Sick and Safe Law proved not so 'onerous' in Calif.

Washington Business Journal, March 7, 2008

By Jonathan O'Connell

D.C. businesses groups bellyached for months about how the Accrued Sick and Safe Leave Act would cut into bottom lines and prevent growth, but now that the idea is official, how much of a problem will it be?

If early returns from the country's only comparable law are any sign, not much.

The heavily lobbied "sick and safe" legislation unanimously passed the D.C. Council March 4. Mayor Adrian Fenty will sign it in the next few weeks.

There are some basics to the legislation that every employer should know by the time it goes into effect, probably this summer.

First, the mandated leave is only available to employees who have been with the same employer for at least a year and worked at least 1,000 hours in that time, as defined in the District's version of the Family and Medical Leave Act. Only workers based in the city are covered. On-the-go workers such as drivers, delivery people, caterers or cleaners who based in the suburbs but spend time in D.C. are not covered.

The District will do a study to see if this leads to mischief among employers, such as firing and rehiring people without cause, or leads employers to move outside the city.

The law also requires employers to count the number of leave hours their employees earn. For companies that already operate some type of accrual benefit -- vacation or personal days -- compliance might just be a matter of expanding that system to all employees. But for companies with no accrual measurement, this may be an arduous requirement.

The sole point of reference for these issues is San Francisco, the only other U.S. jurisdiction to mandate paid sick leave. Its ordinance, which went into effect Feb. 5, 2007, differs from the District's by covering every employee who works at least 56 hours there in a year. But the law similarly requires companies to count leave hours earned.

San Francisco's law is also only enforced when the city receives a complaint, usually from workers who believes they were unfairly not paid for a sick day. There have been very few complaints.

Greg Asay, a policy analyst for San Francisco's Office of Labor Standards Enforcement, said the poster notifying employees of the benefit was mailed to about 100,000 employers when the ordinance passed and in the first year his agency received only 73 complaints. Of those, 32 required an investigation to be sorted out.

"There are a lot of businesses out there looking at the commitment from a time standpoint and aren't keeping track of their [employees'] hours," said Scott Hauge, who owns San Francisco-based CAL Insurance & Associates and is president of Small Business California, an advocacy group.

It is "kind of strange" that the hours of exempt employees need to be counted but that "overall, I haven't heard too much" in the way of complaints, he said.

Business owners and members of the D.C. Chamber of Commerce repeatedly made dire predictions of the law's passage, suggesting they would not be able to expand in the city or would have to cut back jobs.

That hasn't been the case in San Francisco, even though the D.C. law allows far more exceptions.

"I have not found that employers are reworking their business operations to comply with the sick leave law, because I don't think they're finding it overly onerous," Asay said.

Even the city's chamber agrees. "There was a lot of concern when it was passed and we've heard less about it since," said Carol Piasente, a vice president at the San Francisco Chamber of Commerce.

New rules

Here is how the "sick and safe" law will affect area businesses:

• Employers must post notice of paid leave in the workplace with signs provided by D.C., or risk a fine of up to $1,000 per year.
• The law applies only to employees who have worked at the same D.C. employer for at least one year and logged 1,000 hours in that time.
• Leave can be used if sickness or domestic/sexual abuse affects the worker or the worker's family.
• Workers at employers of 100 or more full-time employees earn one hour of leave for 37 hours worked, up to seven days per calendar year. Workers at employers of 25 to 99 people earn one hour for 43 hours worked, up to five days per year, while those at employers of 24 or fewer earn one hour per 24 hours of work, not to exceed three days per year.
• Employers can apply for an exemption from the mayor if their "fiscal stability" is threatened by complying.
• Independent contractors are exempt.
• Bartenders or wait staff who rely on tips are exempt.
• Health care workers who participate in premium pay programs are exempt (meaning they would not be forced to explicitly trade pay for sick benefits).
• Workers at beauty, hair or nail salons who earn a commission have a separate calculation.