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

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