Category Archives: paid sick leave benefits

The Impact of Local Minimum Wage and Paid Sick Leave Ordinances on the Transportation Industry

Contributed by Michael Wong, January 5, 2018

Over the past few years, cities, counties and local municipalities have been enacting laws and ordinances increasing the minimum wage and requiring paid sick leave for employees. While there have been growing pains with how these apply to normal hourly non-exempt employees and tipped servers, do these apply to motor carriers and employees who are truck drivers?  This can be the most frustrating legal response of all, “it depends.”

In most cases, minimum wage laws enacted by states follow the Fair Labor Standard Act (“FLSA”) and provide exemptions for motor carriers.  Indeed, under Section 12(b)(1) of the FLSA, employees whose duties, wholly or in part, affect the safety of operation of a motor vehicle and are involved in interstate commerce are exempt from being paid overtime. Whether a municipality’s minimum wage ordinance applies, depends on the language and rules of the ordinance. For example, the rules of the Cook County, Illinois minimum wage specifically state that a regulated motor carrier subject to subsection 3(d)(7) of the Illinois Minimum Wage Law is not a “Covered Employer” that would be required to pay covered employees the Chicago or Cook County minimum wage. Similarly, the rules of the City of Chicago minimum wage states that individuals employed for a motor carrier who are subject to the Department of Transportation regulation are not subject to the Chicago minimum wage.

However, paid sick leave laws and ordinances are different.  Neither the Cook County, Illinois earned sick leave ordinance or City of Chicago earned sick leave ordinance have the same exclusion for motor carriers or truck drivers.  While neither expressly states that motor carriers are required to provide paid sick leave to employees who are truck drivers, they also do not state that motor carriers or truck drivers are exempt.  Due to the plain language exempting motor carriers and truck drivers from the minimum wage ordinances, there is a very strong argument that motor carriers are required to provide their employees who are truck drivers with paid sick leave.

Indeed, this interpretation is not unusual within the growing trend of states, cities and local municipalities expanding employee rights – including those of truck drivers. Currently there are 8 states and 30 cities and municipalities that have paid sick leave laws which include:  Illinois (local), Washington (state and local), California (state and local), Arizona (state and local), Oregon (state and local), Minnesota (local), Vermont (state), Massachusetts (state and local), Pennsylvania (local), New Jersey (local), New York (local), Connecticut (state) and Washington, D.C. (local).

Bottom line, the different paid sick leave laws do not address or expressly exempt motor carriers or truck drivers from being subject to the law or ordinance. By not addressing or expressly exempting motor carriers and their employees, these laws are creating significant exposure for motor carriers that fail to make changes by providing employees who are truck drivers with the ability to earn paid sick leave or considering how those employees are being compensated. Certainly, with the patchwork of laws and nuances in each jurisdiction, it can be extremely frustrating and difficult to try and implement a globally compliant policy.  Thus, special attention must be taken when crafting such policies and review by experienced counsel should be part of the process.  Moreover, motor carriers utilizing truck drivers who are independent contractors or owner/operators should take particular pause to consider the increased liability from misclassification claims and the potential damages under the paid sick leave laws, in addition to any applicable minimum wage law or ordinance.

Paid Sick Leave: Cook County FAQs and Final Rules for Chicago

Contributed by Sara Zorich and Steven Jados, July 11, 2017

sick leave

Man sick in bed thinking about the work piling up on his desk

As part of what is certain to be an evolving area of the law, the Staff of the Cook County Commission on Human Rights has issued a set of Frequently Asked Questions (FAQs) related to the new Cook County Earned Sick Leave Ordinance (effective 7/1/17).  These FAQs (which may be updated from time to time), as well as the Cook County Earned Sick Leave Rules (“Rules”), are available for download from the Cook County Website.

In reviewing the Cook County FAQs, it is important to note their opening disclaimer, which essentially states that the FAQs are not legal advice, do not have the force of law, and do not supersede the text of the Cook County Earned Sick Leave Ordinance or its Rules. As such, discrepancies between the Rules and the FAQs should generally be resolved in favor of the Rules—and discrepancies between the text of the Ordinance, the Rules, and the FAQs should, of course, be resolved in favor of the Ordinance.

Additionally, per the FAQs, Cook County has said it will not enforce its ordinance in the City of Chicago against an employer that has complied with the Chicago Ordinance—but again, the FAQs do not carry the force of law, and will not necessarily prevent a plaintiff’s attorney from seeking to enforce the Cook County Ordinance in situations where both ordinances might apply, and an alleged failure to comply with the Cook County Ordinance has occurred since there are separate remedies under each ordinance.

In addition to the Rules implemented for the Cook County Ordinance, final rules under the Chicago Paid Sick Leave Ordinance are now available.

Because of the confusing and sometimes contradictory nature of these two ordinances, their rules, and the FAQs, we recommend consulting with experienced labor and employment counsel to work through any questions and complications that may arise in implementing workplace policies under these paid sick leave ordinances.

Cook County Final Earned Sick Leave Rules

Contributed by Noah A. Frank and Sara Zorich, June 8, 2017

sick leave 2

Stamp with the words sick leave next to a thermometer and medicine

With the Cook County Earned Sick Leave Ordinance’s July 1, 2017 effective date around the corner, the Cook County Commission on Human Relations (“CCCHR”) approved its administrative rules on May 25, 2017.

While we previously discussed the Ordinance, one of the most significant aspects of the rules is the new requirement that employers provide covered employees with a notice of their rights under the ordinance at least once per calendar year.

The CCCHR also published a model poster, which must be posted in each place of business where any covered employee works within the geographic boundaries of Cook County.

While the CCCHR has not yet published its rules on the city’s similar Ordinance, we expect the CCCHR’s rules to be instructive and may even be adopted in whole by the Chicago Commission.

Issues to Consider:

While the Ordinance is not yet in effect, the CCCHR already has posted on its website instructions to file a complaint, a complaint intake worksheet, and complaint form!

As such, employers that have not already tackled the Earned Sick Leave Ordinance should implement written policies describing accrual/fronting of leave, carryover, and interaction with other types of leave (e.g., FMLA, PTO / vacation), notice, and business locations subject to the Ordinance. Supervisors should be trained on what notice they may (and may not) require from employees, and identifying trends for abuse of leave.

Employers should also carefully consider whether their timekeeping systems and methods are equipped to appropriately and accurately account for time worked, and the total benefits that have accrued.

Federal Contractors: Paid Sick Leave Is Now A Reality

Contributed by Heather Bailey, October 21, 2016

On September 7, 2015, President Obama signed Executive Order 13706 requiring federal contractors to provide paid sick leave to their employees – up to 7 days annually. The leave is related to an employee’s own illness or injury, including, domestic violence, sexual assault and stalking absences, and for family care for same. The Department of Labor published its Final Rule just over a year later on September 30, 2016.

pay-overtimeHere are the key components:

  • The Final Rule applies to any new federal contracts solicited on or after January 1, 2017, replacement contracts (for those that are expiring) that are solicited on or after January 1, 2017, and contracts awarded outside of any solicitations on or after January 1, 2017.
  • The Final Rule covers procurement contracts for construction under the Davis-Bacon Act (contracts subject only to DB Related Acts — for example where a federal agency provides financial assistance or insurance but does not directly procure construction services — are excluded); service contracts covered by McNamara-O’Hara Service Contract Act; concessions contracts; and federal property or lands contracts, including contracts related to offering services to federal employees or the general public.
  • Good news for banks and financial institutions: unless you are otherwise covered by the above contracts, this Final Rule does not apply to you since “money” alone is not considered federal property.
  • Accrual = 1 hour of paid sick leave for every 30 hours the employee works on or related to a covered contract up to a maximum of 56 hours each year.
  • Employers who do not want to track accrual hours may give employees a bank of at least 56 hours of sick leave to use throughout the accrual year.
  • Employees must be notified in writing at the end of each pay period or month (whichever is shorter) of the amount of paid sick leave available to them.
  • Any accrued but unused leave must carry over year to year, but the Final Rule imposes no obligation to pay out the sick leave bank upon termination of employment (although state law may, so be sure to check state laws on this topic of payout of earned vacation, sick, PTO, etc. to ensure compliance).
  • Employees can take the leave in increments as low as 1 hour.
  • All rejections of sick leave requests must be in writing and state the reason for the denial. That reason cannot be no replacement worker was found or the operational needs of the company.
  • Certification can only be required for absences of 3 or more days and with prior notice if the employee needs to certify his/her return to work.
  • Here is your new poster.

The good news is the Family Medical Leave Act leave runs concurrently with this new paid sick leave and you can use your existing paid time off policies so long as the rights and benefits meet or exceed the requirements of the Final Rule.

The DOL’s Final Rule can be found here and Fact Sheet, here.

With the new and ever changing paid sick leave laws in various states, cities and locales, it is a good idea to reconcile them all (including CBAs) with these new requirements to ensure compliance so you don’t get hit with a penalty to pay damages or worse, debarment.

Paid Sick Leave Requirements Expand to Cook County Suburbs

Contributed by Beverly Alfon, October 11, 2016

Last week, the Cook County Board passed a paid sick leave ordinance that requires most employers in Cook County to provide paid sick leave for their employees. It will take effect on July 1, 2017 and basically mirrors the requirements of a City of Chicago paid sick leave ordinance that passed earlier this year.

The county ordinance requires a covered employer to provide to eligible employees up to 40 hours (5 work days) of paid sick leave in a 12-month period. The 12-month period begins as soon as the covered employee begins employment or July 1, 2017, whichever is later. 

sick-leaveCoverage.  A covered employer is any individual, group of persons or entity that employs at least one “covered employee” and has its principal place of business within Cook County.  A covered employee is any individual who performs at least 2 hours of work for your company within Cook County, during any two-week period, including time that you pay the employee while s/he is traveling within Cook County for business purposes (e.g., deliveries, sales calls, service calls, etc.).

Eligibility. The employee must work at least 80 hours for your company within any 120-day period.

Accrual. Accrual of paid sick leave for an eligible employee is capped at 40 hours of paid sick leave in each 12-month period, which is calculated from the beginning of either the 1st calendar day after the start of the employee’s employment or July 1, 2017, whichever is later. Employees will accrue 1 hour of paid sick leave for every 40 hours worked. For employees who are exempt from overtime requirements, the ordinance assumes a 40-hour work week; however, if the exempt employee works less, the accrual will be based on the employee’s normal week.

Usage.  The earned sick leave time may be used for recovering from illness or injury, medical treatment, diagnosis or preventative care for the employee or the employee’s child, parent, spouse, domestic partner, sibling, grandparent, grandchild, including step and foster relationships, and “anyone whose close association with the employee is the equivalent of a family relationship.” It may also be used for matters related to domestic violence or sexual assault; and, when an employee must care for a child due to a public health emergency closure related to the child’s school or care facility.

An employee must be able to start using earned sick leave by at least the 180th day following his/her first day of employment. Usage of earned sick leave is also generally capped at 40 hours for each 12-month period of employment (calculated from the date the employee began to accrue the sick leave), unless an employer sets a higher limit.  All eligible employees can carry over up to 20 hours of their unused paid sick leave to the next 12-month period. If an employee is also eligible for leave under the Family and Medical Leave Act, the employee can carry over the standard 20 hours, plus up to 40 hours of his/her unused sick leave to use exclusively for FMLA purposes. This means that an employer has a potential burden of providing 60 paid sick leave hours in a 12-month period!

A minimum increment requirement can be set by the employer, but it cannot exceed 4 hours per day. If an employee’s sick leave absence is 3 or more consecutive work days, an employer may also require employees to provide certification or documentation to support the reason for the leave.

Unlike earned vacation, there is no payout requirement for earned but unused paid sick leave time upon separation from employment.

Posting and Notice Requirements.  Employers will be required to issue written notice to new employees and display a poster notifying employees of their rights under the ordinance. The notice and poster will be created and made available by the Cook County Commission on Human Rights.

Employee Recourse.  The ordinance contains non-retaliation/non-discrimination language with respect to any employee’s good faith exercise of rights under the ordinance. It also prohibits an employer from using an attendance policy to discipline, discharge, or take any other adverse action against an employee for any bona fide use of the paid sick leave time. For any alleged violations of the ordinance, employees may pursue civil court actions against employers to recover the value of up to three times the amount of unpaid sick time denied or lost, plus interest and attorneys’ fees and costsClaims are subject to a 3-year statute of limitations.

Exceptions.  The ordinance does not affect existing collective bargaining agreements.  Once the collective bargaining agreements expire, however, the ordinance will apply to a covered employer unless the union and employer clearly and explicitly waive the ordinance requirements. With or without a waiver, however, the ordinance will not apply to any employee who works in the construction industry and is covered by a collective bargaining agreement.

Existing Paid Time Off (PTO) Policy. The ordinance provides that an employer has an existing PTO policy that grants covered employees paid leave “in an amount and manner” that meets the ordinance’s requirements, the employer does not need to provide additional paid leave. However, a broad reading of this language suggests that even if you have a PTO policy that provides for at least 5 days’ leave, you must ensure that how the leave can be used and carry over minimum requirements are up to par.

If an employer’s PTO policy provides a full bank of 40 hours immediately upon eligibility (versus an accrual system), then the employer must provide each covered employee at least 40 hours of PTO within one calendar year of his/her date of eligibility.  In other words, regardless of the accrual rules, the covered employee must get to use at least 40 hours of paid sick leave within each 12-month period.

Next steps:  Determine if you are a “covered employer” and which of your employees are covered under this ordinance. If you are a covered employer, then:

  • Review your PTO, sick leave and attendance policies for compliance and need for modification.
  • Train your human resources personnel and supervisors regarding the requirements and prohibitions under the ordinance, especially if they are involved in monitoring attendance and issuing related discipline.

For those employers who are NOT covered by the Chicago or Cook County ordinances, be mindful of the Illinois Sick Leave Act, effective January 1, 2017, which requires certain flexibility with respect to employee use of sick time.

City of Chicago Approves Paid Sick Time and Reminder… Chicago Minimum Wage Increases to $10.50 on July 1, 2016

Contributed by Sara Zorich and Mike Wong, June 28, 2016

City of Chicago Approves Paid Sick Time

On June 21, 2016, we posted a blog on the City of Chicago’s proposed ordinance mandating paid sick leave, including details about who it covers and how it could impact business owners.

On Wednesday, June 22nd, the full City council passed the ordinance. Effective July 1, 2017, part time and full time employees in Chicago will accrue 1 hour of sick leave for every 40 hours they work – with a cap of 5 days paid leave per 12 month period.

Employers can utilize their existing paid time off policies if they are more generous than the Chicago ordinance; however, the ordinance REQUIRES mandatory carry-over of accrued but unused sick time, which is something many paid time off policies do not allow. Chicago employers should begin reviewing their current sick time or paid time off policies to ensure compliance with the ordinance.  If Chicago employers do not have any policies in place, they will want to do so by July 2017.

Reminder… Chicago Minimum Wage Increases to $10.50 on July 1, 2016

Minimum WageLast year, the Chicago Minimum Wage Ordinance went into effect. This ordinance requires a mandatory yearly increase to the Chicago minimum wage. As of July 1, 2016, the Chicago Minimum Wage increases to $10.50/hr and the minimum wage for tipped employees increases to $5.95/hr with an applicable tip credit of $4.55 (i.e., $10.50 minus $5.95).

Unless an employee is exempt from overtime under the Illinois Minimum Wage Law (IMWL), employers subject to the Chicago Ordinance must pay employees overtime of 1.5 times the City’s minimum wage. This means that on July 1st, 2016, the Chicago’s minimum overtime wage will be $15.75 per hour (i.e. $10.50 times 1.5) and the overtime rate for tipped employees is $11.20 (i.e. $15.75 – $4.55).

Employers should check their record keeping and payroll systems to ensure this change is implemented as of July 1, 2016.

City of Chicago Is Teeing Up For Mandated Paid Sick Leave

Contributed by Heather Bailey, June 21, 2016

Paid time offOn June 17, 2016, the City of Chicago took one step closer into joining the ranks of requiring employers to give paid sick leave to their employees when the City Council’s Committee on Workforce Development and Audit unanimously voted on the Ordinance to do just that. If passed, Chicago will join 26 other cities (such as New York City, NY, Newark, NJ, and Philadelphia, PA), along with Washington, DC and five states (California, Connecticut, Massachusetts, Oregon and Vermont), who have also passed similar mandated paid sick leave for workers.

The Ordinance as currently proposed will be applicable to an employer of any size – this means all companies with employees in Chicago will be required to comply. Any employee who works at least 80 hours in a four month time span will qualify. Thus, this new Ordinance applies to part-time employees as well. Employees will accrue 1 hour of sick leave for every 40 hours they work – with a cap of 5 days paid leave per 12 month period.

The proposed Ordinance offers the following struggles for business owners:

  • Up to 20 hours (half of the allotted time can be carried over to the next year, with 40 hours of carry over to be used towards FMLA leave).
  • Employers could not require that employees must find their replacement to cover their shift while they use the paid sick leave.
  • Employees could use the time off for more than just being sick (i.e., closure of a school or business due to a public health emergency, domestic violence).
  • Companies without Human Resources Departments will have a harder time administering the leave and curbing use-abuse by employees.

Some of the Pros for business owners:

  • Any earned but unused sick leave would not need to be paid to employees leaving the company for any reason.
  • Employers could require a seven day notice for any foreseen absences such as a pre-planned doctor’s appointment.
  • Temporary and seasonal workers will be excluded since they won’t be able to meet the 6-month waiting period to use the time once it starts accruing.
  • Employers would get one year to implement due to the effective date of July 1, 2017, if passed.
  • Current collective bargaining agreements do not need to be modified to include paid sick leave or amend existing provisions, as well as, negotiations for future contracts could waive the paid sick leave requirement.
  • If an employee is absent 3 consecutive days, the employer could require a doctor’s note or other legitimate proof for the time off.

Stay tuned as the full City Council votes on the mandatory paid sick leave Ordinance tomorrow, Wednesday, June 22nd.