Paid leave

The Rule of 7: President Obama Signs New Executive Order Requiring Paid Sick Leave for Federal Contractors

Image courtesy of Newsweek.

Image courtesy of Newsweek.

On Labor Day 2015, President Obama continued his ambition to leave a legacy by signing a new controversial Executive Order.  This Executive Order requires federal contractors to offer covered employees 7 days of paid sick leave.  Key word: PAID.  The President then encouraged Congress to pass similar legislation requiring paid sick leave for all private-sector employees (cue Republican heartburn). Such legislation would finally put the U.S. on the map of industrialized nations requiring paid sick leave.  To put it in perspective, of the 22 wealthiest countries in the WORLD, the U.S. is the only one without paid sick leave.

Here is a breakdown of what you need to know:

  • The new Executive Order requires federal contractors to offer at least 7 days of earned sick leave.  This leave must be paid based on the worker's salary, hourly rate, or prevailing wage.
  • This paid leave will be available for: physical or mental illnesses, injuries, or medical conditions; obtaining a diagnosis or preventative care; the care of a parent, child, spouse, partner, or blood family member; and absences due to dometic abuse, sexual assault or stalking.
  • If the workers uses 3 consecutive days of paid sick leave, the federal contractor can require a medical certification from a physician.
  • Use of this required paid sick leave cannot be made contingent on finding a replacement worker. 
  • Federal contractors can require a 7 day notice period, if the notice is practicable under the circumstances (e.g. advance notice for a known doctor's appointment = ok; advance notice for having the flu = not ok).
  • If the worker does not use all 7 days of paid sick leave, it will carry over from year to year BUT federal contractors are not required to pay out any accrued sick days upon a worker's separation of employment (unless you have a policy stating otherwise).
  • This new requirement is in addition to similar requirements under the Davis-Bacon Act and the Service Contract Act and these required sick days cannot be used as a credit towards fringe benefit obligations under these or similar acts. 
  • Federal contractors with existing paid leave policies that apply to all employees will satisfy this Executive Order so long as the same requirements are met (e.g. the amount of paid leave is at least 7 days, etc).
  • Federal contractors are expressly forbidden from retaliating or discriminating against a worker who requests use of his or her paid sick leave. 

Although this Executive Order will only apply to federal contracts initiated on or after January 1, 2017, federal contractors should consider preparing for this change now as opposed to December 31, 2016.  Perhaps in the near future, private-sector employers can begin making similar changes to their leave policies for the 40% of private sector employees without access to paid sick leave.  #LEADONLEAVE



Netflix Wins with new Unlimited Parental Leave Policy

Netflix wins me over time and time again.  Not only did they resurrect one of the best television shows of all time (Arrested Development, of course) and bring back Wet Hot American Summer as a television mini-series, they have also sent a message about work-life balance:  it's important

Yesterday Netflix announced that they would be offering new parents unlimited maternity and paternity leave for the first year following a child's birth or adoption.  It is also highly important to note that this unlimited parental leave is PAID.  

Why would the streaming movie giant take this risk? According to Netflix's Chief Talent Officer, Tawni Cranz, the reasoning is simple: "people perform better when they are not worrying about home." In other words, eliminate the "worry" and promote performance.  Tawni further states: "this new policy, combined with our unlimited time off, allows employees to be supported during the changes in their lives and return to work more focused and dedicated." 

Yes, you read that correctly.  Netflix also has had an unlimited vacation policy for salaried employees since 2002.  

Netflix's new parental leave policy is a clear stance in favor of work-life balance and certainly the sign of a trend that merits a conversation nationwide.  Currently, the only federal law in the United States regarding maternity and paternity leave is the Family Medical Leave Act (FMLA) enacted in 1993.  Although this federal statute requires employers with 50 or more employees to offer 12 weeks of job-protected leave for the certain qualifying events, such as the birth or adoption of a child, this leave is unpaid and often difficult to manage.  For many families, unpaid leave is simply not an option and the requirement of "job-protected leave" has been interpreted by courts to actually mean that the employer need only return the employee to the "same or similar position" in terms of pay and scope of duties. This is all, of course, assuming the employer has an adequate HR department to properly handle FMLA leave (which is a lot harder than you may think).   In terms of state equivalents, only a handful of states have them (less than 10) and North Carolina is not among those that do. 

Will this Silicon Valley trend follow across the country to North Carolina?  Maybe.  At the very least this is a conversation companies should be having.  It is completely understandable that unlimited time off is not an option for an employer but everyone should at least have a parental leave policy in place.  Work-life balance is consistently ranked among young talent as a top concern with job hunting so being prepared to accommodate this concern is key to maintaining (and retaining) talent in your company. 

If you would like to discuss your options in more depth, want a FMLA refresher, or would like a maternity/paternity policy drafted, give me a call and we can chat.  Also checkout our Business Resources page for more information from the Department of Labor.  #themoreyouknow