Preparing for Seattle’s paid sick and safe leave ordinance

Preparing for Seattle’s paid sick and safe leave ordinance

Created by Kirsten Daniels of Cairncross Hemplemann with contributions by WRA’s Josh McDonald

On Sept. 12, 2011, the Seattle City Council approved an ordinance by an 8-1 vote, which created a new chapter in the Seattle Municipal Code (SMC). The new chapter (SMC 14.16), referred to as the Seattle Sick and Safe Leave Ordinance, provides minimum requirements for employers with employees who work within the Seattle city limits to provide those employees with paid sick and safe leave. The ordinance also establishes penalties, remedies, and enforcement procedures for employers who fail to do so. The ordinance goes into effect on Sept. 1, 2012.

The ordinance is 29 pages long and contains 51 separate sections, some of which contain complex definitions and/or references to other state or federal laws. This compliance “menu” is designed to give you an overview of the ordinance’s requirements to assist you with identifying and resolving issues. However, this guide is not intended to, nor should it be used as, a substitute for legal counsel. So, when in doubt, call your legal professional for advice.

Appetizers: Coverage and Scope

1. Which employers does the ordinance cover?

All employers, regardless of size, who have one or more employees who perform work within the Seattle city limits are covered by some aspects of the ordinance, such as the anti-retaliation provisions.

2. Which employers are required to provide paid sick and safe leave under the ordinance?

Employers with five or more “full-time equivalent” (“FTE”) employees – regardless of where the employees work – are required to provide paid sick and safe leave to eligible employees. Employers operating for less than two years are exempted from this requirement.

Example: “Bean Me Up, Scotty” is a chain of Star-Trek themed, drive-thru coffee kiosks. Bean Me Up has 15 kiosks in King, Snohomish and Whatcom Counties and employs a total of 25 FTE employees. Only one FTE employee works within the Seattle city limits. Bean Me Up is therefore covered by the ordinance’s paid leave requirement.

3. What is a “full-time equivalent” (FTE) employee?

“Full-time equivalent” (FTE) refers to the number of hours worked for compensation that add up to one full-time employee, based on either a 40-hour work week or on how the specific employer defines “full-time” in writing or practice.

Example 1: The employee handbook for Thai restaurant Fit To Be Thaied states that a full-time employee is one who works at least 40 hours per week. Fit to Be Thaied employs three full-time employees and four part-time employees, each of whom work 25 hours per week. Fit To Be Thaied therefore employs 5.5 FTE employees.

Example 2: The employee handbook for Sand In Your Shoes Seafood Bistro states that full-time employees are entitled to benefits. The benefits section of the handbook explains that full-time employees are those who work a minimum of 35 hours per week. Sand In Your Shoes employs two full-time employees and 17 part-time employees, each of whom work 14 hours per week. Sand In Your Shoes therefore employs 8.8 FTE employees.

4. I employ temporary workers, workers from placement agencies and workers outside the City of Seattle. Whom do I include when calculating FTE employees under the ordinance?

Employers must count all compensated hours for all employees from the previous calendar year, including:

  • Full-time employees;
  • Part-time employees;
  • Temporary employees;
  • Employees who are made available by a temporary service, staffing agency or similar entity; and
  • Employees who work outside of Seattle

5. I’ve heard that the ordinance divides employers into “tiers.” How do I know into what tier my employer falls?

An employer’s specific obligations depend on the number of full-time equivalent (-FTE) employees:

Tier One – Employers with more than four, and fewer than 50, FTEs on average per calendar week during the previous calendar year.

Tier Two – Employers with at least 50, and fewer than 250, FTEs on average per calendar week during the previous calendar year.

Tier Three – Employers with 250 or more FTEs on average per calendar week during the previous calendar year.

Again, tier size is determined by the employers’ number of FTE employees, not the number of individual employees.

6. Does an employer need to count both in-state and out-of-state employees to determine its tier size?

Yes. If an employer has any employees who perform work in the City of Seattle, thus subjecting the employer to the ordinance, an employer must count the compensated hours of all employees when determining into which tier the employer falls, regardless of where those employees work.

Example: Muffin Topz owns and operates 137 restaurants throughout the United States, and employs a number of full-time, part-time and temporary workers in each restaurant. Two of these restaurants are located within the City of Seattle. To determine into what tier Muffin Topz falls, it must consider the compensated hours of the employees at each of its 137 nationwide restaurants, and any corporate offices it may have throughout the country.

7. My restaurant is located outside the City of Seattle, but I periodically send employees into the City of Seattle to work. Does the ordinance apply to me?

Yes. The ordinance applies if employees are performing work within the City of Seattle. However, only the hours worked in Seattle will count toward accrual of paid sick/safe leave.

Example: Fresh is Best operates two restaurants in Kent, Washington. Fresh is Best employs more than five FTE employees. To achieve its mission of offering foods prepared from ingredients grown only in Washington state, Fresh is Best regularly sends three of its employees to the Pike Place Market to purchase ingredients. Because these three employees are performing work within the City of Seattle for Fresh is Best, the ordinance applies to Fresh is Best.

Keep in mind, the employee must work more than 240 hours within the City of Seattle in a calendar year to qualify for paid sick/safe leave. In addition, the paid sick/safe leave can only be used while the employee is working within the City of Seattle. So, in the above example, the employees could not use paid sick/safe leave accrued pursuant to the ordinance for a shift worked in Kent.

8. I opened my restaurant within the past 24 months (2 years). Am I covered by the ordinance?

You are covered by some of the ordinance’s general provisions, such as the anti-retaliation provision. However, you are exempt from the requirement to provide sick and safe leave to employees until you have been operating for two years (24 months) and have at least five FTE employees.

Example: Marguerite opened Rita’s Ritas, a specialty margarita bar on Queen Anne Hill, 20 months ago. One of Marguerite’s servers has requested paid sick leave under the ordinance. Because Rita’s Ritas has operated for less than two years, the employer is not required to provide paid sick leave to the employee. However, Rita’s Ritas may not retaliate against the employee for attempting to exercise her rights under the ordinance.

9. Which employees does the ordinance cover?

Employees are covered if they perform full-time, part-time or temporary work within Seattle city limits. Employees who occasionally work in Seattle are covered if they perform more than 240 hours of work in Seattle within a calendar year.

Example 1: Nicole works as a bartender for a restaurant in Seattle for 30 hours per week. She is a covered employee, because she performs part-time work in Seattle.

Example 2: Jaime works for Fresh is Best as a sous chef. Fresh is Best periodically sends Jaime to the Pike Place Market in Seattle to obtain ingredients. As a result, Jaime works more than 240 hours within the City of Seattle within a calendar year. Jaime is therefore covered.

10. Does the ordinance cover employees based outside the City of Seattle but who occasionally work in Seattle?

Yes. Employees are covered if they perform work in Seattle for more than 240 hours within a calendar year and the employer has five or more employees. However, the paid sick/safe leave must be used in Seattle.

Example 1: See Question 9, Example 2

Example 2: Seth works as a manager for The Eggs Have It, a popular breakfast spot in Spokane. Seth temporarily transfers to Seattle for a period of four months to manage the opening of The Eggs Have It II, then returns to Seattle only on an intermittent basis to oversee the restaurant. Only the hours that Seth works in Seattle count toward accrual of paid sick/safe leave. In addition, Seth’s employer is only required to permit Seth’s use of paid sick/safe leave while he is working in Seattle, not Spokane.

11. Are independent contractors covered by the ordinance?

No. The ordinance applies only to employees.

Note of Caution: The designation of an individual as an independent contractor or as an employee depends on a variety of factors. Improperly classifying workers as independent contractors can lead to severe penalties. Please confer with legal counsel before classifying a worker as an independent contractor.

12. Does coverage include undocumented employees?

Yes. All employees who perform work in Seattle are covered, including employees who are not legally authorized to work in the United States.

13. Can employees waive their rights to protections of the ordinance?

Generally, no. Employees can only waive their rights as part of a bona fide collective bargaining agreement. A collective bargaining agreement is the only exception. Waivers by individual employees or general statements of waiver in an employee handbook or manual are not allowed and will not be enforceable.

14. I don’t provide other benefits to my employees, such as vacation leave or medical benefits. Do I still need to provide sick and safe leave under the ordinance?

Yes. An employer is required to provide paid sick/safe leave as provided in the ordinance even if the employer does not provide other benefits to employees.

B. First Course: Accrual of Paid Sick/Safe Leave

1. When do covered employees begin accruing paid sick/safe leave?

Covered employees who are working on Sept. 1, 2012, when the ordinance goes into effect, will begin to accrue paid sick/safe leave immediately on that date. Accrual rates do not apply to hours worked before Sept. 1, 2012.

Covered employees hired after Sept. 1, 2012, will begin to accrue paid sick/safe leave from the employee’s start date of employment.

2. What is the accrual rate for paid sick/safe leave under the ordinance?

The accrual rate for paid sick/safe leave is based on the tier into which the employer falls, as determined by the number of FTE employees the employer has.

Tier One – Employers with more than four, and fewer than 50, FTEs on average per calendar week during the previous calendar year.

Tier Two – Employers with at least 50, and fewer than 250, FTEs on average per calendar week during the previous calendar year.

Tier Three – Employers with 250 or more FTEs on average per calendar week during the previous calendar year.

For employers falling in Tier One and Tier Two, employees must accrue at least one hour of paid leave for every 40 hours worked.

For employers falling in Tier Three, employees must accrue at least one hour of paid leave for every 30 hours worked.

3. How much paid sick/safe leave can an employee use in a calendar year?

Here again, the number of hours of paid sick/safe leave that an employee may use in a calendar year is determined by the employer’s tier:

Tier One:    40 hours or less per calendar year.

Tier Two:    56 hours or less per calendar year.

Tier Three:    72 hours or less per calendar year.

Tier Three with a Universal PTO policy:    108 hours or less per calendar year.

4. My employee wants to borrow paid sick/safe leave that has not yet accrued. Do I have to allow the employee to do so?

The ordinance permits employers to allow an employee to use paid sick/safe leave before it has accrued; however, the employer is not required to do so.

Example: Herb is a server at I Love Olive Mediterranean Kitchen. Herb has accrued 24 hours of paid sick/safe leave. Herb is having outpatient surgery and knows he will need to miss 32 hours of work, and would like to “borrow” 8 hours of paid sick/safe leave that he has not yet accrued. I Love Olive may permit Herb to borrow eight hours of paid sick/safe time that has not yet accrued, but it is not required to do so under the ordinance. Keep in mind, however, that even if I Love Olive does not loan eight hours of paid sick/safe leave to Herb, it may still have an obligation to provide Herb with unpaid time off under other federal and state laws.

5. How much accrued but unused paid sick time may an employee carry over into the next calendar year?

Employees are permitted to carry over unused hours to the next calendar year, depending on the employer’s tier size:

Tier One:    40 hours or less.

Tier Two:    56 hours or less.

Tier Three:    72 hours or less.

Tier Three with a Universal PTO policy:    108 hours or less per calendar year.

6. I have several employees who are “salaried, exempt” employees, as defined in the Fair Labor Standards Act (“FLSA”). Do exempt employees accrue sick/safe leave under the ordinance and if so, how?

All employees, including employees properly classified as salaried/exempt for purposes of the FLSA or the Washington State Minimum Wage Act, accrue sick/safe leave under the ordinance. However, exempt employees do not accrue paid leave for hours worked in excess of 40 hours per week. Thus, if an exempt employee’s normal work week is 40 hours or more, the employee accrues leave based on a 40-hour work week. If the exempt employee’s normal work week is less than 40 hours, then the employee accrues leave based on the employee’s normal work week.

Example: Carlos works as a manager at the Space Needle restaurant and is properly classified as exempt. Under the terms of his employment agreement with the Space Needle, Carlos’ “normal work week” is 37 hours per week. Occasionally, Carlos works more than 37 hours per week; occasionally, he also works less than 37 hours per week. Under the ordinance, Carlos will accrue paid leave based on his regular 37 hour work week.

7. How do seasonal employees accrue paid leave under the ordinance?

If an employee is laid off and rehired by the same employer within seven months of separation, the previous period of employment will be counted toward the employee’s eligibility to use accrued paid sick/safe leave. The total time of employment must have occurred within two calendar years.

Example: Meegan is a student at the University of Arizona. During her summers off and her Christmas breaks, she returns to Seattle and works full time at Bobby Sox, a 50s-themed diner in University Village. Meegan will retain any previously accrued hours of paid sick/safe leave as long as the time between her departure and return to work is no longer than seven months. Meegan will also continue to accrue paid leave as she continues to work for Bobby Sox.

8. I provide universal paid time off (“PTO”) to my employees, which they can use for sick, vacation or any purpose. Do I need to provide additional paid sick/safe leave in order to comply with the ordinance?

No. Employers who have a PTO policy that combines sick and vacation time do not need to provide additional paid sick/safe leave. However, the PTO policy must provide accrual and the use of paid leave for the same purposes and under the same conditions as the ordinance.

9. How do I inform employees of how many hours of paid sick/safe leave they have accrued?

Employers must provide employees with the amount of their available paid sick/safe leave each time that wages are paid.

Employers may choose a reasonable system for providing this information, such as a statement with available paid sick/safe leave on each pay stub or an online system where employees can access their own paid leave information.

C. Second Course: Use of Paid Sick/Safe Leave

1. Is there a waiting period?

The length of the waiting period depends on whether the employer is a current employer as of Sept. 1, 2012, when the ordinance takes effect.

Employees of current employers have a waiting period of 180 calendar days after the commencement of the employee’s employment, regardless of the number of hours worked by the employee. (Remember, the hours threshold only applies to employees who “occasionally” work in Seattle.)

Example: Pies Like Us hired its first employee in 1999. Marcus began working for Pies Like Us in 2009. Because more than 180 days will have passed since Marcus’ date of hire when the ordinance goes into effect on September 1, 2012, Marcus may use his paid sick/safe leave as soon as it accrues.

Employees of new employers in Tier One and Tier Two can use accrued paid leave after 24-months have passed from the hire date of the employer’s first employee.

Example: Soup For You hired its first employee on Nov. 1, 2011. Filipe started working for Soup For You on Dec.1, 2011. Filipe starts using his accrued paid sick/safe leave on Nov. 1, 2013, 24 months after Soup For You hired its first employee.

2. When can an employee use paid sick/safe leave for “sick time”?

An employee can use leave for paid “sick time” for the following reasons:

  • For the employee’s own mental or physical illness, injury or health condition;
  • For the employee’s own need for medical diagnosis, care, or treatment of a mental or physical illness, injury or health condition;
  • For the employee’s own preventive medical care;
  • For the employee to provide care to a “family member” with a mental or physical illness, injury or health condition;
  • For the employee to provide care to a “family member” who needs medical diagnosis, care, or treatment of a mental or physical illness, injury or health condition;
  • For the employee to provide care to a “family member” who needs preventive medical care.

3. Who is a “family member” for the purposes of paid sick time under the ordinance?

For the purposes of paid sick time, the ordinance borrows the definition of “family member” from the Washington Family Care Act. The Washington Family Care Act defines “family member” as a child, grandparent, parent, parent-in-law, spouse and registered domestic partner. Under the ordinance, “domestic partner” includes partnerships registered with either the City of Seattle or the State of Washington.

4. When can an employee use paid sick/safe leave for “safe time”?

An employee can use leave for paid “safe time” for the following reasons:

  • The employee’s place of employment has been closed by order of a public official to limit exposure to an infectious agent, biological toxin or hazardous material;
  • The employee needs to care for a child whose school or place of care has been closed by order of a public health official to limit exposure to an infectious agent, biological toxin or hazardous material;
  • For reasons related to domestic violence, sexual assault or stalking that affect the employee or the employee’s “family member,” including but not limited to seeking legal or law enforcement assistance, preparing for or assisting in a civil or criminal proceeding, seeking treatment from a health care provider for physical or mental injuries, participating in safety planning, relocating activities or other actions to increase the employee’s safety or the safety of the employee’s “family member.”

Domestic violence means: physical harm, bodily injury, assault or the infliction of fear of imminent physical harm, bodily injury or assault, between family or household members; sexual assault of one family or household member by another; or stalking of one family or household member by another family or household member.

5. Are there circumstances when employees are not entitled to paid safe time?

Yes. Inclement weather (i.e. snow days), loss of power or loss of water resulting in a closure of an employee’s place of business, or closure of school or place of care of an employee’s child, are not acceptable reasons for the use of paid safe time.

6. Who is a “family member” for the purposes of paid safe time under the ordinance?

For the purposes of “safe time,” the Ordinance borrows the definition of “family member” from RCW 49.76.020: spouse, domestic partner, former spouses, former domestic partners, persons who have a child in common regardless of whether they have been married or have lived together at any time, adult persons related by blood or marriage, adult persons who are presently residing together or who have resided together in the past and now have or have had a dating relationship, persons sixteen years of age or older with whom a person sixteen years of age or older has or has had a dating relationship, and persons who have a biological or legal parent-child relationship, including stepparents and stepchildren and grandparents and grandchildren.

7. If an employer has a universal PTO policy, can an employee use all of his or her accrued leave for vacation and not leave any “cushion” for paid sick/safe leave?

Yes. Under an employer’s PTO policy, employees can choose to use their paid leave as vacation, sick or safe leave.

8. Must an employee use paid sick/safe leave in hour-long increments?

Generally, no, but it depends on whether the employee is exempt or non-exempt. For exempt employees, employers should make deductions of paid sick/safe leave in accordance with the FLSA, so as to not risk losing the exemption.

For non-exempt employees, employers can require the use of paid sick/safe leave in hourly increments. However, an employer may choose to permit employees to use paid sick/safe leave in less than hour-long increments if the employer so chooses.

9. Can an employee trade shifts or work additional hours instead of using paid sick/safe leave?

Yes. If both the employer and the employee agree, the employee may work additional hours or shifts during the same or next pay period instead of using paid sick/safe leave.

Specific to “eating and drinking establishments,” employers may offer substitute hours/shifts to employees who request paid sick/safe leave. If an employee chooses to work substitute hours/shifts, the employer may deduct paid sick/safe leave in accordance with Ordinance requirements. Employers are advised to keep a record of each instance this agreement occurs.

Example: Bindu works for a restaurant as a server. When Bindu becomes sick with the flu just before her 6 p.m. to 10 p.m. shift, she may stay home and use paid sick leave for the four hours she misses from work. With mutual consent between Bindu and her employer, she also may stay home and then make-up the missed hours from work in a substitute shift during the same or next pay period. For example, Bindu could work the following Wednesday in a substitute shift from 6 p.m. to 10 p.m. To pay for her work in this substitute shift, Bindu’s employer may use four hours of her accrued paid sick leave.

10. What do I pay an employee who is taking paid sick/safe leave?

Employers must pay employees for sick/safe leave at the same hourly rate and with the same benefits, (including health care benefits) as during regular work hours.

11. Is an employee who is on sick/safe leave entitled to tips that he or she would have earned if at work?

No. Employees are not entitled to lost tips or commissions during use of paid sick/safe leave.

12. Does an employee accrue sick/safe leave while using sick/safe leave?

No. Employers are not required to permit accrual of paid sick/safe leave.

13. Must I “cash out” an employee’s unused paid sick/safe leave when the employee leaves his or her job?

No. Employers are not required to pay for unused paid sick/safe leave upon an employee’s termination, resignation, retirement or other separation from employment. However, cash out of unused sick/safe leave upon an employee’s termination, resignation, retirement is allowed.

14. I disagree with this ordinance! Can I retaliate against an employee for requesting or using paid sick/safe leave?

No. Retaliation is illegal. Employers are prohibited from taking an adverse action or discriminating against an employee for exercising in good faith his or her rights under this ordinance. These rights include (but are not limited to):

  • Using paid sick/safe leave.
  • Informing an employer, union or legal counsel about alleged violations of the ordinance.
  • Filing a complaint about alleged violations of the ordinance.
  • Participating in an investigation of alleged violations of the ordinance.
  • Informing other employees of their rights under the ordinance.

D. Third Course: Requesting Paid Sick/Safe Leave and Medical Documentation

1. My employee handbook has a notice policy for absences and leave requests. Does an employee have to follow this policy when requesting sick/safe leave under the ordinance?

Generally, yes, so long as the employer’s policy does not interfere with the purpose of the leave.

For leave that is foreseeable, a written request should be provided at least 10 days ahead of time (or as early as possible), unless the employer’s customary notice policy requires less advance notice.

For unforeseeable leave, the employee must provide notice as soon as is practicable and must generally comply with an employer’s customary notice policies and/or call-in procedures.

2. Can I require an employee to provide documentation for use of paid sick/safe leave for the purposes of sick leave?

An employee does not need to provide documentation for use of paid sick leave unless the employee is absent for more than three consecutive days.

After three consecutive days, an employer may require documentation, such as a statement signed by a health care provider stating that sick leave is necessary. An employer cannot require the documentation to reveal the nature of the illness or other private medical information.

3. Who pays for documenting use of paid sick leave after more than three consecutive days?

If the employee’s health insurance does not cover this service, the employer and the employee should each pay 50% of the cost of documentation. Expenses are limited to the cost of:

  • Services provided by health care professionals.
  • Services of health care facilities.
  • Testing prescribed by health care professionals.
  • Transportation to the location where such services are provided.

If an employee has declined health insurance from an employer, the employee is not entitled to reimbursement for expenses.

4. Can I require an employee to provide documentation for use of paid sick/safe leave for the purposes of safe leave?

An employee does not need to provide documentation for use of paid safe leave unless s/he is absent for more than three consecutive days. After three consecutive days, an employer may require documentation, as follows:

For documentation of the closure of a school or place of care, an employee can provide notice of the closure in whatever format the employee received it.
For verification of leave taken for domestic violence, sexual assault or stalking, an employee may provide a police report; applicable evidence from the court or the prosecuting attorney; documentation from an advocate, attorney, member of the clergy, medical or other professional; or the employee’s written statement.

E. Dessert: Notice to Employees and Record Keeping Requirements

1. What do I have to do to provide notice of the ordinance to my employees?

Employers are required to provide employees with notice of their rights under this ordinance, including employees’ rights regarding retaliation and the right to file a complaint or bring a civil action if paid sick/safe leave is denied by the employer. There are several things an employer can do to comply with this notice requirement:

  • Include a paper or electronic copy of notice in employee handbooks or other written guidance.
  • Distribute a notice to each new employee at the time of hire.
  • Display a poster created by the Seattle Office of Civil Rights in a conspicuous and accessible place in the workplace. Such posters are available on the Seattle Office of Civil Rights web site: www.seattle.gov/civilrights.

2. Does the ordinance have any record-keeping requirements?

Yes. However, employers are not required to change their record-keeping policies, as long as those records reasonably indicate:

  • Hours worked by employees.
  • Accrued paid sick/safe leave.
  • Paid sick/safe leave taken by employees.
  • An employer must allow the Seattle Office of Civil Rights access to these records in order to investigate potential violations and to monitor compliance with the requirements of the ordinance.

3. Do I have to keep employees’ records pertaining to sick/safe leave confidential?

Yes. Employers must maintain the confidentiality of information provided by an employee who seeks sick or safe time. Such information includes: health information, the fact that an employee or the employee’s family member is a victim of domestic violence, sexual assault or stalking, or that the employee has requested or obtained leave. Like other medical records, the ordinance requires records related to medical certifications to be maintained in a file separate from the employee’s personnel file as confidential medical records.

Employers cannot disclose information provided by the employee without the employee’s consent, unless ordered to do so by a court or administrative agency, or otherwise required by law. 