A First in Texas: Austin Enacts Paid Sick Leave Ordinance

Austin recently became the latest city in the United States, and the first in Texas, to join the paid sick leave trend spreading across the country.  On February 16, 2018, Austin adopted a paid sick leave ordinance that requires private employers of any size operating in Austin (regardless of where the company is based) to provide paid sick leave to their employees working in Austin.  The ordinance will not take effect until October 1, 2018, although it has been challenged in court.  Regardless, employers with employees in Austin should be aware of the basic requirements of the law so they can be in compliance with the ordinance by October 1 if the court challenge fails.  Employers with less than 5 employees have until October 1, 2020 to comply.

The ordinance applies to employees who perform at least 80 hours of work in the city of Austin in a calendar year.  Therefore, this may extend to part-time employees and employees who only spend a portion of their time working in Austin.

The ordinance requires that an employer grant an employee one hour of earned sick time for every 30 hours worked in the city of Austin up to an annual cap.  The annual cap depends on the size of the employer.  Note that employers who already provide leave are not required to provide additional leave so long as their policies provide at least the same benefits and protections as the new ordinance.

Employees can use accrued sick leave for an employee’s own care or that of the employee’s family member.  Employees can also take time off to seek medical attention, seek relocation, obtain victim services, or participate in legal proceedings related to domestic abuse, sexual assault, or stalking involving the employee or a family member.

Under the ordinance, employers are required to provide to each employee a monthly statement showing the amount of the employee’s earned sick time and must also keep records to show the amount of sick time accrued and used by each employee.  Moreover, employers that provide employee handbooks must include a notice to employees about their rights and remedies under the ordinance.  Additionally, when the City of Austin provides signage on its website, employers must display it in English and Spanish in an obvious place where notices to employees are customarily posted.

Looking Ahead

Prior to October 1, 2018, and assuming that the ordinance is not invalidated in court, all employers with employees working in Austin should check their employee handbooks and policies to make sure that they have a paid time off or sick leave policy and that it complies with the ordinance.  Under the ordinance, if an employer’s current paid time off benefits meet or exceed the requirements of the new ordinance, changes may not be necessary.  However, it will still be necessary for employers to meet the notice requirements and make sure there is a plan in place to account for accrual of the leave.

Employers in other cities besides Austin should still stay informed on this issue as sick leave laws are becoming more widespread across the country and the Austin ordinance is similar to the laws that have been adopted in other jurisdictions.  Currently, over 40 jurisdictions in the United States have passed such laws, and federal contractors are also required to provide paid sick leave pursuant to a federal executive order.  Multi-state employers and employers with employees in different cities must review and determine whether their existing policies comply with the variety of paid leave laws across the country.  Such a review should include making sure that the company is complying with the notice, poster, and record-keeping requirements of each law, as well as ensuring that the company is properly accounting for accrual of the leave.