New Jersey Requires Paid Sick Leave

Posted on May 4, 2018

New Jersey has enacted legislation (Assembly Bill 1827) that will require employers to provide paid sick leave to employees who work in the state. Assembly Bill 1827 is effective October 29, 2018.

Covered Employers:

The law generally covers all employers with employees in the state. However, the law doesn't cover a public employer that is required to provide sick leave with full pay pursuant to any other New Jersey law, rule, or regulation.

Covered Employees:

The law covers all employees except an employee performing service in the construction industry that is under contract pursuant to a collective bargaining agreement, a per diem health care employee (as defined by the law), or a public employee who is provided with sick leave with full pay pursuant to any other New Jersey law, rule, or regulation.

Accrual:

Employers must provide employees with at least one hour of paid sick leave for every 30 hours worked. However, employers may provide employees with their full allotment of paid sick leave on the first day of the benefit year, a practice known as frontloading. Employers may cap accrual at 40 hours per benefit year.

Unless the employee has accrued paid sick leave prior to enactment of the law, employees begin to accrue paid sick leave no later than October 29, 2018 or on their date of hire, whichever is later.

Where a temporary help service firm places an employee with client firms, the employee should accrue sick leave based on the total time worked on assignment with the temporary help service firm, not separately for each client firm to which the employee is assigned.

Carryover:

Employers must generally carryover employees' unused sick leave to the following year. Employers may cap carryover at 40 hours.

An employer using the accrual method for providing sick leave may offer to pay employees for their unused sick leave in the final month of the benefit year. If the employer chooses to make this offer and the employee accepts the offer, the employee may then choose, within 10 calendars days of the offer, whether to receive a payout for either all or half of their unused leave. If the employee chooses a full payout, no carryover is required. However, if the employee chooses payout of half of the unused leave, the employee is entitled to carryover the leftover leave. For example, if the employee has 32 hours of accrued, unused sick leave at the end of the year, the employee would receive a payout for 16 hours and carryover the other 16 hours.

If an employer chooses to frontload sick leave at the beginning of the year, the employer must either payout the full amount of unused sick leave in the final month of the benefit year (assuming the employer chooses to frontload sick leave the following benefit year) or carryover any unused sick leave to the next benefit year.

Use:

Employees are entitled to use up to 40 hours of sick leave per benefit year. Unless the employee has accrued paid sick time prior to October 29, 2018, employees may begin to use their accrued sick time 120 days from their date of hire, unless the employer agrees to an earlier date. Once employees have worked for the employer for 120 days, employees may use leave as it is accrued.

Employees may use accrued sick leave for the following purposes:

  • The diagnosis, care, or treatment of, or recovery from, an employee's or their family member's mental or physical illness, injury, or other adverse health condition, or for preventive medical care;
  • If the employee or a family member is a victim of domestic or sexual violence and the leave is to obtain medical attention; services from a victim services organization; psychological or other counseling; relocation; legal services; or to participate in a civil or criminal legal proceeding;
  • Closure of the employee's workplace, or the school or place of care of the employee's child, by order of a public official due to an epidemic or other public health emergency, or because of a public health authority's determination that the employee's or their family member's presence in the community would jeopardize the health of others; or
  • A school-related conference, meeting, function or other event requested or required by a school administrator, teacher, or other professional staff member responsible for the child's education, or to attend a meeting regarding care provided to the child in connection with the child's health conditions or disability.

Under the law, a family member includes:

  • A child, grandchild, sibling, spouse, domestic partner, civil union partner, parent, or grandparent;
  • A spouse, domestic partner, or civil union partner's parent or grandparent;
  • A sibling of a spouse, domestic partner, or civil union partner; or
  • Any other individual related by blood to the employee or whose close association with the employee is the equivalent of a family relationship.

For a complete definition of family member, see the full text of the law.

Employee Notice and Documentation:

If the need for leave is foreseeable, employers may require up to seven days' advance notice. Employers may also require employees to make a reasonable effort to schedule sick leave so it does not unduly disrupt employer operations. If the reason for the leave is not foreseeable, an employer may require an employee to give notice as soon as practical, if the employer has notified the employee of this requirement.

Employers may prohibit employees from using foreseeable leave on certain dates and require reasonable documentation if sick leave that is not foreseeable is used during those dates.

For sick leave of three or more consecutive days, employers may require reasonable documentation that the leave is being taken for the purpose permitted by the law. For details on reasonable documentation, see the full text of the law.

Pay During Leave:

The employer must pay sick leave at the same rate of pay with the same benefits as the employee normally earns, except that the pay rate must be no less than the minimum wage.

Benefit Year:

Employers must establish a benefit year that is a period of 12 consecutive months in which employees accrue and use sick leave under the law. Once this date is established, employers must notify the New Jersey Department of Labor and Workforce Development before changing it.

Relationship to Existing PTO Policies:

Employers can use their existing paid time off policy to satisfy the law, as long as it:

  • Allows employees to accrue leave at least at the same rate as required by the law; and
  • Permits employees to use leave for at least all the purposes covered by the law.

Pay for Unused Sick Leave at Employee Separation:

Unless an employer policy or collective bargaining agreement provides otherwise, an employee is not entitled to payment of unused sick leave upon separation from employment.

Retaliation Prohibited:

Employers are prohibited from taking adverse action against an employee for requesting or using paid sick leave in accordance with the law or the employer's policy; filing a complaint alleging the employer's violation of any provision of the law; or informing any other person of their rights under the law.

The law also prohibits employers from counting leave taken under the law as an absence that may result discipline, discharge, demotion, suspension, a loss or reduction of pay, or any other adverse action.

Local Ordinance Preemption:

Assembly Bill 1827 preempts local sick leave ordinances. Thirteen local jurisdictions in the state have sick leave requirements: Bloomfield, Elizabeth, East Orange, Irvington, Jersey City, Montclair, Morristown, Newark, New Brunswick, Passaic, Paterson, Plainfield, and Trenton. Covered employees will continue to accrue sick leave under those laws until October 29, 2018. Assembly Bill 1827 doesn't expressly address what employers should do with sick leave that employees have already accrued in these jurisdictions prior to October 29, 2018. Employers in these jurisdictions may want to consult legal counsel to discuss their options and watch for potential guidance from the state.

Recordkeeping and Notice Requirements:

Employers must retain records documenting hours worked by employees and sick leave taken for at least five years.

Employers must post a notice of employees' rights under the law in a place accessible to all employees in each of the employer's workplaces. The employer must also provide each employee with a written copy of the notice according to the following schedule:

  • For current employees, no later than 30 days after the notice is issued by the state.
  • For new hires, at the time of hire; and
  • When first requested by an employee.

Employers must furnish the notice in English, Spanish, and any other language for which the state has provided notice and which is the first language of a majority of the employer's workforce.

Compliance Recommendations:

Employers with employees in New Jersey should review their policies, forms, practices, and supervisor training to ensure compliance with Assembly Bill 1827.

Note: HR411®'s Employee Handbook Wizard now includes a Paid Sick Leave Policy for New Jersey employees. See the Alerts section, found on the Employee Handbook Wizard home page, for more information and to add this policy into your handbook.