Like any business owner, you want to take care of your employees and offer the most generous benefits you possibly can. But if you operate a business with multiple locations in multiple states, you know what a compliance nightmare it can be dealing with inconsistent paid leave laws.
The Paid Leave Explosion
Eleven states now require private employers to offer paid sick leave for workers. The problem? There’s no consistent standard. Each state has its own unique laws and compliance requirements as far as who’s covered, when paid leave can be used, accrual rates and waiting periods. Eleven states have paid leave laws — Michigan, Arizona, California, Connecticut, Maryland, Massachusetts, New Jersey, Oregon, Rhode Island, Vermont, Washington and Washington D.C. Some states have no paid leave law at all. To confuse things even more, many cities and local jurisdictions also have their own paid leave laws, and many of those are in states with conflicting state laws. Federal contractors are also covered by special rules.
Talk about a compliance nightmare!
Here in Texas, we have no state law covering paid leave such as FMLA, though most employees still have access to paid leave through other state laws. Austin and San Antonio have attempted to enact their own leave laws but are being challenged in court.
One Size Does Not Fit All
Employers operating across multiple states can’t simply draft a one-size-fits-all paid leave policy. Each employee and each location must be considered on its own merits. Developing a policy gets especially tricky when your local law isn’t compatible with state law.
How can businesses operating in multiple locations stay ahead of the compliance game?
Unfortunately, reliable guidance on compliance has been hard to come by, but here are seven tips that can help you stay compliant:
- Conduct an audit of your paid sick leave benefits, know which laws cover your business, and have your legal counsel confirm your compliance.
- Review your attendance policies to ensure any mandatory notice periods don’t violate applicable leave laws.
- Review your payroll practices to ensure employees are receiving the proper rate of pay for the use of paid leave.
- Update your hiring notices and workplace posters.
- Educate supervisors on how to detect fraud or abuse without unintentionally retaliating against employees for using paid leave.
- Develop a consistent tracking process to make sure employees accurately accrue time and that all time used is accurately credited.
- Work with other local employers and regional Chambers of Commerce to help influence legislation.
Keep an Eye On the Future
Mandatory paid leave is expanding across the country, and laws are changing rapidly. It’s increasingly becoming a ballot issue in city councils and other government bodies. As a result, more and more employers could find themselves operating in jurisdictions that require paid sick and/or family leave for their employees.
There is some pushback to these measures. Cities experimenting with their own paid leave laws are facing stiff competition from business groups and organizations such as the Society for Human Resource Management (SHRM). More than 20 states have passed laws prohibiting local governments from imposing their own rules. But that hasn’t stopped the proliferation of state and local paid leave laws.
Bottom line? Keep a close eye on what’s happening in state capitals and in the municipalities your business operates in. Coordinate closely with employment counsel to stay compliant. And be adaptable.
Need help auditing your current payroll practices? Contact the compliance professionals at Higginbotham.