Quick Hits

• On May 27, 2025, Philadelphia Mayor Cherelle L. Parker signed the “Protect Our Workers, Enforce Rights (POWER) Act” into law, which strengthens worker protections and enforcement mechanisms in the city.
• The POWER Act empowers the Philadelphia Department of Labor’s Office of Worker Protections to conduct independent investigations, maintain a “Bad Actors Database,” and revoke business licenses for noncompliant employers.
• The POWER Act includes provisions for retaliation protections, immigrant worker support, increased sick pay for tipped employees, extended recordkeeping requirements, and allows workers to file civil actions for violations without exhausting administrative remedies.

Significant measures in the POWER Act include:

• Strengthening Philadelphia’s Department of Labor. The act provides the Philadelphia Department of Labor’s Office of Worker Protections (OWP) with the ability for more thorough workplace investigations and to hold employers accountable under already existing local labor laws, including the wage theft ordinance, paid sick leave ordinance, and Domestic Worker Bill of Rights. This includes the authority to initiate investigations independently (without any formal complaints), broaden the scope of investigations unilaterally, and subpoena records and testimony.

The OWP will also maintain a publicly accessible “Bad Actors Database,” consisting of employers with three or more infractions from separate incidents or circumstances who have failed to comply with ordered remedies in a timely manner. Of note, the Act further empowers the OWP to revoke business licenses and city procurement contracts from employers listed on the “Bad Actors Database.”

• Retaliation Protections. The act reaffirms that employers are strictly prohibited from retaliating against employees for exercising their rights under its provisions—such as filing complaints, taking sick leave, or participating in investigations. Critically, the act presumes unlawful retaliation whenever an employee faces an adverse employment action within ninety days of filing a complaint with the OWP, informs any person about an employer’s alleged violation of the act, cooperates with an investigation or prosecution of an alleged violation, or opposes any policy, practice, or act made unlawful by the act. The burden, therefore, lies with the employer to prove that retaliation did not occur. Employers must demonstrate nonretaliatory intent by clear and convincing evidence, a higher legal burden.
• Immigrant Worker Protections. The act creates clear guidelines for the OWP to certify and submit statements of interest on behalf of immigrant workers who may be eligible for a U Visa or T Visa under the Victims of Trafficking and Violence Protection Act (2000), or for the Deferred Action Program under 6 U.S.C. § 202(5) and 8 U.S.C. § 1103.
• Sick Pay for Tipped Employees. The act raises the hourly rate for paid sick leave for tipped workers under the Philadelphia paid sick leave ordinance. The hourly rate for paid sick time is calculated by taking the numerical average of the hourly wage for “Bartenders,” “Waiters & Waitresses,” and “Dining Room & Cafeteria Attendants & Bartenders Helpers,” as defined under the Standard Occupational Classification, published by the Pennsylvania Department of Labor.
• Notice to Employees. The act requires employers to notify all employees of their rights. To provide slight relief for employers, however, the act removes the requirement that notices of rights be included in handbooks distributed to employees.
• Recordkeeping. The act extends the duration that employers must keep required records from two years to three years. Employers must maintain records of (a) hours worked by an employee, including dates; and (b) hours of sick time taken by an employee and payments made to an employee for the sick time.
• Private Right of Action. A worker who believes he or she has been harmed by a violation of the act may file a civil action in court without first exhausting administrative remedies. The person who allegedly violated the act, however, must be given written notice of the alleged violation and afforded fifteen days to cure the harm. The statute of limitations for bringing such an action is three years from the date the employee knew or should have known of the alleged violation, subject to the exceptions under Section 9-6602(6) and Section 9-6607(5).

Key Takeaways

The POWER Act introduces enhanced mechanisms to enforce compliance with Philadelphia’s existing employment and labor protection laws. Employers may want to:

• monitor the Philadelphia Department of Labor webpage and familiarize themselves with the POWER Act’s requirements;
•  provide employees with a notice of their rights under the act, though this notice does not need to be included as a formal amendment to the employee handbook; and
• review their recordkeeping protocols and practices and update their systems to ensure all required records are retained for at least three years.

In addition, employers may wish to educate supervisors and managers about the impact of disciplinary actions issued after complaints or protected activities.