EXECUTIVE ORDER ON MANDATORY SICK LEAVE FOR FEDERAL CONTRACTORS

In celebration of Labor Day, President Obama on September 7, 2015 announced an Executive Order requiring federal contractors to provide minimum amounts of paid sick leave to their employees.  This rule follows others, such as the $10.10 mandatory minimum wage, that make a broad statement but apply only to employers who do business with the federal government, and whose employment relationships the White House can affect directly, without having to go through Congress.

When the rule takes effect January 1, 2017, covered employers will have to provide seven (7) days or more of paid sick leave annually, including paid leave allowing for family care.   The rules are quite specific and provide, among other things, that:

1. Employees shall earn not less than 1 hour of paid sick leave for every 30 hours worked;
2. A contractor may not set a limit on the total accrual of paid sick leave per year at less than 56 hours;
3. Paid sick leave may be used by an employee for an absence resulting from physical or mental illness, injury, or medical condition; obtaining diagnostic or preventative care; caring for a child, parent, spouse, domestic partner, or any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship; or is a victim of domestic violence, sexual assault, or stalking, including seeking assistance from a victim services organization or taking related legal action;
4. Accrued paid sick leave must carry over from one year to the next;
5. An employer is not required to pay an employee for unused leave upon separation, but any balance must be reinstated for employees rehired within 12 months after a job separation; and
6. An employer may only require certification of the need for leave if it is for a period of more than 3 days.

 The Secretary of Labor will be responsible for enforcing the law, including issuing regulations and prosecuting any retaliation claims.  It remains to be seen whether the regulations will permit employers who offer paid time off (PTO) in lieu of separate sick or vacation leave to continue that practice, so long as the leave may be used in a manner consistent with the Presidential directive.

 The benefits available to federal employees under this Executive Order are somewhat more generous and the employee responsibilities more relaxed than those available under the Family and Medical Leave Act (FMLA) or any other federal law – for example, it would cover going to court to apply for a protective order against an abusive domestic partner.

 The effective date of January 1, 2017 is just weeks before the inauguration of our next President, and he or she will have the right unilaterally to rescind this Executive Order.