The proposed regulations provide employers with preliminary guidance on the Earned Sick Time Law.

On April 27, the Massachusetts Attorney General’s Office (AG or AG’s Office) released proposed regulations regarding the new Earned Sick Time Law that voters approved last November. The regulations provide long-awaited guidance concerning how employers will need to modify their policies to comply with the law, which goes into effect on July 1.

Under the new law, Massachusetts employees are entitled to earn up to 40 hours of sick leave per calendar year. Employers with 11 or more employees must provide paid leave, while employers with 10 or fewer employees have the option to provide sick leave in the form of unpaid leave.

The AG’s Office is seeking public comment regarding the proposed regulations and has scheduled six public hearings during May and June. The AG is also accepting written comments, which must be submitted on or before June 10.

Below are some of the key provisions from the proposed regulations:

Purposes. An employee may use earned sick time for the following purposes: (1) to care for the employee’s child, spouse, parent, or parent of a spouse who is suffering from a physical or mental illness, injury, or medical condition that requires home care, professional medical diagnosis or care, or preventative medical care; (2) to care for the employee’s own physical or mental illness, injury, or medical condition that requires home care, professional medical diagnosis or care, or preventative medical care; (3) to attend the employee’s routine medical appointment or a routine medical appointment for the employee’s child, spouse, parent, or parent of a spouse; or (4) to address the psychological, physical, or legal effects of domestic violence. The regulations make clear that earned sick time can cover the time necessary to travel to and from an appointment, a pharmacy, or other location related to the purpose for which the time was taken.

Employer Size. For the purpose of determining employer size, employers must include all of their employees, not just those who work in Massachusetts. Employers must provide paid sick leave if they maintained 11 or more employees on the payroll during either (a) 16 consecutive weeks during the previous calendar years; or (b) 20 or more weeks (whether consecutive or not) during the previous calendar year.

Eligibility. An employee is eligible to accrue and use earned sick time if the employee’s “primary place of work” is in the Commonwealth of Massachusetts. The regulations clarify that it is not necessary for an employee to spend more than 50% of his or her working time in Massachusetts. The regulations provide the following example:

"Example: A painter with a single employer works 40% of her hours in Massachusetts, 30% in New Hampshire and 30% in other states. Massachusetts is her primary place of work.”

The regulations note that if an employee’s primary place of work is in Massachusetts, then all hours the employee works, regardless of the work location, must be applied toward accrual of earned sick time.

Accrual. Nonexempt employees accrue earned sick time at a rate of one hour of earned sick time for every 30 hours of work, including overtime hours. Exempt employees will be assumed to work 40 hours per week, provided that their job description or other terms and conditions of employment do not specify a lower number of hours per week, as in the case of a salaried part-time employee. In such a case, earned sick time accrues based on the specified number of hours per week.

Carryover. At the end of the calendar year, an employee may carry over up to 40 hours of unused earned sick time to the next calendar year. However, employers that provide a lump sum of 40 hours of job-protected earned sick time at the outset of employment and at the start of each subsequent calendar year (rather than tracking the accrual of earned sick time over time) are deemed to be in compliance with the carryover requirement.

Calendar Year. Employees are entitled to earn up to 40 hours of sick leave per calendar year, and employers have the liberty of defining “calendar year.” This means that employers can define “calendar year” in a manner that coincides with their business needs and existing policies. For example, a “calendar year” could be defined as a year that runs from January 1 to December 31, but may also be defined as a tax year, a fiscal year, a contract year, or each consecutive year following an employee’s first day of employment. Employers are cautioned to apply the choice of “calendar year” consistently and uniformly to all employees and must inform their employees in writing what constitutes “calendar year” on an employee’s date of hire.

The regulations clarify, however, that for the purpose of determining employer size, the term “calendar year” shall mean a year that runs from January 1 to December 31.

Payment for Earned Sick Leave. When earned sick leave is used, sick time must be paid on the same schedule as regular wages are paid. The regulations provide guidance on how to calculate payment for employees, including for employees who are paid on commission or who receive different pay rates depending on the tasks or hours worked. An employer is not permitted to delay compensation to employees for earned paid sick time until the employer receives written verification or documentation of the use of the earned sick time.

Documentation. The regulations offer much-needed guidance on the documentation aspect of the new law. For example, an employer may require written certification by a healthcare provider that the use of earned sick time was for an authorized purpose when an employee’s use of earned sick time results in an absence of more than 24 consecutive work hours. The regulations provide alternative options for employees who do not have a healthcare provider. Under these circumstances, an employee can provide a signed written statement evidencing his or her need to use the earned sick time. Employers should refrain, however, from asking employees to explain the nature of their illness or the details of, for example, domestic violence. The AG’s Office is expected to release a model documentation form that employers may use and/or incorporate into their own policies.

Implications for the Remainder of 2015. Employees shall begin to accrue earned sick time beginning on July 1. An employer is not required to provide more than 40 hours of earned paid sick time during the transition year, and any paid leave given prior to July 1 will be credited. Employers that previously provided unpaid sick leave and that have 11 or more employees must allow employees to accrue up to 40 hours of paid sick leave after July 1.

Allowable Substitutions of Paid Leave Plans. Many employers already have paid leave policies in place. The regulations clarify the types of leave plans and policies that will serve as substitutes to the earned sick leave requirements under the new law. The regulations provide that such paid time off (PTO) policies must

  • accrue at a rate of no less than one hour of PTO for every 30 hours of work;
  • be paid at an employee’s same hourly rate, as defined by the regulations;
  • be accessible on the same basis, meaning that time may be taken for the authorized uses under the statute;
  • come with the same notice requirements to employees; and
  • be afforded the same job protections.

Notice and Record Keeping Provisions. Employers must provide employees with a copy of the law and regulations and must also post a notice of the law and regulations in a conspicuous location accessible to employees in every establishment where employees who are entitled to earned sick time work. Employers are expected to maintain records of accrual and use of sick time for a period of three years and provide a copy of the records upon demand by the AG. The regulations do not specify whether the three-year requirement is rolling or commences upon employment termination.

The regulations also offer clarity on the law as it relates to the definition of “healthcare provider,” attendance policies that reward employees for good attendance, and 90-day probationary periods.

Recommendations. To ensure compliance with the Earned Sick Time Law, employers should take the following actions on or before July 1:

  • Post, in a conspicuous location, a notice of the Earned Sick Time Law and the AG’s regulations.
  • Supply each employee with a copy of the Earned Sick Time Law and the AG’s regulations.
  • Review, create, or modify existing vacation, PTO, and sick leave policies to ensure compliance with the law and regulations, and supply each employee with a copy of the revised policy.
  • Train human resources and supervisory personnel on the new sick leave requirements, including how sick time is accrued and in what increments sick time can be used, the reasons employees may use sick time, and the documentation that employers may request when employees use accrued sick time. Human resources personnel and management should also be trained on the nonretaliation and noninterference provisions of the regulations.
  • Ensure that time and payroll records are sufficiently detailed to reflect the hours that employees worked and the amount of sick leave covered employees accrued and used, to comply with the regulations’ record-keeping provisions.