Locke Lord QuickStudy: City of Dallas Provides Guidance on Paid Sick Time Ordinance Set to Take Effect August 1

Employers will soon be required to provide paid sick time to employees who perform at least 80 hours of work per year within the City of Dallas. Dallas’s paid sick time ordinance (the “Ordinance”) is set to go into effect for employers with more than five employees (at any time within the preceding 12 months) on August 1, 2019. Employers with five or less employees have until August 1, 2021, to comply with the Ordinance.

The City of Dallas recently held two informational sessions aimed to provide the public with guidance on the Ordinance’s requirements. During the sessions, Dallas business owners raised many concerns and questions, revealing uncertainty by employers and City officials alike as to how the City will enforce the Ordinance. Officials stated the City is in the process of preparing administrative rules that they hope will answer many of the questions, including:

1. Must employers track the hours of exempt employees to comply with the Ordinance?
2. What constitutes retaliation?
3. What can employers do to curb abuse of the Ordinance by employees (particularly in light of the verification restrictions)?
4. How will the Ordinance affect employees who travel to Dallas to work?
5. How does the Ordinance affect temporary staffing agencies and professional employer organizations?
6. What constitutes a “more generous” leave policy such that the employer need not revise its policy to comply with the Ordinance?

The City expects to publish the administrative rules and other resources to the City’s website within the next week.

In the meantime, employers should familiarize themselves with the Ordinance and analyze whether their leave policies meet the (1) purpose, (2) accrual, (3) yearly cap, and (4) usage requirements of the Ordinance. Employers with leave policies that meet such requirements need not provide any additional benefit (other than the postings and notifications discussed below), while employers with policies that do not meet the requirements should revise their policies accordingly.

The following is an overview of the Ordinance’s requirements based on its text and the limited guidance provided at the informational sessions.

Who is covered?

The Ordinance covers all employees (whether full-time, part-time, hourly, or salaried) and paid interns who work for a private employer in Dallas for at least 80 hours in one year. The Ordinance does not apply to unpaid interns or independent contractors. It is unclear at this point how the Ordinance will apply to an employee who works in Dallas on a business trip or passes through Dallas as part of their work duties (e.g., delivery drivers).

What rights does the Ordinance provide?

The Ordinance requires employers to grant covered employees 1 hour of paid sick time for every 30 hours worked in Dallas. Paid sick time must begin accruing at the start of employment (or as of the effective date of the Ordinance), and generally must be available for use as soon as it is accrued and the employee has worked 80 hours. Paid sick time must be paid at the employee’s normal rate of pay (excluding overtime, tips, and commissions).

Paid sick time must accrue up to a minimum yearly cap: 64 hours per year for employers with more than 15 employees and 48 hours per year for smaller employers. For purposes of the yearly cap, an employer may use any 12-consecutive month period rather than a calendar year, so long as it provides written notice of such policy. All available paid sick time up to the cap must carry over into the following year unless the employer chooses to front load the entire yearly allotment of paid sick time at the beginning of each year.

Employees may use paid sick time for the following purposes:

• Personal illness, injury, or preventive care;
• To care for a family member’s injury or illness, or preventive care; and
• To seek medical attention, relocate, obtain victim services, or participate in legal action related to domestic abuse, sexual assault, or stalking of the employee or their family member.

The Ordinance prohibits retaliation against employees who request or use paid sick time, report violations, participate in investigations, or otherwise exercise rights under the Ordinance.

Lastly, the Ordinance requires employers to provide statements showing the amount of paid sick time each employee has available, post signs describing the Ordinance (available here), and include notice of the Ordinance in any employee handbook.

What are the rules for using paid sick time?
Employees may use paid sick time by making a timely request before their scheduled work time. Employers cannot prevent an employee from using accrued, paid sick time for an unforeseen absence that meets the requirements of the Ordinance or require employees to find a replacement for their shift.

Employers may require verification of the employee’s proper use of paid sick time, but only when an employee requests paid sick time for more than 3 consecutive days. Employers may not, however, inquire about the nature of the illness or victimization.

Employees who are re-hired within 6 months of termination may use any paid sick time that was available to them at the time of termination.

What are the penalties for non-compliance?

Employees may file complaints with the City of Dallas alleging violations of the Ordinance within 2 years of the alleged violation. The City will conduct an investigation and may assess civil fines of up to $500 per violation if the employer fails to cure it within 10 days. The Ordinance does not provide a private cause of action. The City will not assess penalties for violations other than retaliation that occur before April 1, 2020.

Despite the grace period, employers should ensure their compliance with the Ordinance and the City’s forthcoming administrative rules by the effective date.