City of Milwaukee has new Sick Leave Law

CLIENT UPDATE
Paid Sick Leave to be Required in the City of Milwaukee

November 6, 2008

 

The vote is in:  electors in the City of Milwaukee overwhelmingly approved a referendum which requires employers to provide a paid sick leave benefit to their employees in the City of Milwaukee.  Employers must implement the municipal ordinance within 90 days of its effective date, which will occur on or before November 14, 2008.

 

The ordinance itself is ambiguous and leaves many wondering what exactly their obligations are as it relates to providing paid sick leave.  Legal challenge to this ordinance has already been initiated.  The Metropolitan Milwaukee Association of Commerce filed a Notice of Claim with the City of Milwaukee on November 5, 2008.  This Notice of Claim is the first step in litigation to prevent implementation of the ordinance. 

 

The ordinance provides that the City of Milwaukee Equal Rights Commission has the power to “adopt rules” regarding the paid sick leave ordinance.  This rule-making authority may be an opportunity for the Equal Rights Commission to clarify some of the ambiguous provisions within the ordinance itself, but whether the Equal Rights Commission will do so in a timely manner remains to be seen as of this date.  Even if the Equal Rights Commission does so, its rules will only be an attempt at clarifying the ordinance.

 

While the future of the ordinance is uncertain, employers must prepare themselves for implementation of the new ordinance.  The following is a summary of the ordinance:

 

To Whom Does the Ordinance Apply To?

The ordinance applies to any private employer with employees within the geographic boundaries of the City of Milwaukee.  Employees include all full-time, part-time and temporary employees.  Based on the current language of the ordinance, the requirements of the law arguably extend to employers physically located outside the City of Milwaukee, but who have employees working within the boundary of the City of Milwaukee. 

 

Employers, regardless of their size, will be subject to the ordinance; however, “Small Business” employers with fewer than 10 employees will be subject to less rigorous sick leave requirements.

 

How Much Paid Sick Leave Is Required?

The ordinance requires that employers provide one hour of paid sick leave for every 30 hours worked by an employee.  Under the ordinance, employers are only required to provide 72 hours of sick leave per year.  As mentioned above, Small Businesses are subject to reduced requirements and are only required to provide a minimum of 40 hours of paid sick leave per year.


 

The paid sick leave accrues in hourly increments, and the language of the ordinance is unclear as to whether this means that employers will be forced to grant sick leave in hourly increments.  Employees begin accruing paid sick leave at the commencement of employment.  An employee is not entitled to use paid sick leave until after the 90th calendar day of employment.  There is no requirement that paid sick leave be provided in advance of an employee accruing that paid sick leave.

 

Are Employees Entitled to Carryover Paid Sick Leave From Year to Year?

The ordinance requires that employers allow employees to carry over paid sick leave from year to year; however, an employer may restrict the use of that sick leave in any given calendar year to 40 or 72 hours, depending on whether the employer is a Small Business under the ordinance.  Therefore, an employee is restricted from using paid sick time beyond the allotted 40 or 72 hours each year. 

 

Employers are not required to pay out accrued but unused sick leave at termination of employment.

 

What Can Paid Sick Leave Be Used For?

Employees may use paid sick leave for a number of reasons, such as:

 

1.      An employee’s (i) mental or physical illness, injury or health condition or (ii) need for medical diagnosis, care or treatment for such illness, injury or condition; or (iii) need for preventative medical care;

 

2.      Care of a family member with a (i) mental or physical illness, injury or health condition or (ii) need for medical diagnosis, care or treatment for such illness, injury or condition; or (iii) need for preventative medical care; or

 

3.      An absence necessary due to domestic abuse, sexual assault or stalking, provided the leave is for one of a number of limited reasons related to the domestic abuse, sexual assault or stalking.

 

Note that a family member, for purposes of the ordinance, is defined to include: children, parents, spouses or domestic partners, grandparents, grandchildren, siblings, spouses of siblings, and other individuals “related by blood or affinity whose close association with the employee is the equivalent of a family relationship.”

 

Paid sick leave will inevitably overlap with an employer’s administration of federal and Wisconsin family and medical leave.  Employers will need to carefully review the various requirements of leave under the new ordinance and applicable family and medical leave laws to determine if and when leave can be designated as sick leave and family and medical leave.

 

Are There Retaliation Risks?

The ordinance has a standard anti-retaliation provision that provides that employers cannot retaliate against employees for taking paid sick leave in accord with the ordinance, filing a complaint or informing any person about alleged violations of the ordinance, and telling other people about their rights under the paid sick leave ordinance.

 

The ordinance also provides that an employer is prohibited from penalizing an employee for the use of sick leave “by reducing any benefits of employment otherwise due the employee.”  This means that employers cannot use a paid sick leave absence as a negative factor in any benefit determination.  Therefore, bonuses or awards that consider attendance as a factor should be reviewed and amended as appropriate.

 

In addition, the ordinance specifically provides that employers may not treat an absence taken for paid sick leave as an absence that may lead to discipline, discharge, demotion, suspension or other adverse action.  Accordingly, “no fault” attendance policies must be reviewed and amended as well. 

 

Are There Other Requirements Under the Ordinance?

Employers are required to give notice to employees of their right to paid sick leave, the amount of paid sick leave to which they are entitled, and that retaliation against employees for requesting or using paid sick leave is prohibited.  This notice can be done through individual notices to employees or through a general posting. 

 

In addition, employers are required to retain records documenting hours worked by employees and paid sick leave taken for a period of five years.

 

What If My Current Leave Policy Is More Generous Than The Ordinance?

The ordinance reiterates a number of times that the paid sick leave benefit in the ordinance is merely a minimum requirement and that nothing in the ordinance should be interpreted to discourage or prohibit an employer from adopting more generous paid leave policies.  According to the ordinance, a paid time-off policy that meets the minimum requirements of the ordinance is sufficient to meet the mandate of the ordinance.  However, the accrual method, the reasons for which leave can be taken, and the carryover provision that is required by the ordinance must be accounted for in an employer’s current leave policy. 

 

Next Step for Companies?

The company should first determine whether the ordinance applies to its operations and employees in the City of Milwaukee.  The next step an individual company should take in response to the paid sick leave ordinance is dependent on many factors including the terms of the company’s existing leave policies.

For assistance with the interpretation of and compliance with the ordinance, contact:

John J. Kalter (jkalter@gklaw.com, or 262-951-7153), Christine Liu McLaughlin (cmclaughlin@gklaw.com, or 414-287-9232), Margaret R. Kurlinski (mkurlinski@gklaw.com,

or 414-287-9539), or Tom O’Day (today@gklaw.com, or 414-287-9523,) of the HR and Employment Law Team.

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