On April 3, 2020, New York State enacted a statewide paid sick leave (PSL) law impacting all private employers in New York. The law requires employers to provide up to 40 or 56 hours of annual sick leave (depending on their size and net income).

While the law became effective on September 30, 2020, and employees became eligible to start accruing leave on that date, entitlement to use leave under the law begins on January 1, 2021. In advance of that date, the New York State Department of Labor published PSL guidance and answers to frequently asked questions (FAQs).

The guidance and FAQs provide clarification on several areas of the law, including:

Calendar Year

• For the purposes of calculating the total number of employees and determining which leave requirements apply, employers must use the 12-month period from January 1 to December 31 as the “calendar year.”

• For the purpose of determining employee use and accrual of leave, an employer may designate any 12-month period as the “calendar year.”

Eligibility to Accrue and Use Leave

• All private-sector employees who physically work in New York State are covered by the law, “regardless of industry, occupation, part-time status, and overtime exempt status.”

• While employees of federal, state, and local governments are not covered, employees of charter schools, private schools, and not-for-profit entities are covered.

• After employees commence employment, they may immediately begin accruing leave, and, starting January 1, 2021, may use their accrued leave.

• Out-of-state employers must provide PSL to employees who physically work in New York State.

• Employees who telecommute to a New York State office will accrue leave only for the hours that they physically work in New York State.

• The FAQs reiterate that the law requires “employers with between 5 and 99 employees in any calendar year … [to provide] each employee with up to 40 hours of paid sick leave in each calendar year.” The guidance states that “[e]mployers with 100 or more employees must provide up to 56 hours of paid sick leave per calendar year.” The FAQs and guidance, however, are silent as to whether employers should count employees regardless of whether they are located inside or outside New York State. The FAQs describe the 40-hour requirement as being applicable to “small employers.” Absent further clarification from the New York State Department of Labor, employers may wish to take a conservative approach and count all employees regardless of their location.

Rate of Pay

• PSL is paid at the employee’s regular rate of pay. The employer is not required to pay an overtime rate, even if the PSL time—if worked—would have constituted overtime. If an employee has multiple pay rates, the applicable pay rate for PSL hours must be a weighted average of those rates.

• Employers may not take a tip credit from an employee’s wage rate for PSL hours.

• Employers are not required to pay employees for lost tips or gratuities during PSL time.

Front Loading and Carry-Over

• Employers may front load sick time at the beginning of the calendar year. The guidance states, however, that an employer may not later revoke or reduce such front-loaded leave if the employee works fewer hours than anticipated.

• An employer is generally required to allow employees to carry over accrued but unused PSL hours each calendar year. However, if the employer front-loads the full 40 or 56 (as applicable) hours at the beginning of each calendar year, additional carry-over is not required.

Requesting Sick Leave

• An employee is entitled to use sick leave on request, which they can make orally or in writing.

• Provided that employees furnish notice that they plan to use their accrued sick leave, there is no specified minimum notice period requirement.

Collective Bargaining Agreements

• A collective bargaining agreement (CBA) entered into on or after September 30, 2020, may provide employees with different benefits than those provided by the PSL law as long as those benefits are “comparable” to the PSL law benefits and the CBA “specifically acknowledges” the provisions of the PSL law (including specifically identifying any benefits deemed comparable to PSL).

Recordkeeping and Notice

• Consistent with existing New York wage and hour requirements, employers are required to keep payroll records for six years.

• Payroll records must include the amount of sick leave accrued and used by each employee on a weekly basis.

• Upon a request from an employee, within three days of the request, an employer must provide a summary of the amount of sick leave accrued and used in the current calendar year and/or any previous calendar year as applicable.

• Employers must advise employees in writing or by posting a notice at the job site of any restrictions or limitations in their leave policy.

Interaction with Other Leave Laws

• The New York City Paid Safe and Sick Leave Law remains enforceable to the extent those provisions meet or exceed the standards and requirements in the PSL.

• PSL is a separate and additional benefit to quarantine leave for employees subject to a precautionary or mandatory order of quarantine or isolation related to COVID-19.

• The PSL entitlement is also independent of any other applicable federal or state leave entitlements.

Penalties

• Failure to provide sick leave under the PSL law may subject an employer to “civil/administrative actions and/or criminal penalties,” including “the full amount of the wage underpayment, 100% liquidated damages, and civil and penalties in an amount up to double the total amount to be due.”

Next Steps for New York State Employers

New York State employers may want to consider the following measures:

• reviewing current sick leave policies and practices, including to ensure that employers with 100 or more employees comply with the requirement to provide their employees with 56 hours of PSL per year;

• for employers that use an accrual model for sick leave, taking steps to track accrued leave effective September 30, 2020;

• ensuring that sick leave policies and policies concerning attendance and anti-retaliation meet the PSL law’s requirements;

• reviewing payroll practices to ensure alignment with the requirements of the PSL law and guidance;

• monitoring and reviewing materials published by the New York State Department of Labor to ensure compliance with the law’s notice and posting requirements; and

• training supervisory and managerial employees, as well as human resources professionals, on the requirements of the law.