Earlier this month the San Antonio City Council approved major changes to the city’s paid sick and safe leave ordinance. San Antonio’s ordinance was scheduled to take effect August 1, 2019. The effective date was delayed when several business groups filed suit to challenge the city’s authority to enact the ordinance and the city agreed to delay its effective date until December 1, 2019. This delay was meant to give the city council time to vote on amendments that it hoped would placate concerns from the business community. Below we summarize significant amendments to the ordinance, and notable changes made to the “frequently asked questions” (FAQs) published by the enforcement agency. We also provide a brief update regarding litigation over similar ordinances in Austin and Dallas.
San Antonio Paid Sick and Safe Leave Ordinance
New Effective Date
The new effective date for the amended ordinance is December 1, 2019, which is the same delayed effective date the city agreed to in litigation.
Covered & Excluded Employees
Originally, the ordinance required employers to provide paid sick and safe leave to any employee who performed at least 80 hours of work for pay within San Antonio in a year. As amended, any individual who performs work for pay in San Antonio for an employer without regard to the number of hours worked, is covered. An exception was added, however, to impose a specific hours-worked-requirement for employees who work in San Antonio on an occasional basis. Specifically, an employee who is typically based outside of the city (i.e., who works outside San Antonio for more than 50% of work hours in a year) and performs work in the city on an occasional basis is covered only if the employee performs more than 240 hours of work in the city within a year. The ordinance now also has an exception for unionized workers.
Employer Coverage Exception
The amended ordinance does not apply to any person, company, corporation, or firm subject to, or with employees subject to, the federal Railway Labor Act.
Revised List of Family Members
In the original version of the ordinance, employees could use leave to care for or assist their child, parent, spouse, or any other individual related by blood or whose close association with the employee is the equivalent of a family relationship. The amendments narrow in part, and broaden in part, who is a family member. As revised, the definition of covered family member includes a parent of a minor child, a spouse, domestic partner, or significant other, any family member within the second degree of consanguinity or affinity, and a member of the employee's household.
Accrual, Carry-Over & Use Caps
All San Antonio employers now must allow employees to accrue up to (or frontload), carry-over (unless frontloading), and/or use 56 leave hours in a year. Previously, the accrual and carry-over caps varied by employer size, with a use cap of eight days. For employers using an accrual-based system to comply with the law, the enforcement agency's revised FAQ continue to interpret the ordinance as a "maximum bank" law, meaning employees can accrue up to the 56-hour cap, at which point accrual temporarily stops and does not resume until an employee uses leave.
Originally, employers could impose a 60-day waiting period to use leave, but only for employees with an established term of employment of at least one year. As amended, employers may set a waiting period of up to 90 days from the start of employment. How broad or narrow an employer's ability to implement a waiting period is remains uncertain, however, based on apparent inconsistencies between the ordinance and the enforcement agency FAQ.
The recent revisions did not substantially change the standard for when employers can require employees to verify leave was taken for a covered purpose, when an employee uses leave on more than three consecutive work days. The amendments clarify that employers cannot request verification until an employee's fourth consecutive day of leave use. Notably, the amended ordinance explains that employees may choose what documentation to provide when responding to this type of request, which can include an employee's written statement that sick or safe leave was taken.
The amendments also include provisions intended to assist employers with leave management. For example, if an employee fails to comply with verification requirements, discipline can be imposed. Additionally, the city added provisions to help fight leave abuse. Employers suspecting abuse may now request verification of the employee’s need for leave, even if the leave does not last four consecutive days. The ordinance includes a description of indications of patterns of abuse, such as “repeated use of unscheduled sick and safe leave on or adjacent to weekends, holidays, [and] vacation,” among others.
Finally, under the amended ordinance, employers must keep confidential the information they obtain connected to leave requests and use. Such information cannot be disclosed unless the employee consents, a court or agency orders disclosure, or disclosure is required by law.
Payout upon Separation
The amended ordinance clarifies that employers are not required to pay out the balance of unused leave upon separation from employment. Moreover, employers that choose to payout such balances are not required to reinstate sick and safe leave upon rehiring the employee (as might otherwise be required by the ordinance).
Penalties & Enforcement
Although a penalty continues to max out at $500 under the amendments, there is a higher burden to meet before a penalty can be imposed. Previously, any violation was subject to a penalty, but the amendments require a penalty only if an employer intentionally, knowingly, recklessly, or negligently violates the law. The amendments also provide that each day a violation is committed or permitted to exist is a separate offense.
Complaints can still be filed with the San Antonio Metropolitan Health District, but the amendments decrease the amount of time an individual has to file a complaint from two years to one year from the violation date.
Since our last Austin update in July, there have not been any significant developments with the lawsuit challenging Austin’s ordinance. The parties continue to work on their written arguments to the Texas Supreme Court, and briefing will not be complete until December 4, 2019. Accounting for possible extensions of existing deadlines, and the time the court will need to consider the issues, we do not expect a decision from the Texas Supreme Court until sometime next spring. Until then, the temporary injunction – staying the Austin ordinance – will remain in effect.
Like San Antonio and Austin, Dallas has been sued by various business groups. Unlike its counterparts, however, Dallas’s paid sick and safe leave ordinance went into effect as scheduled on August 1, 2019. Currently, a federal district court judge is considering whether to grant the city's motion to transfer the case to a different federal court. The decision will determine whether, if at all, the judge will later rule on pending motions the challengers filed to enjoin the ordinance during litigation – similar to what occurred in Austin – and the city's motion to dismiss the lawsuit.
For now, the Dallas ordinance remains in effect, and covered employers with six or more employees may currently be obligated to provide required leave to eligible employees. However, no penalties will be assessed for violations until April 1, 2020, except for violations of the anti-retaliation provision.
What should employers do?
Employers that may be covered under any of the ordinances for San Antonio, Austin, or Dallas should consider their compliance needs. Given the complexity of the issues involved, and uncertainty about the course of litigation in this area, employers are encouraged to consult with knowledgeable employment counsel.