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Here’s the deal: Obama’s compulsory sick pay order

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Here’s the deal: Obama’s compulsory sick pay order

If you’re a federal government contractor, or want to be in the future, there are big changes ahead when it comes to your employees’ compensation. Here’s everything those who do business with the federal government need to know about President Obama’s compulsory paid sick leave executive order, which goes into effect on January 1.

What’s the rule and how did it come about?

The Obama administration has made no secret of its desire to update and improve workplace policies that affect the lives of American workers. The Department of Labor has said paid sick leave will promote a better and healthier workforce and help prevent families slipping into poverty when they are unable to work. It says the White House will continue to push for paid sick leave for all workers.

In September 2015, President Barack Obama signed an executive order for compulsory paid sick leave for the employees of federal contractors.

In September this year, it became a Final Rule, meaning it cannot be overturned and affected workers will be able to accrue up to seven days of paid sick leave a year. The Department of Labor estimates the rule will provide paid sick leave to about 1.15 million workers employed by federal contractors.

For business owners it means if you want to do business with the federal government, you have to pay your workers sick pay.

How does it work?

Under the Final Rule, employees of any business contracted to supply to the federal government will accrue one hour of paid sick leave for every 30 hours working on or in connection with a covered federal contract, for up to 56 hours of leave a year.

Workers will be able to use the days to receive medical attention, care for a relative or deal with complications arising from domestic violence or sexual assault.

Contractors can either provide an employee with at least 56 hours of paid sick leave at the beginning of each accrual year or allow the employee to accrue leave based on the hours worked.

As an employer, what will my obligations be?

As a contractor, you will have to allow your workers to use their paid sick leave in chunks of as small as an hour, except if their work makes it physically impossible to leave or return to the job during a shift.

You can only limit the amount of paid sick leave an employee uses on the basis of how much they have available, and when they use their sick leave, you have to provide them with the same regular pay and benefits they would have received if they were working (although they don’t earn additional paid sick leave during that time).

If an employee wants to use their sick leave, they can request it from you verbally or in writing, but they have to provide seven days’ notice if they know a reasonable amount of time in advance that they need to take it.

If you refuse a worker sick leave they’ve asked for, you’ve got to tell them in writing and give a reason and that can’t be based on whether the employee has been unable to find a replacement worker or on your operational needs.

You can ask for certification only for absences of three or more consecutive full days, but you will need to tell your employee that they need to supply this before they return to work. You’ll also need to notify your employees in writing how much sick leave they have accrued, either at the end of each pay period or every month — whichever is shorter.

Who does it affect and when does it go into effect?

The Rule only affects contracts solicited (or renewed) by the government beginning on January 1, 2017. There are a minority of exceptions, but you will need to check with the Department of Labor. Recently dozens of cities and states around the country have passed their own laws on mandatory paid sick leave but the Department of Labor says that employers and contractors won’t be disadvantaged and employees won’t be able to take advantage of both provisions.

More information is available on the Department of Labor’s website or by calling the Wage and Hour Division’s toll-free information and helpline between 8am and 5pm in your time zone on 1-866-4-USWAGE (1-866-487-9243).

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