also transfer with employees who transfer within the same company.

Coordinating with Existing Time Off Policies

The Passaic Ordinances doesn’t prohibit more generous paid time off policies. Employers who have existing paid time off policies that meet or exceed the ordinance don’t have to provide additional sick leave time. However, the existing policies must allow for sick leave to be used for all the reasons allowed in the law and must provide accrual at the rate of at least 1 hour for every 30 hours worked, up to 40 hours. HR managers and Payroll Professionals with existing leave policies should examine their guidelines to make sure that all allowable reasons for leave in the sick leave law are also allowed in the company’s policy. Employers should also make sure that their policies include the notification required by law.

Reasonable Documentation and Notification of Sick Leave Usage

Employers can request written confirmation from an employee that sick leave was used for acceptable purposes. After an employee has used 3 or more consecutive days of sick leave, then the manager can require documentation by a health care provider that sick leave was necessary. The statement cannot disclose the nature of the sick leave.

Employees must also provide reasonable notice when sick leave is foreseeable. However, employers can’t require notice of more than 7 days for sick leave.

Anti Retaliation

Passaic protects employees from any kind of retaliation under the law. Employees can exercise their rights of paid sick leave and cannot be prohibited from attempting to exercise their rights. They can file complaints, work with the Agency in investigations, participate in any judicial action relating to the act and inform others of their rights under the act. Employees are protected from any sort of threat, discipline, discharge, suspension, demotion, reduction or hours, or any other adverse action. This includes protection for employees who communicate with coworkers about a violation of the law.

Notification and Records

Employers must provide a notification of employees rights under the sick leave law when new employees are hired. Additionally employers must post notification in a conspicuous place where the employee’s work. The notices and posters must be in English and any other first languages spoken by more 10% or more of the employees. Passaic City provides notices in both English and Spanish.The notice has to include the right to sick leave, accrual rate, amount of sick time available for accrual, and the terms of its use. Additionally notification must include the rights of the employee against retaliation and the right to file a complaint.

Fines and Remedies provided by the Sick Time Ordinance

Businesses are fined $2,000 per violation. Each day is considered to be a new infraction. Additionally, employers are subject to restitution to the employee including restitution, reinstatement, injunctive and declaratory relief. Employees can file with The Department of Health and Human Services, as well as filing a civil suit.

Time and Attendance and Record Retention

Passaic City requires that employers maintain records of hours worked by employees, as well as sick leave accrual and usage. However, the ordinance doesn’t define how long employers should keep records or what specifics should be kept in the records. Yet, the Ordinance also presumes a violation of paid sick leave laws if employers do not maintain good records. This makes it crucial for business owners and managers to maintain consistent and detailed records. Manual timekeeping is more easily altered and lost than automated time and attendance records, including employee information, hours worked, sick leave accrual and usage. Businesses should also have written documentation of sick leave requests as well as a written employee handbook.  Most local and state ordinances across the country require 3-4 years. Business owners should consider maintaining records for at least that long. It is more important than ever that companies have an electronic timekeeping system that provides accurate and automatic records. This can help the company to stay compliant with employment laws and to avoid fines and penalties.

Let SwipeClock Help

Businesses who have employees in more than just Passaic may have to comply with multiple conflicting City ordinances defining Sick leave accrual and usage laws. 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.

About SwipeClock

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.

Resources

Passaic City Earned Sick Leave Ordinance

Passaic City Notices for Employers

Written by Annemaria Duran. Last updated on Feb 22, 2017