The Minneapolis City Council will soon vote on whether to adopt a draft ordinance that will require employers to provide paid sick leave to employees, beginning in July of 2017.  Here’s what employers need to know about the proposed ordinance and the upcoming vote:
When will the paid sick leave ordinance take effect?  If passed, the effective date of the ordinance will be July 1, 2017.
How much paid sick leave will the ordinance require?  The ordinance will require that employees must accrue a minimum of one hour of paid sick leave for every 30 hours worked, up to a maximum of 48 hours in a calendar year.  Employees may carry over up to 80 hours of unused sick leave per year.  The sick leave begins to accrue at the beginning of an employee’s employment (or July 1, 2017 when the ordinance will take effect), but it may not be used until 90 calendar days after the commencement of employment.  Employees may use the sick leave for a variety of reasons, including but not limited to:  (i) an employee’s health condition or need for treatment or preventive care; (ii) the care of a family member with a health condition or who requires treatment or preventive care; (iii) absences due to the domestic abuse, sexual assault, or stalking of the employee or an employee’s family member; (iv) the closure of a business by a public official due to a health issue; or (v) the closure of the school of an employee’s child by a public official due to a health issue.  The ordinance will also prohibit employers from retaliating against employees for the use of paid sick leave.
Can employers require advance notice or documentation for paid sick leave?  For foreseeable leave, an employer can require up to seven days advance notice of the need to use paid sick leave.  For unforeseeable leave, the employer can require the employee to provide notice as soon as practicable.  The employer may require reasonable documentation of the need for paid sick leave only if paid sick leave is used for an absence of three or more consecutive days.
What employees will be covered by the ordinance?  Any employee (exempt, non-exempt, part-time, or temporary) who performs work for an employer within the geographic boundaries of the City of Minneapolis for at least 80 hours in a year will be covered by the ordinance.  For a full-time employee, that means that an employee who spends at least 3.8% of his or her working time within Minneapolis will typically be covered, even if the remaining 96.2% of the working time occurs elsewhere.  To administer this requirement, the ordinance will require that employers with employees who occasionally work in Minneapolis must track and keep records of the hours that those employees work within the City.  The ordinance will not apply to independent contractors, construction workers who are paid the prevailing wage rate, construction worker apprentices paid in accordance with State law, and casual health care employees (such as doctors, nurses, and emergency room personnel) who work at uncertain or irregular times as needed by an employer and who are paid at least four times the federal minimum wage.
What employers will be subject to the ordinance?  The ordinance will apply to employers with at least “6 or more employees,” regardless of whether those employees are employed within Minneapolis or not.  For established businesses, the number of employees will be determined based on the average number of employees during the previous year.  For new businesses, the number of employees will be determined based on the average number of employees during the first 90 days after the business’s first employee begins to work.
How will the ordinance be enforced?  The ordinance will be enforced by the Minneapolis Department of Civil Rights.  An employee may report a violation to the Department within one year of its occurrence.  After receiving a report, the Department will investigate and determine whether a violation occurred.  During the investigation, the employer will have the opportunity to provide a written position statement in response to the alleged violation.  If the Department determines that a violation occurred, the employer will have a right to appeal by requesting a hearing with an administrative hearing officer within 15 days.  After that, the employer may seek a writ of certiorari to appeal the matter to the Minnesota Court of Appeals.  The Department of Civil Rights may also refer the matter to the Minneapolis City Attorney, who can seek to enforce the ordinance through a civil lawsuit in district court.
What are the potential penalties for violations?  During the first 12 months after the ordinance takes effect, the Department of Civil Rights will only have authority to mediate disputes, issue warnings, and issue notices to correct.  After the first 12 months, the Department will be able to impose the following forms of relief and penalties: (i) reinstatement and back pay; (ii) crediting of sick time accrued but not credited plus payment for that sick time multiplied by two, or $250, whichever is greater; (iii) payment of sick pay unlawfully withheld plus payment for that sick time multiplied by two, or $250, whichever is greater; (iv) a $1,500 administrative penalty payable to the employee; or (v) an administrative fine payable to the City of up to $50.00 for each day during which the violation continued.
What notice requirements will apply?  The ordinance will require employers to post a notice of employee rights relating to paid sick leave in the workplace.  The notice will be developed and published by the Department of Civil Rights.  Employers who provide employee handbooks also must include in their handbooks a notice of employee rights and remedies under the ordinance.  In addition, each time an employer pays wages to an employee, the employer must provide a written statement to the employee regarding the amount paid sick leave available to them and the amount of paid sick leave that they have used.  The employer can include this information on a pay stub or may develop an online system for employees to access the information.
What recordkeeping requirements will apply?  Employers will be required to maintain accurate records of accrued and used paid sick leave and must allow an employee to inspect the records relating to that employee at a reasonable time and place.  In addition, an employer with employees who occasionally perform work within the City of Minneapolis will need to track hours worked in the City by each employee performing work in the City to determine whether they are covered by the ordinance.
Will paid sick leave need to be paid out to terminated employees?  No.  The ordinance does not require employers to pay terminated employees for accrued, but unused paid sick leave.
Does the Minneapolis City Council have authority to pass this ordinance?  The draft ordinance states that the Minneapolis City Council has authority to pass the ordinance pursuant to is police power to preserve and protect safety, health, and general welfare.  However, there is a question whether the ordinance, if passed, may be preempted by existing State law.  If passed, it is possible that some or all of the ordinance’s provisions will be subject to a legal challenge.
How can employers provide input to the City Council regarding the draft ordinance?  The last chance for employers to provide input regarding the draft ordinance before the City Council is scheduled to vote on it will be on May 18, 2016.  A public hearing will be held at 3:00 p.m. at Minneapolis City Hall on May 18, 2016, to discuss the ordinance.  The City Council will vote on the ordinance on May 27, 2016, but there will be no opportunity to provide input on the ordinance before the vote that day.
Is the paid sick leave ordinance a good idea?  There are both supporters and opponents of the draft ordinance.  The arguments in support of the draft ordinance are listed in the “Findings” section of the draft ordinance.  In contrast, the Star Tribune Editorial Board recently published an editorial opposing the ordinance, which lists many of the arguments against the draft ordinance.