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Sick Leave Requirement for Contractors

Bookmark and Share On September 7, 2015, President Obama issued Executive Order (EO) 13706, which requires federal contractors and subcontractors to provide paid sick leave to their employees. The EO applies to contracts entered into after January 1, 2017 that are procurement contracts for services or construction; contracts for services covered by the Service Contract Act (SCA); contracts for concessions; or contracts in connection with federal property or lands and related to offering services for federal employees, their dependents, or the general public. The EO adds to the small patchwork of state and local paid sick leave laws scattered across the nation.

Accrual of Sick Leave

Pursuant to the EO, sick leave accrues at a rate of one hour for every 30 hours worked. Employers may cap accrual at 56 hours (seven days) per year. Unused sick leave will carry over from one year to the next and must be reinstated for employees rehired by a covered contractor within 12 months after a job separation.

Unused accrued sick leave does not have to be paid out upon termination.

Use of Sick Leave

Employees may use paid sick leave:
  1. For the employee's own illness, injury, medical condition, or when an employee needs to obtain diagnosis, care, or preventative care.
  2. To care for a child, parent, spouse, domestic partner, or "any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship" who has an illness, injury, medical condition, or who needs to obtain diagnosis, care, or preventative care.
  3. For domestic violence, assault, or stalking situations resulting in an illness, injury, or medical condition or the need for obtaining diagnosis, care, or preventative care.
  4. To obtain additional counseling, seek relocation, seek assistance from a victim services organization, take related legal action for the employee or one of the above-listed individuals in domestic violence, assault, or stalking situations.
Employers are prohibited from interfering with or discriminating against an employee for taking or attempting to take paid sick leave, or for assisting any other employee in asserting his or her rights to sick leave.

Requests for Leave

Requests for sick leave may be made orally or in writing and must include the expected duration of the leave. If the need for leave is foreseeable, employees must provide at least seven calendar days' advance notice. If the need for leave is not foreseeable, notice must be provided as soon as practicable. Paid sick leave cannot be made contingent on the requesting employee finding a replacement to cover any work time to be missed.

If an employee is absent for three or more consecutive days on paid sick leave, the contractor is permitted to request a certification from a health care provider (if the absence is related to a medical condition) or from an appropriate individual or organization (if the absence is related to domestic violence, sexual assault, or stalking). The certification must be provided no later than 30 days from the first day of leave.

Going Forward

The EO mandates that the Department of Labor issue regulations concerning the paid sick leave requirements by September 30, 2016. ThinkHR will continue to monitor and report on developments on this issue.

Benefits and the FMLA Leave

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This question was recently asked of the ThinkHR Hotline team: What benefits must be continued while an employee is on Family and Medical Leave Act (FMLA) leave? What should we do with an employee who is not making his share of the copayments while out on leave?

Their expert answer: Family and Medical Leave Act (FMLA) regulations require that employers continue to provide group health benefits under the same terms and conditions as if the employee was actively at work. There is no requirement under the FMLA to continue other types of benefits offered by the employer. Whether or not an employee’s other benefits continue depend on an employer’s established policy. Any benefits that would be maintained if the employee was on another form of leave should be maintained while the employee is on FMLA leave.

Part of the requirement to continue health insurance benefits “under the same terms” means that both the employer and employee must continue to pay their portions of the group health insurance premium, unless the employer has a different policy for managing premium payments during leaves. The employer is required to notify the employee of the payment requirements while on leave, including the amount of the payment, date due, and where the payment should sent. If the employee fails to pay his or her portion of the premium, the employer may be able to suspend group health benefits for the remainder of the FMLA leave.

In order to suspend benefits for someone on FMLA leave, the employer must allow the employee a 30-day grace period to make payment after the original payment due date. The employee must receive written notice at least 15 days prior to the actual suspension, and the best employer practice is to send a pending suspension notice once the employee is 15 days past the payment date. One important item to note is that even if an employer suspends an employee’s health coverage under these terms, the employer is required to restore coverage without penalty or delay once the employee returns from FMLA leave to a level of coverage that is equal to what the employee had prior to the leave and had not missed premium payments. If the employee does not return from FMLA, the employee whose coverage was suspended for failure to pay premiums during the leave would be eligible for COBRA continuation coverage.

Don Phin, Esq. is VP of Strategic Business Solutions at ThinkHR, which helps companies resolve urgent workforce issues, mitigate risk and ensure HR compliance. Phin has more than three decades of experience as an HR expert, published author and speaker, and spent 17 years in employment practices litigation. For more information, visit www.ThinkHR.com.


Wage Claims: Protect Your Business

Bookmark and Share Wage claims keep rising. According to the Seyfarth Shaw law firm, there were 7,764 federal lawsuits alleging the failure to pay overtime and other wages in the year ended March 31, 2013 –a record high, up 10% from the previous year.

An article in Corporate Counsel magazine discussing the Seyfarth Shaw report, state that these claims usually fall into one of three categories:
  1. Salaried employees who believe they are owed overtime pay
  2. Hourly workers who contend that they weren’t paid for all hours worked
  3. Restaurant workers who claim that they received no additional pay under the FLSA “tip credit” provision
According to Seyfarth Shaw partner Noah Finkel, DOL investigators have been focusing on hospitals and restaurants. Finkel points out that although these cases have been traditionally filed in California and Florida, states such as New York, Missouri, Georgia, and others are experiencing more and more claims. He and other attorneys suggest that you conduct an audit or assessment of your wage and hour practices.

Here are some additional recommendations:

  1. If you're uncertain whether employees are exempt or nonexempt, treat them as if they were nonexempt. They can end up getting paid the same amount at the end of the year as long as you calculate the appropriate wage rate when including overtime payments.

  2. Use a tool such as the Employee Compliance Survey to find out if there are in fact any concerns about wage payment and follow-up on any “yes” answers.

  3. Consider the hours worked by employees both before and after work. For example, in a recent case, a warehouse that required all its employees to go through a security search before they left had been required to pay wages for employees going through that screening.

  4. Know the rest and meal period requirements in your state. Because federal law doesn’t govern this, make sure you that you know your state provisions Check out your BNA State Law Summary on HR That Works.

Are You (and Your Employees) Happy?

Bookmark and Share Do any of these sentences pop up into your head when you're arriving at the workplace?
  • I really dread coming in here today
  • I'm afraid of that __________ today
  • I feel tired just walking into this place
  • This place is a disaster waiting to happen
  • I wish it was Friday
  • I wish I was anywhere but here
  • I'm ready for the fight because I know I'm right
  • I don't care if they fire me today, they're going to learn how I feel about it
  • I have to get so much done and I don't know when I'm going to be able to do it.
Guess what? These thoughts pop up in the heads of your employees. too. My question is what will you do to turn it around?

Many folks will wallow in a horrible complacency. Others will realize that if it's going to change, they have to create this change. It's both an inside and outside job.

Look at your situation like a new employee excited about the opportunity!