The 10 Most Frequently Asked Questions and Answers About New Jersey’s New Paid Sick Leave Law

Fall brings requests for time off for school conferences.  Winter brings absences for colds and flu.  The New Jersey Paid Sick Leave Law (the “Sick Leave Law”) provides paid sick leave to virtually every New Jersey employee to attend to these needs.  The Sick Leave Law became effective on October 29, 2018, and requires all New Jersey employers, regardless of size, to provide paid sick leave for full-time, part-time, casual, and seasonal employees.  Sick leave may be used for the employee’s own medical condition, or the medical condition of the employee’s family member.  Employees may also use paid sick leave for absences due to public health emergencies and absences related to domestic violence suffered by the employee or the employee’s family member.  Finally, paid sick leave may be used by the employee to attend school conferences and events. Employers may choose to either allow employees to accrue sick leave at a rate of 1 hour for every 30 hours worked, up to a maximum of 40 hours per year, or “frontload” the 40 hours of sick leave at the beginning of the benefit year.

In this article, we explore the 10 most frequently asked questions we have been receiving in assisting employers to comply with the requirements of the new law:

  1. When do employees accrue sick leave and how soon may they start using it?

The law and the proposed regulations conflict on this issue as it pertains to current employees. The statute states that for employees who were hired before October 29, 2018, earned sick leave begins to accrue on October 29, 2018. The current employee can use his or her earned sick leave 120 calendar days after his or her start date. This means that current employees can use paid sick leave as soon as it is accrued, and if an employer frontloads the full entitlement of paid sick leave, then the employee can use that leave immediately.

The proposed regulations, however, provide that current employees cannot use paid sick leave until the 120th calendar date after the employee commences employment, or February 26, 2019, whichever is later. We have the statute, on one hand, that allows current employees to use their accrued paid sick leave immediately, and the proposed regulations, which state that they must wait until February 26, 2019.  How do employers comply with the Sick Leave Law considering this conflict?  There is no clear-cut answer, but instead employers must look at their current PTO policies and benefit year.  Employers must also determine if any segment of the workforce is receiving less than the full complement of leave provided for under the law (and not the proposed/draft regulations).

The statute and regulations are consistent with respect to new hires.  Employees hired after October 29, 2018, accrue paid sick leave immediately on the employee’s first day. New employees cannot use accrued paid sick leave until the 120th calendar day after the employee commences employment.

  1. Do I need to take any action if I already offer paid time off (“PTO”)?

It depends.  An employer’s PTO policy will only be compliant with the Sick Leave Law if the employer provides at least the minimum amount of sick time as required by the Sick Leave Law (1 hour of paid sick leave for every 30 hours worked). An employer may offer a more generous PTO policy; however, the policy must meet or exceed all the requirements of the Sick Leave Law and allow employees to use the time for all the reasons permitted by the law.

  1. What is the interplay between the Sick Leave Law, the federal Family and Medical Leave Act (FMLA) and the New Jersey Family Leave Act (NJFLA)?

The FMLA provides 12 weeks of unpaid job-protected leave for employees suffering from a serious health condition or for the care of a family member with a serious health condition. Similarly, the NJFLA provides 12 weeks of unpaid job-protected leave for employees to care for a newly born or adopted child, or for the care of a family member with a serious health condition. When an employee is eligible to care for a family member under both FMLA and NJFLA, the leave may run concurrently pursuant to the employer’s policy.

The Sick Leave Law may also be used for illness by the employee or the employee’s family member. The Sick Leave Law, however, limits leave up to 40 hours, and, unlike the FMLA and NJFLA, the time off is paid. It is feasible that situations may exist where the Sick Leave Law runs concurrent with either FMLA or NJFLA, or both. Notably, the Sick Leave Law carries with it an extremely broad definition of “family member,” which includes anyone “whose close association with the employee is the equivalent of a family relationship.” This means that New Jersey employees may use paid sick leave to care for a person, regardless of biological or legal relationship. This allows employees to take leave to care for individuals not covered as family members under the FMLA and NJFLA.

Another important distinction is that unlike the FMLA or NJFLA, the Sick Leave Law may not be used to bond with a newborn or newly adopted or fostered child.  In addition, FMLA and NJFLA take precedence when they require employers to do more than the Sick Leave Law.

Finally, the FMLA and NJFLA only apply to employers that meet certain criteria and only eligible employees (based on length of service and hours worked) are entitled to take FMLA and NJFLA leave.  The Sick Leave Law applies to almost all New Jersey employees and employers, so employees ineligible for FMLA or NJFLA will likely be entitled to paid sick leave, particularly those employed by small businesses.

  1. If my municipality already has a paid sick time law, does the new law affect my
    workforce?

Yes. The new law fully preempts and displaces the municipal ordinances that previously provided paid sick leave in 13 municipalities in New Jersey.

  1. Can employers require that employees provide notice when taking sick leave?

            Yes and No. Employers can require that employees provide up to 7 days’ notice of “foreseeable” absences. Foreseeable absences include time off for scheduled medical appointments. Where the need for leave is unforeseeable, an employer may only require notice “as soon as practicable,” and only if the employer has notified the employee, in advance, of this notice requirement.

Employers may only require documentation to substantiate the need to sick leave under two circumstances: 1) when the employee is absent for 3 or more consecutive days or 2) when the employee is absent during established “black-out dates.” Blackout dates must be limited to verifiable high-volume periods or special events (like the winter holidays). Importantly, employers must provide notice to employees of these backout dates.

  1. If we offer a more generous PTO policy than the law requires, are we exempt from the law’s carry-over provision?

          No. Employers whose employees accrue PTO in excess of the law’s requirement are still required to carry-over a maximum of 40 hours paid leave to each new benefit year. An employer is not required to carry over more than 40 hours paid leave per year.

  1. Are employers required to change the “benefit year”?

          Employers are required to establish a single benefit year (the 12-month period in which employees accrue or are frontloaded paid sick leave) for all employees. Employers who calculate PTO based on the employee’s anniversary date can no longer do so if that PTO is being used for paid sick leave. This requirement also means that employers must work closely with payroll to address accrual dates.

The law also requires that if employers seek to change the benefit year they must provide at least 30 calendar days’ notice to the Commissioner of the NJDOL. Employers are not required to provide notice to the Commissioner of the initial establishment of a benefit year.

  1. What happens to unused sick time at termination?

            Employers are not required to payout for unused sick time at termination unless a company policy or a collective bargaining agreement provides for payout. Employers should update their policies to unambiguously provide that accrued and unused paid sick leave will not be paid out at termination.

  1. The law only exempts construction employees subject to a collective bargaining agreement, public employees who are provided with sick leave, and per diem health care employees. What constitutes a per diem health care employee?

          This is another great example of where the law and proposed regulations contradict. The statute defines “per diem health care employee” as any New Jersey licensed health care professional (or license applicant) employed by a facility licensed by the New Jersey Department of Health or any first aid, rescue, or ambulance squad member employed by a hospital system, who fulfills the following three qualifications: (1) works on an as-needed basis to supplement a health care employee or to replace or substitute for a temporarily absent health care employee; (2) works only when the employee indicates that the employee is available to work, and has no obligation to work when the employee does not indicate availability; and (3) either (a) has the opportunity for full time or part-time employment under that healthcare provider or (b) has waived earned sick leave benefits for alternative benefits or consideration. So, under the law, a per diem health care employee must meet an exceedingly high standard to be exempt. However, the proposed regulations eliminate the three qualifications.

          Whether this departure from the law was intentional or a mere scrivener’s error is unclear and we await the publication of the final regulations. For now, the statute controls.

  1. Does the new law impose additional recordkeeping and compliance requirements?

Yes. Employers must post the NJDOL’s required notice in a conspicuous place, accessible to all employees in each New Jersey workplace. In addition, employers must distribute the notice (1) to all existing employees by November 29, 2018; (2) at the time of hiring; and (3) if the employee requests a copy of the notice. The required notice may be distributed by email. Employers are not required to obtain signed acknowledgments confirming that employees received the notice.  Significantly, employers must distribute the notice in English and if the employee’s primary language is other than English, the employer must also provide the notice in the employee’s primary language.

Employers must also maintain records documenting the hours worked and earned sick leave used by employees. Records must be maintained for 5 years and made available for inspection by the NJDOL. If an employee claims an employer violated the Act, and that employer has failed to maintain adequate records, then the law creates a presumption that the employer failed to provide paid sick leave.

Bottom Line

The answers to the questions above are based on a review of the FAQs and proposed regulations released by New Jersey Department of Labor and Workforce Development (NJDOL). Employers reviewing the draft regulations for guidance may also find that some of the sections contradict the Sick Leave Law. The proposed regulations are not binding and are open for public comment until December 14, 2018.  We will continue to monitor developments and will provide an update once the final regulations are released by the NJDOL.

In the meantime, employers should work closely with counsel to address the specific needs of their workplace.  In addition, employers must adhere to the notice and recordkeeping requirements, and review and revise existing policies, practices and procedures related to calculating employee’s sick leave to ensure compliance with the new law.

For more information please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at  jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777

“Pass the Trash” Compliance Update

Private employers (“Employers”) holding contracts with New Jersey school districts and charter schools are reminded that it is now time to comply with the extensive background check requirements under the New Jersey “Pass the Trash” Act (the “Act”) in order to screen applicants and employees for child abuse and sexual misconduct in their former employment.  This law became effective on June 1, 2018, and requires employers/independent contractors to conduct a 20 year employment review of its applicants and employees who will have “regular contact with students.”  This employment review requires employers to:

  • Request information from the applicant/employee about child abuse and sexual misconduct with current and former employers for the last 20 years;
  • Collect the names, addresses, telephone numbers and relevant contact information of an applicant’s current and former employers for the 20 year time span, where the applicant/employee worked for a school or in a position that involved direct contact with children and inquire about child abuse and sexual misconduct.
  • Obtain authorizations from applicants to conduct the employment review;
  • Contact any out-of-state employers with whom the applicant/employee held a position involving regular contact with students; and
  • Update employment applications for positions that involve regular contact with students to include the penalties for applicants who provide false information. The penalties include termination or denial of employment and fines up to $500.

In addition to its affirmative obligation to conduct an employment review for child abuse and sexual misconduct, New Jersey employers will also be on the receiving end of these inquiries.  If an employer receives a request for information under the Act, it must respond within 20 days and disclose the requested information. Failure to do so may be grounds for the applicant’s automatic disqualification from employment. Importantly, the Act provides immunity to Employers who provide the requested information in good faith.

Employers who do business with New Jersey school districts or charter schools should review and revise existing hiring policies, practices and procedures to ensure compliance with the Act.  Human Resources personnel should also be trained on these new legal requirements to ensure that internal hiring processes and employment applications are updated to comply with the Pass the Trash Act.

For more information about the potential impacts of the “Pass the Trash” Act or forms your company can use to comply with this new law, please contact Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, 973-533-0777 or Brigette N. Eagan, Esq., Counsel in the Human Resources Practices Group at beagan@nullgenovaburns.com, 973-535-7114.

NJLAD Amendment to Protect Nursing Mothers in the Workplace

Since 2010, the Fair Labor Standards Act (“FLSA”) requires employers to provide reasonable break times for nursing mothers to express breast milk.  These break times must be provided for up to 1 year after the birth of the child.  On January 8, 2018, New Jersey’s Law Against Discrimination (“NJLAD”) was amended to include a similar requirement.  The NJLAD now requires all New Jersey employers to provide lactation breaks, regardless of the employer’s size and number of employees.

This new amendment to the NJLAD makes it a civil rights violation for an employer to terminate or discriminate against a female employee who breastfeeds or pumps milk on the job. The amendment also imposes a reasonable accommodation requirement, where employers must reasonably accommodate employees with daily break times and a suitable room or other location with privacy so that she can express breast milk for her child. This room must be in close proximity to the employee’s working area. However, it is not required that these breaks be paid, unless the employee is already compensated for breaks. While the FLSA requires that employers allow this accommodation for up to a year after the child’s birth, the new NJLAD amendment does not include any time restriction.

These requirements are effective immediately, unless the employer can demonstrate that providing the accommodation would pose an undue hardship on its operations. Factors to consider when deciding whether providing the accommodation would cause an undue hardship include: the number of employees, the number and type of facilities, the size of the budget, the nature and cost of the accommodation needed, and the extent to which the accommodation would involve waiver of an essential requirement of a job.

For more information about how these new requirements affect your company, please contact Dina M. Mastellone, Esq., Chair of the firm’s Human Resource Training & Audit Programs Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

Regulations Require Paid Sick Leave for Federal Contractors

On September 29, 2016, the Department of Labor (DOL) issued a final rule requiring federal contractors to provide employees with at least seven days of paid sick leave each year. This requirement applies to all new contracts.

What contracts must comply with the paid sick leave requirement?  Four types of contracts fall within the new sick leave requirement.  They are: 1) procurement contracts for construction covered by the Davis-Bacon Act; 2) service contracts covered by the Service Contract Act; 3) concession contracts; and 4) contracts in connection with Federal property or lands related to services for Federal employees and the general public.

What is a new contract?  The rule applies to new contracts, which is defined as a contract awarded or resulting from solicitations on or after January 1, 2017.  A contract prior to January 1, 2017 will also be considered a new contract if: 1) the contract is renewed; 2) the contract is extended, unless the extension arises from a term for a short term extension in the original contract; or 3) the contract is amended as a result of a modification outside the scope of the original contract.

How much paid sick leave must a federal contractor provide?  Employees working on covered, new contracts accrue one hour of paid sick leave for every thirty hours worked. Employers may also limit paid sick leave to 56 hours per year.  For administrative ease, an employer may “front-load” or provide the 56 hours at the beginning of the accrual year.  Special rules apply for carrying-over any unused paid sick leave to the following year.  The regulations also allow employers to implement a policy allowing forfeiture of any accrued, unused paid sick leave upon separation from employment.  However, if an employee is rehired within 12 months, the employer must reinstate accrued, unused paid sick leave.

What uses of paid sick leave are permitted?  The regulations provide that an employee may use paid sick leave for the following reasons:

  1. for the employee’s own physical or mental injury, injury, or condition
  2. for the employee to obtain diagnosis, care, or preventative care
  3. for the employee to care for a child, parent, spouse, domestic partner, or person in a family relationship for reasons relating to that person’s medical condition
  4. for reasons related to domestic violence, stalking, or sexual assault

For more information on the Final Rule and implementing best practices with these regulations, please contact Brigette N. Eagan, Esq., Counsel in the firm’s Human Resources Practice Group at beagan@nullgenovaburns.com or 973-533-0777.

The New Jersey Department of Labor Issues Final Ban-the-Box Regulations

On December 7, 2015, the New Jersey Department of Labor and Workforce Development (the “NJDOL”) issued regulations clarifying the requirements of New Jersey’s Opportunity to Compete Act (the “Ban the Box Law”), which take effect immediately.  The Ban the Box law generally prohibits New Jersey employers from inquiring about a job applicant’s criminal history during the “initial interview process.”  The regulations answer three important questions: (1) what is the “initial interview process”? 2) can a New Jersey employer use one standard job application when hiring employees in those states that allow early criminal history inquiries? and 3) which New Jersey employers are subject to the Ban the Box Law?

The NJDOL’s recent regulations provide parameters to define the initial employment application process.  The process begins when an applicant makes inquiries about a job or when an employer makes inquiries to the applicant about a potential job.  The process ends when the employer conducts a first interview.  This first interview need not be conducted in person.  The regulations clarify that an interview is “any live direct contact by the employer with the applicant … to discuss the employment being sought to the applicant’s qualifications.”  This means that the employer may conduct the first interview in person, by phone, or by video conference.  However, under the regulations, e-mail exchanges between the applicant and employer do not constitute a first interview.  The submission of written or electronic questionnaires also does not rise to the level of a first interview.  After the employer completes this initial employment application process, the employer may proceed to make inquiries about the applicant’s criminal history.

The regulations also tackle the issue of using one standard application in various states, some of which may allow criminal history inquiries at any stage in the hiring process.  The regulations clarify that in these standard applications for multi-state use, New Jersey employers may inquire about criminal history.  However, the application must state “[t]hat an applicant for a position the physical location of which will be in whole, or substantial part, in New Jersey is instructed not to answer this question.”

Finally, the regulations provide clarification on which New Jersey employers are subject to the Ban the Box Law.  This law applies to companies with 15 or more employees over 20 calendar weeks, whether or not those 15 employees work in New Jersey.  If the employer takes employment applications in New Jersey, conducts business in this state, or employs individuals in this state, and the employer employees 15 individuals company-wide, than it is subject to the Ban the Box Law. In light of these clarifying regulations, now is the time to update employment applications, especially those used for multi-state hiring and to train supervisors and human resources personnel on the nuances of New Jersey’s Ban the Box Law.  For more information, please contact Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practices Group, at dmastellone@nullgenovaburns.com or Brigette N. Eagan, Esq., Counsel in the firm’s Human Resources Practices Group, at beagan@nullgenovaburns.com.

Employers Face Exposure Under Title VII When Contracting For Temporary Workers

On November 18, 2015, the United States Court of Appeals for the Third Circuit allowed an employee of a temporary staffing agency to proceed with employment discrimination claims against a company to which the staffing agency assigned him.  In Faush v. Tuesday Morning, Inc., Docket No.14-1452 (3rd Cir. 2015), the Court found that for purposes of Title VII of the Civil Rights Act of 1964 (“Title VII”), the worker successfully established that he was an employee of the staffing agency’s customer.

In this case, the staffing agency directly employed the worker, and assigned plaintiff to a customer for a 10 day temporary assignment.  The worker claimed that the customer discriminated against him based on his race while performing his duties.  Plaintiff asserted claims against the customer under Title VII, which prohibits employers from unlawfully discriminating against employees.  The Court found that the customer exerted enough control over the manner in which the worker performed his duties, so that it became an employer under Title VII.

In reaching this determination, the Third Circuit applied a test called the Darden test, which focuses on “the hiring party’s right to control the manner and means by which the product is accomplished.”  This “right to control” is based upon a consideration of the following factors: 1) skill required to perform the job; 2) who provides the tools; 3) location of the work; 3) duration of the relationship between the parties; 4) whether the customer may assign additional projects to the worker; 5) the extent of the worker’s discretion on when and how long to work; 6) wages/method of payment; 7) the worker’s role in hiring and paying assistants; 8) whether the work performed is a part of the customer’s regular business; 9) whether the customer is in business; 10) whether employee benefits are provided; and 11) the tax treatment of the worker.

The Customer’s Control Over Wages.  Here, the staffing agency set the worker’s rate of pay, paid wages, paid payroll and social security taxes, and maintained workers’ compensation insurance for the worker.  The staffing agency’s customer, however, also shared some responsibilities in connection with the worker’s wages.  First, the customer was obligated to notify the staffing agency if any minimum wage was owed to the worker.  Second, the customer agreed to pay overtime charges.  Third, the customer also obligated itself to pay for any changes arising from an increase in the staffing agency’s costs for wages, taxes, and insurance for this worker.  Fourth, the customer paid the staffing agency for each hour worked by the worker, at an agreed upon hourly rate.  The Third Circuit found that this method of payment indicated the existence of an employment relationship between the worker and customer.  The Court reasoned that in an independent contractor relationship, the customer would have paid a fixed rate to the staffing agency.  Instead, the customer indirectly paid the worker’s wages, plus an administrative fee to the staffing agency.

The Customer’s Control Over Hiring and Firing.  The staffing agency hired the worker and assigned him to this particular customer.  However, the customer reserved the discretion to find this worker suitable for the assignment and could also demand a replacement worker.  Therefore, the customer essentially exercised discretion over hiring and termination decisions.

The Customer’s Control Over The Worker’s Daily Activities.  The customer delegated assignments to the worker, directly supervised him, trained him, furnished equipment and materials, and verified the time he worked.   The customer also managed the temporary worker in the same manner as its employees.  Moreover, the worker performed unskilled tasks, similar to those performed by the customer’s employees.  Finally, the customer assigned the temporary worker to one of its stores, as opposed to working in a location controlled by the staffing agency.

The Customer’s Treatment Of The Worker.  The customer itself characterized the worker as a temporary employee, not an independent contractor.  In addition, the customer committed to providing the worker with a workplace free from discrimination and unfair labor practices, and also committed to complying with all employment laws.  Thus, the Third Circuit found that these protections were similar to those offered by an employer.

Based on the customer’s control over the worker’s wages, hiring and firing decisions, and daily work activities, and based upon its treatment of the worker, the Third Circuit found that the worker could proceed with his claim that he was an employee of the customer under Title VII.

Employer’s Take-Away.  Hiring a temporary worker exposes employers to potential liability under the employment discrimination and wage and hour laws.  Carefully review agreements with staffing agencies to ensure that the worker is treated as an independent contractor and not an employee.  Employers also need to review their protocols for all contact and assignments with temporary workers to ensure that they are not treated in a manner similar to that of employees.

For more information regarding this decision and to learn if your company’s treatment of temporary workers exposes you to liability, please contact Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practices Group, at dmastellone@nullgenovaburns.com or Brigette N. Eagan, Esq., Counsel in the firm’s Human Resources Practices Group, at beagan@nullgenovaburns.com.

Update On New York City’s Fair Chance Act And Notice Requirements For Criminal Background Checks

On July 2, 2015, we wrote about New York City’s newest law, the Fair Chance Act (“FCA”), and its prohibition on employers from conducting criminal background checks before extending conditional offers of employment.  On November 5, 2015, the New York City Commission on Human Rights (“Commission”) issued Enforcement Guidance on the FCA.  This Guidance clarifies the process that employers must follow when inquiring into an applicant’s criminal history.

Under the Guidance, after extending a conditional offer of employment, the employer may inquire if the applicant has a criminal conviction or a pending criminal case; run a criminal background check (after making proper disclosures and notices); and ask about the events surrounding any conviction.  While the Guidance permits these types of inquiries, it expressly prohibits an employer from withdrawing an offer of employment based solely on the existence of a criminal conviction.  Rather, the FCA requires an employer to undertake an analysis of specific factors, called the Article 23-A factors, and then follow the Fair Chance Process.

Article 23-A Analysis.  The employer may withdraw an offer of employment based on criminal history under one of two theories.  First, the employer may show that a direct relationship exists between the criminal conviction and the job at issue, which precludes employment.  The second theory is that employing the applicant “would involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public.”  To satisfy either theory, the employer must analyze the following Article 23-A factors:  1) NY public policy of encouraging employment of people with criminal histories; 2) the job duties at issue; 3) the relevancy of the conviction on the fitness for the new position; 4) the time elapsed since the events leading to the conviction; 5) the age of the applicant at the time of the underlying events; 6) information from the applicant in connection with good conduct/rehabilitation; 7) the employer’s legitimate interest in protecting property and the public; and 8) any certificate of good conduct.

If an employer seeks to rescind an offer of employment as a result of the Article 23-A analysis, it must then satisfy the Fair Chance Process.  This process entails providing the applicant with a written copy of any inquiry it made into the applicant’s criminal history, along with the date and time that it accessed the information and the results of that inquiry, and its written analysis (the Fair Chance Notice) of the Article 23-A factors.   For convenience, the Commission has prepared a Fair Chance Notice for employers, which can be accessed at:   http://www.nyc.gov/html/cchr/downloads/pdf/FairChance_Form23-A_distributed.pdfcan.

After proving this information, the employer must give the applicant 3 business days to respond and provide additional information.  After receiving any additional information from the applicant, the employer must consider it.  If the employer’s analysis remains unchanged, the employer must notify the applicant of that decision.

Employer Take-aways.  We anticipate that the Commission will aggressively enforce this new law.  Employers are cautioned to review their hiring materials and processes for compliance.  Ensure that no pre-offer documents contain any reference to criminal background checks.  Further, Human Resources staff and all individuals involved in the interviewing process should be trained on the Guidance.

For more information regarding the FCA and best hiring practices, please contact Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practices Group at dmastellone@nullgenovaburns.com or Brigette N. Eagan, Esq., Counsel, in the firm’s Human Resources Practices Group at beagan@nullgenovaburns.com.