Executive Summary: On May 2, 2018, Governor Phil Murphy signed into law a bill that requires New Jersey businesses to provide covered employees with paid sick leave. The Act preempts local sick leave ordinances currently enacted by 13 New Jersey municipalities. Employers will need to conform their leave policies within 180 days of this enactment.

Covered Employers: All employers that employ employees in the state are required to provide sick leave to each employee at the same rate and with the same benefits as the employee normally earns.

Eligible Employees: The Act does not apply to employees in the construction industry performing services under contract pursuant to a CBA or to per diem health care employees.

Accrual, Carryover and Cap: If any employer’s existing paid time off policy allows employees to access and accrue leave at the same or greater rate as under the Act and the leave can be used for the same purposes as under the Act, additional leave need not be provided. All other employers are required to provide paid sick leave as designated by the Act.

Covered employees accrue leave at the rate of one hour for every 30 hours worked. Employees may accrue up to 40 hours of leave each year, and employers may cap total accrual at no more than 40 hours at any time. Carryover of unused leave may also be limited to 40 hours each benefit year. Employers may provide employees with the full 40 hours of earned sick leave on the first day of the benefit year, eliminating any carryover.

Use of Leave: Eligible employees may use earned sick leave beginning on the 120th day after the employee commences employment. Further, an employer may choose to allow employees to use leave at an earlier date.

Employees may use earned sick leave for one of the following purposes:

  • Time needed for diagnosis, care, or treatment of, or recovery from, an employee’s mental or physical illness, injury or other adverse health condition, or for preventive medical care for the employee;
  • Time needed for the employee to aid or care for a family member during diagnosis, care, or treatment of, or recovery from, the family member’s mental or physical illness, injury or other adverse health condition, or during preventive medical care for the family member;
  • Absence necessary due to circumstances resulting from the employee, or a family member, being a victim of domestic or sexual violence, if the leave is to obtain medical attention, services from a domestic violence agency or victim services organization, counseling, relocation or legal services;
  • Time during which an employee is not able to work because of a closure of the employee’s workplace, or the school or place of care of the employee’s child, due to an epidemic or other public health emergency, or because of a determination by a public health agency that the presence in the community of the employee, or employee’s family member, would jeopardize the health of others; or
  • Time needed by the employee in connection with a child of the employee to attend school related conferences, meetings, or events or to attend a meeting regarding care provided to the child in connection with the child’s health conditions or disability.

The Act allows employers to require employees to provide reasonable notice up to seven days in advance. If the leave is unforeseeable, an employee must provide notice as soon as practicable. Employers may prohibit employees from using foreseeable earned sick leave on certain dates and may require reasonable documentation if leave that is not foreseeable is used on those dates. In addition, employers may choose the increments in which employees may use earned sick time, provided that it is no more than the number of hours the employee was scheduled to work during that shift.

Other Requirements: Under the Act, employers must notify employees of their rights and keep records documenting hours worked and earned sick leave taken for a period of five years. Violations of this Act shall be subject to the remedies and penalties provided under the New Jersey State Wage and Hour Law as well as a private right of action which includes an award for actual damages.

Bottom Line for Employers: Employers should review current sick leave policies, payroll systems and recordkeeping procedures to ensure compliance with the new paid sick leave law. Employers with a workforce in multiple jurisdictions should consider whether existing policies comply with the variety of paid sick leave laws.