Providing Developments & Insight on Trending Topics in Employment Law

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In February 2018, the City of Austin, Texas became the first major southern city in the United States to enact a private sector paid sick and safe leave ordinance. The ordinance, which takes effect on Oct. 1, 2018, for employers with five or more employees and Oct. 1, 2020, for smaller employers, provides that employees who work at least 80 hours in Austin in a calendar year will accrue paid leave at the rate of one hour for every 30 hours worked in the city, up to 64 hours annually (or up to 48 hours annually for businesses with 15 or fewer employees). For employees covered by collective bargaining agreements, the accrual cap may be modified — so long as the modification is expressly stated in the agreement. The ordinance is designed to set forth minimum requirements for leave accrual and use. Accordingly, it expressly permits employers to continue or adopt practices that provide the same or greater leave benefits to employees.



Leave Usage Limitations

Under the new ordinance, accrued paid leave may be applied, in no smaller than one-hour increments, to absences occasioned by:
<ul>
 	<li>an employee’s own physical or mental illness or injury, preventive medical or health care, or health condition;</li>
 	<li>an employee’s need to care for a family member’s physical or mental illness, preventive medical or health care, or health condition; or</li>
 	<li>an employee’s need to seek medical attention, seek relocation, obtain services of a victim services organization, or participate in legal or court-ordered action related to an incident of victimization from domestic abuse, sexual assault, or stalking involving the employee or a family member.</li>
</ul>
The ordinance defines “family member” as an employee’s spouse, child, parent, or any other individual related by blood whose close association with the employee is the equivalent of a family relationship.

Employees are required to make a “timely” request to use paid sick and safe leave before their scheduled work time, except when the absence is due to unforeseeable circumstances. To prevent leave abuse, employers are authorized to adopt “reasonable verification procedures” to employee leave applied to absences of more than three consecutive workdays; but the ordinance is silent on — and, therefore, seems to prohibit — employer policies requiring employees to present documentation such as doctors’ notes or court summonses to verify the true nature of shorter absences.

While leave accrual begins as of the first day of employment (or the date the ordinance takes effect, whichever is later), and earned leave is generally available for use as soon as it is accrued, employers may restrict new employees from using accrued leave during the employee’s first 60 days of employment if the employer establishes that the employee’s term of employment is at least one year.

Leave Carryover

Employees will be entitled to carry over unused leave time into the following year up to the annual accrual cap, or, alternatively, an employer may choose to make at least 64 hours of leave (or 48 hours for employers with 15 or fewer employees) to employees at the start of the year.

Employee Notice

Employers offering an employee handbook will be required to provide written notice of employee rights under the ordinance in the handbook. Employers will also be required to provide employees with an electronic or written statement showing available sick and safe leave on at least a monthly basis, as well as display a notice of rights poster that will be made available in the future by the City of Austin.

Retaliation Prohibited

The ordinance prohibits an employer from transferring, demoting, discharging, suspending, or reducing the hours of an employee, or directly threatening such actions against an employee, for requesting or using earned leave or reporting a violation of the ordinance or participating in a related administrative proceeding. Complaints of violations will be investigated by the City of Austin Equal Employment Opportunity/Fair Housing Office, which may assess a civil penalty up to $500 for each violation. Notably, however, the ordinance does not create a criminal offense, and does not expressly create a cause of action against an employer for denying leave or otherwise violating the ordinance’s provisions.

Legislative and Judicial Challenges

Within hours of the ordinance’s passage in February, state representative Paul Workman, a Republican whose district covers much of the county in which Austin is located, pledged that he would introduce legislation on the first day of next year’s session (Jan. 8, 2019) in an effort to have the ordinance repealed. More recently, a coalition of local and national business associations (in addition to the State of Texas, as an intervening party) filed a state court lawsuit seeking in part a temporary injunction of the ordinance, arguing that the ordinance conflicts with existing state law by effectively raising the minimum wage, and that it violates the Texas Constitution. The injunction request was denied in late June, however, clearing the way for the ordinance to take effect this fall, pending further court action as the challenging parties weigh their options for appeal of the denial and the case continues to be litigated in district court.

Additional Texas Cities May Follow

In May 2018, paid sick leave advocates in San Antonio submitted to city officials about twice the number of signatures necessary to get a mandatory paid sick leave ordinance on the ballot in November. In June, supporters in Dallas submitted signatures in support of a similar November ballot initiative there. As with the Austin ordinance, the viability or longevity of such local legislative measures, if passed, will depend on whether the more conservative Texas legislature — which has recently enacted legislation banning local ride-share regulations, fracking bans, and “sanctuary city” policies — enacts preemption and/or repeal legislation next year.

Groundbreaking Austin Paid Sick Leave Ordinance to Take Effect This Fall