The Sun Is Setting on the Safe Harbor Provision of the New Earned Sick Time LawDecember 10, 2015
The Massachusetts Office of the Attorney General (AG) made news earlier this year when it issued final regulations implementing the new voter-approved Massachusetts Earned Sick Time Law. Effective as of July 1, 2015, the regulations impose new earned paid sick time requirements on employers that averaged at least 11 employees on the payroll during the prior year (as defined by the employer). The regulations also created a “safe harbor” provision that gives certain employers until the end of the year to bring their earned-sick-leave or paid-time-off policies within new law’s requirements. This deadline is fast approaching.
The Genesis of the Final Regulations
The final regulations are the product of an up-or-down ballot vote last November, 2014. When asked whether they would like earned sick time, voters predictably responded, “Yes.” With the issuance of the final regulations, that “yes” vote has become reality and employers must comply with the new requirements. The AG has power to enforce the new requirements, and violators can face hefty penalties as well as civil liability including treble damages, costs, and attorneys’ fees.
In short, the new law requires that most Massachusetts employers provide up to 40 hours of paid earned sick time per year to all employees (whether full time, part time, or seasonal) working primarily in Massachusetts, regardless of the location of the employee’s residence. Even employers with fewer than 11 employees must provide their employees with the right to accrue and use up to 40 hours of unpaid sick time. The regulations specify the purposes for which employees may use earned sick time, and the regulations generally require advance notice before using this sick time (except in cases of emergency). The regulations also place safeguards against the misuse of earned sick time and strictly prohibit interference with or retaliation against an employee’s exercise of earned-sick-time rights.
The Safe Harbor Provision
The regulations acknowledge that many employers might have already had earned-sick-time or paid-time-off policies in place. The regulations do not prohibit employers from having their own policies, but those policies must comply with the new requirements.
As a result, the new regulations created a safe harbor provision. For employers with existing policies in place on May 1, 2015 that provide for at least 30 hours of paid sick time or paid time off for full-time employees, the regulations set a January 1, 2016 deadline for employers to adjust their existing policies to comply with the new requirements. The regulations set specific and detailed requirements for employers to meet in order to benefit from the safe harbor provision. So long as those requirements are satisfied, employers are permitted to continue to administer their existing paid-time-off policies through the end of the year. With this deadline looming, any employers taking advantage of the safe harbor provision should be prepared to meet the requirements of the new law by New Year’s Day.
Employers that did not already provide for at least 30 hours of paid sick time or paid time off are not eligible for the safe harbor provision. For those employers, the regulations require immediate compliance.
Questions Prompted by the Earned Sick Time Law
The new regulations are highly detailed and have given rise to numerous practical and logistical questions concerning their application. These questions have prompted the Massachusetts Attorney General’s Office to release not one, but two sets of answers to Frequently Asked Questions concerning the new law. The most recent of these was posted on November 6, 2015 and is available at http://www.mass.gov/ago/docs/workplace/earned-sick-time/est-faqs.pdf
For those in the construction industry, the full impact of the Earned Sick Time Law is not yet known. Compliance with the new requirements will drive up employer costs. This is expected to become an issue on active projects and could affect how contractors estimate and prepare for future ones.
The bottom line is this: If you are taking advantage of the safe harbor provision, your time is running out. If you are not taking advantage of the safe harbor provision, your time is up. If you are not already familiar with the Earned Sick Time Law and the final regulations, you should become familiar with these new requirements. Not only should you consider the practical and business impacts of the new regulations, you should make sure you are in compliance. The last thing you need is to become a “test case.”