New Jersey’s New Paid Sick Leave Act to Go into Effect Towards the End of This Month

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By Prema Roddam

Summary

New Jersey will begin to enforce a new paid-sick-leave law, which is mandatory for all employers in New Jersey. The new law requires employers of all sizes in New Jersey to provide up to 40 hours of paid sick leave per year to covered employees. Below, we highlight the key features of the new law that directly affect an employer in the state of New Jersey.

Discussion

The new law was signed by Governor Murphy on May 2, 2018 to go into effect on October 29, 2018. After enactment, employees will begin to accrue leave. The accrual rate is one hour per 30 worked, up to a maximum of 40 hours in one year. Employees will be eligible to use the accrued leave 120 days later. For employees hired after the effective date of the law, benefits will begin to accrue immediately, and they will be eligible to use the leave after 120 days. However, employers may agree to an earlier date.

Employers may consider these best practices prior to the law becoming effective on October 29, 2018:

  1. Review current PTO policies, call-out and discipline procedures. Close attention should be paid to the law’s specific requirements on accrual, carry over, and the definition of a family member for whom paid sick leave could be used. If a current PTO policy is in excess of the new requirements, it need not be changed;
  2. Train managers and supervisors about the law’s anti-retaliation provisions. That is, employees can no longer be required to find their replacements and may only have to provide “reasonable” notice that they intend to use paid sick leave;
  3. Develop a system to comply with the record-keeping provisions of the law and to keep track of how much paid sick leave is accrued by each employee; and,
  4. Monitor the NJDOLWD website to check for the poster that must be provided and posted informing workers of their rights under the Paid Sick Leave Law.

Employers must:

  1. Post a notice (provided by the commissioner of the NJDOLWD) in a conspicuous place.
  2. Provide a copy of the notice to all employees:
  3. Within 30 days after it is issued by the NJDOLWD;
  4. At the time of an employee’s hiring, if the employee is hired after the notice is issued; and
  5. Any time an employee requests a copy of the notice.

Employers with bilingual workforces must post and provide the notification in English, Spanish, and any other language for which the NJDOLWD has made the notification available and which the employer reasonably believes is the first language of a significant number of the employer’s workforce.

Employees may use earned sick days for:

  1. Their own health needs or that of a family member, defined in the law as a “child, grandchild, sibling, spouse, domestic partner, civil union partner, parent, or grandparent or any other individual related by blood to the employee or whose close association with the employee is the equivalent of a family relationship”;
  2. Issues resulting from an employee (or family member of employee) being a victim of domestic or sexual violence, including medical attention necessary for physical or physical or psychological injury; obtaining services from a designated domestic violence agency or other victim services organization; relocation; or legal services, including participation in any related legal proceeding;
  3. Closure of the employee’s workplace, school, or childcare due to a public health emergency;
  4. A child’s school-related conference, meeting, function, or other event.

The law permits employers to require advance notice of foreseeable absences and allows businesses to prohibit the use of “foreseeable” paid-sick-leave benefits on certain dates, as well as require documentation if unforeseeable sick leave is used on those dates. If an employee is absent for at least three consecutive days, the business may request documentation to confirm the employee used the sick-leave benefits for a purpose permitted under the act.

Only three groups of employees will not receive coverage within this law, which are:

  1. Those in the construction industry that are under contract with a collective bargaining agreement,
  2. Per diem healthcare employees, and
  3. Public employees who are provided with sick leave under another law, rule, or regulation

New Jersey’s Paid Sick Leave Law imposes the same penalties as those imposed for other wage and hour violations. These are fines of $250 for a first offense and $500 for subsequent offenses. For “willful violations,” or, when an employer is found to have intentionally disregarded the law or acted with indifference, penalties increase to between $100 and $1,000 and 10-90 days in prison. For further “willful” violations, employers can be fined between $500 and $1,000 and/or face between 10 and 100 days in prison.

Eligible employees are entitled to accrue sick leave at a rate of one hour of sick leave for every 30 hours worked in a benefit year (which may be any period of 12 consecutive months as established by the employer). An employer shall not be required to permit an employee to accrue more than 40 hours of sick leave in a given benefit year.

As an alternative to an accrual system, an employer may provide employees, in the beginning of each benefit year, with the full amount of earned sick leave that each employee would otherwise be entitled to accrue under the new law (the “front-loading method”).

An employer that currently offers its employees paid time off (which may include personal, sick, and/or vacation days) that accrues at a rate equal to or greater than that required by the new law, and that can be used for the same purposes and in the same manner as provided by the new law, may use such time to satisfy its obligations under the new law.

When sick leave is provided using an accrual system, employees may carry over up to 40 hours of earned but unused sick time into the following benefit year. Alternatively, employers may offer employees the option to receive payment of their unused sick days in the final month of the employer’s benefit year.

Employees may choose to: (i) accept payout of all earned but unused sick leave; (ii) decline the payout and carry over all unused time to the following benefit year; or (iii) accept payout for half of the earned but unused leave time and carry over the remaining earned sick leave, which shall not exceed forty hours.

When sick leave is provided using the front-loading method, the employer must either provide the employee with a payment for the full amount of unused earned sick leave in the final month of the employer’s benefit year or allow the employee to carry forward any unused sick leave to the next benefit year.

Contact Us for Questions or Concerns

If you have any questions, please contact Prema Roddam, Esq. at our New Jersey office at 732-205-8600 or prema.roddam@chugh.com.

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