In September of 2018, the Michigan Legislature voted on and approved a ballot initiative, known as the Earned Sick Time Act (“ESTA”) – a statewide mandate that would have required employers to provide employees with earned sick time for certain covered absences. The state legislature reserved the right to amend it by a simple majority vote before the ESTA’s expected effective date of on or about April 1, 2019 and they did on December 18, 2018.
Senate Bill No. 1175, now known as the Paid Medical Leave Act ("PMLA") was approved by Governor Rick Snyder, solidifying a major overhaul of the sick leave standards set out under the ESTA. The new law is expected to take effect in late-March 2019 making Michigan the 11th state in the country with a statewide sick leave mandate.
The most notable change in the amended law is the change to which it applies only to employers with 50 or more employees and creates a rebuttable presumption that an employer is in compliance with the Act if the employer provides at least 40 hours of paid leave to employees each year.
Similar to Washington's paid sick leave law, it applies only to non-exempt employees.
How does it work?
Under the amended law, employees accrue one hour of paid sick leave for every 35 hours worked, up to a maximum of 40 hours per year (the original version of the law provided for one hour of paid sick leave for every 30 hours worked, up to a maximum of 72 hours per year).
Employees may only use 40 hours of paid sick leave per year and may only carry over up to 40 hours of unused sick leave to the following year. The law permits employers to provider all 40 hours to an employee at the beginning of the year (called front loading). If an employer front loads the paid sick time they are not required to carry over any unused sick time.
Additional Highlights of the PMLA
Eligible Employees: Unlike the ESTA, the PMLA narrows the definition of eligible employees. To be eligible the employee must have (1) worked an average of 25 hours or more per week in the immediately preceding calendar year, and (2) their prior work location be in Michigan.
Whose covered: Only employers with 50 or more individuals are subject to the paid sick leave under the PMLA, unlike the ESTA which created obligations for "small employers". As of right now the PMLA does not give further clarification as to whether the size of the employer is based on the Michigan-only workforce or its total workforce. Further guidance is expected.
Waiting Period: The PMLA allows employers to implement a usage waiting period of 90 calendar days for new hires.
Reason for Use: The reason for use did not change as provided under the ESTA except that absences “for meetings at a child’s school or place of care related to the child’s health or disability, or the effects of domestic violence or sexual assault on the child” are not protected. Paid medical leave may be used in one hour increments, unless the employer has a different increment policy in writing in the employee handbook or other employee documented benefits. The PMLA does not restrict the employer from requiring reasonable documentation following a leave of less than three consecutive dates, unlike the ESTA which had no standard governing.
Family Members: The PMLA reduces who is covered under a "family" and has removed "domestic partner" and any other individual related by blood who is the equivalent of a family relationship.
Rehired Employees: The PMLA changed the requirement under the ESTA and does not require employees to reinstate unused paid medical leave when an employee is rehired after employment separation.
Notices and Record-keeping: The PMLA reduced the three-year record keeping to one-year and does not require employers to provide written notice to employees on their sick leave rights. What an employer does need to do is include the display poster regarding PMLA in a conspicuous place, similar to other labor law posters.
Employers in Michigan should begin preparing to comply with the PMLA by taking action to review existing sick leave policies to implement new or revise existing ones, in order to satisfy the new law.
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