Seyfarth Synopsis: This Legal Update is a reminder to employers that important aspects of the New York State Paid Sick Leave Law and amended New York City Earned Safe and Sick Time Act began on January 1, 2021. Under the state law, January 1 marked the date that covered employers must permit eligible employees to begin using sick leave benefits they have accrued since the law's September 30, 2020 effective date. Although the statewide mandate is now fully in effect, employers should continue to look out for further developments at the state level, including final regulations. Under the city mandate, January 1 marked the beginning of the law's increased annual usage cap for certain sized employers. New York City employers should also take note of their city-specific compliance obligations and related recent deadlines, as well as potential forthcoming developments.
The New York State Paid Sick Leave Law ("NYPSL") went into effect on September 30, 2020. Since then, eligible employees have been entitled to accrue 1 hour of sick leave for every 30 hours worked, up to 40 or 56 hours per calendar year depending on whether their employer employs more or less than 100 employees.1 While the NYPSL law, administrative guidance, and proposed regulations remain silent on whether (a) employers can impose a cap on the amount of earned, unused paid sick leave that carries over at year-end, and (b) frontloading the full amount of required paid sick leave at the start of each year eliminates year-end carryover obligations, employers can cap the amount of available paid sick leave an employee can use in a year to 40 or 56 hours, depending on employer size.
Under the NYPSL law, employers did not need allow employees to use paid sick leave benefits that were earned in 2020 (i.e., between September 30 and December 31). However, on January 1, 2021, employees' ability to use these benefits began (note that because state and city sick leave law benefits run concurrently where the reasons for use overlap, the maximum leave time available generally is not increased beyond the applicable 40 or 56 hours in 2021). Governor Cuomo recently reminded covered employers and eligible employees of this fact. Employers should keep in mind that also as of January 1, both existing employees and new hires can use their sick leave benefits as they are earned without any corresponding probationary usage waiting period.
Our prior Legal Updates on the NYPSL law and corresponding October 2020 administrative guidance discuss a variety of substantive topics, including, but not limited to: (1) Employer and Employee Coverage; (2) Accrual Start Date, Rate, and Cap; (3) Frontloading; (4) Usage Start Date/Waiting Period; (5) Covered Reasons for Use and Family Members; (6) Increments of Use; (7) Year-End Carryover; (8) Annual Usage Cap; (9) Acceptable Benefit Years; (10) Confidentiality; (11) Non-Retaliation; (12) Rate of Pay; (13) Available Balance Notice; (14) Recordkeeping; (15) Use of Existing Policies For Compliance; (16) Collective Bargaining Agreement Exemption Requirements; (17) Payout Upon Separation; (18) Employee Notice of PSL Use and Documentation; (19) Reinstatement Upon Re-hire; (20) Notice and Posting of Rights; (21) Recordkeeping; (22) Employer Size Determination; and (23) Written Policy Requirements.2
At the same time, and even with the December 2020 release of proposed NYPSL regulations, there are some significant unresolved details we are hoping will be addressed in the regulations ultimately adopted or otherwise. Beyond the open questions on year-end carryover limits and "use it or lose it" setups mentioned above, other gray areas include whether (a) employer size, which impacts annual benefit obligations, is determined by counting only employees working in the state or nationwide; and (b) employers must notify employees of their rights under the NYPSL law by providing individual notice of and/or posting the information.3
The New York Department of Labor (the "Department") will receive comments on its proposed regulations until approximately February 7, 2021, 60 days after the December 9, 2020 publication of notice of the same in the New York Administrative Register. The Department will then consider whether (a) to adopt the regulations as proposed or with non-substantial changes, or (b) substantial changes are required, for a minimum of 45 days. If the latter determination is made, a revised notice of proposed regulations will be submitted and subject to another comment period of 30 days. As a result, despite the NYPSL law currently being in full effect, uncertainty and potential updates will persist for some time into 2021.
Big Apple employers should keep an eye on the above NYPSL developments. They also should be weary of recent deadlines that have passed specific to the amended New York City Earned Safe and Sick Time Act ("ESSTA"), which as a reminder, also took effect on September 30, 2020. While a number of ESSTA amendments, such as an increased annual accrual cap for certain employers and removal of the Act's prior new hire usage waiting period, took effect immediately, the increased annual usage cap of 56 hours for employees of certain employers (up from 40 hours per year in prior years) began on January 1, 2021.
Despite statutory deadlines seemingly to the contrary, the New York City Department of Consumer and Workforce Protection ("NYC DCWP") appears to have extended employers' deadline to distribute the updated model notice of rights to eligible employees and post the same in the workplace, as well as for employers who could not operationalize the city-specific available balance notice requirement but had been working in good faith on implementation to ensure compliance, to January 1, 2021. The NYC DCWP still has not amended its ESSTA Rules, with the pre-September 30 amendments version still included in materials on the NYC ESSTA website. NYC employers thus should keep an eye out for regulatory updates, as well as further administrative guidance and compliance materials from the NYC DCWP, in addition to statewide developments mentioned above.4
With the paid leave landscape continuing to expand and grow in complexity, companies should reach out to their Seyfarth contact for solutions and recommendations on addressing compliance with New York State and local general PSL laws and paid leave requirements more generally.5 To stay up-to-date on Paid Sick Leave developments, click here to sign up for Seyfarth's Paid Sick Leave mailing list. Companies interested in Seyfarth's paid sick leave laws survey should reach out to firstname.lastname@example.org.
1. Employers with 0-4 employees whose net income is $1 million or less in the previous tax year are required to provide unpaid sick and safe time benefits, while paid sick and safe time benefits are required for employers of the same size whose net income in the previous tax year is greater than $1 Million. Employers with 5 or more employees are required to provide paid sick and safe time benefits regardless of net income in the previous tax year.
3. A number of NYPSL fact sheets regarding sick time, safe time, sick time for domestic, farm, restaurant and hospitality, seasonal, and union workers, and sick time for employers were also released in December 2020 and are available on the New York State Department of Labor's NYPSL website. However, the focused documents largely reiterate previous general guidance as applicable and do not address the ambiguities highlighted above.
5. In addition to keeping tabs on nationwide state and local sick leave compliance as needed, employers with employees in New York should note the following with respect to state and local sick and safe time requirements that may be applicable: (1) New York State employers may also be subject to the separate statewide COVID-19 Emergency Leave Law; (2) New York City has released administrative guidance regarding ESSTA safe/sick time benefits during COVID-19; and (3) Westchester County, NY employers may be subject to the County's separate Safe Time Leave Law.
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