Massachusetts voters recently approved a ballot question that will require the provision of paid sick leave to many employees working in the state. In doing so, Massachusetts became the third state in the country to mandate statewide paid sick leave. The new law requires non-governmental employers with 11 or more employees to provide their employees with one hour of paid leave for every 30 hours worked, up to 40 hours per year. The law will take effect July 1, 2015.

Definitions

A qualifying employer is any entity other than the U.S. government that engages the services of an employee for compensation. Cities and towns will be considered qualifying employers only as required by the state constitution.

The Benefit

If a qualifying employer employs 11 or more employees, it must permit them to accrue a minimum of one hour of paid leave for every 30 hours worked. (If a qualifying employer employs fewer than 11 employees, it must permit them to accrue and use unpaid sick leave according to the same terms.) Absent regulations to the contrary, all employees should be included in this count, regardless of whether they work in Massachusetts.

Leave may be used for the diagnosis, care or treatment of an employee’s health condition or that of an employee’s family member. “Family member” includes an employee’s child (and any individual for whom the employee has assumed the responsibilities of parenthood), spouse, parent (or any other person who assumed the responsibilities of parenthood when the employee was a child) and parent-in-law. Leave may also be used to address the psychological, physical or legal effects of domestic violence.

Qualifying employees are eligible to use their accrued leave after 90 calendar days of employment. When employees take leave under the law, they must be compensated at their regular rate of pay. Employers may cap employees’ use of sick leave at 40 hours per calendar year. Employers may also cap employees’ accrued leave at 40 hours per year. All accrued but unused leave must carry over to the next year (up to 40 hours).

Upon termination, employers are not required to pay out accrued but unused leave.

Notice and Recordkeeping Requirements

Massachusetts’ attorney general will prepare a notice describing employees’ rights under the new law. Employers must post this notice in a conspicuous location at each worksite in the state. They must also provide employees with a copy of the notice. We anticipate the attorney general will issue regulations regarding employers’ recordkeeping requirements.

Penalties for Noncompliance

The law allows the state to bring civil and criminal proceedings against any employer for failing to comply with the law. Employees can also bring their own lawsuits to enforce their rights to paid sick leave. If successful, an employee may recover damages and attorneys’ fees.

Next Steps

Employers can begin to prepare for the law in the following ways:

• Consider whether employees will be entitled to paid or unpaid sick leave when the law takes effect, based on the 11-employee threshold
• Review and update employee handbooks
• Ensure payroll can properly calculate and track individual employees’ accrued and used sick leave
• Train managers and benefits staff on how to comply with the law

Additional Information

If you have any questions regarding Massachusetts’ paid sick leave law, please contact your Kutak Rock LLP attorney or a member of our Employee Benefits Practice Group.