On March 24, 2011, the Wisconsin Court of Appeals upheld the Milwaukee Paid Sick Leave Ordinance (the "Ordinance"), vacating a lower court's injunction against its enforcement. As a result, employers may soon be required to offer paid sick leave to employees working within the City of Milwaukee.
What the Ordinance Requires
The Ordinance requires employers to provide all employees working within the City of Milwaukee with one hour of paid sick leave for every 30 hours of paid work within the city, up to 72 hours annually (nine days for a 40-hour workweek). Employees of small businesses (fewer than 10 employees) are entitled to accrue and use up to 40 hours of paid leave annually (five days for a 40-hour workweek). The Ordinance applies to full-time, part-time, and temporary workers, and "any person who is employed within the geographical boundaries of the City."
Accrual of paid leave time begins at the time of hire, and employees become eligible to use the leave time on the 90th calendar day of employment. When used, the paid sick leave must be paid at the employee's regular hourly rate of pay and may be used in fractions of hours rounded to the next quarter hour. Unused leave may be carried over to the following year, but the total sick leave provided in any year need not exceed 72 hours (or 40 hours for small businesses). When the employment relationship ends, employers are not obligated to pay employees for unused sick leave. However, if an employee is re-hired within one year of separation from the same employer, previously accrued sick leave is reinstated, and the 90-day waiting period for use of sick leave does not apply.
Paid sick leave can be used for the diagnosis or treatment of an employee or family member's health condition, preventive care, or care and various activities related to domestic violence, sexual assault, or stalking. A family member includes a child (biological, adopted, or foster), parent, grandparent, spouse or domestic partner, sibling, spouse of a sibling, grandchild, and "any other individual related by blood or affinity in a close relationship equivalent to a family relationship."
The Ordinance prohibits employers from requiring that an employee disclose details of a medical condition or information relating to domestic abuse, sexual assault, or stalking; requiring that an employee find a replacement employee; or imposing any unreasonable barriers or documentation requirements. The Ordinance also includes provisions prohibiting retaliation for the exercise of rights under the statute and related to employee notice of rights and record retention. Specifically, employers are required to notify employees of their rights under the ordinance in English, Hmong, and Spanish and either post the notice in a conspicuous workplace location or provide individual handouts to employees. Employers must maintain records of hours worked and paid sick leave taken by employees for at least five years. Complaints will be investigated and adjudicated by the Milwaukee Equal Rights Commission. Potential penalties include back pay, reinstatement, attorney's fees, and monetary penalties. Administrative rules implementing the Ordinance will provide some additional guidance regarding each of these requirements.
Next Steps
The Metropolitan Milwaukee Association of Commerce, who brought the legal challenge to the Ordinance, has indicated that it will ask the Court of Appeals to reconsider its ruling. After the Court of Appeals decides whether or not to reconsider its ruling, its decision may be appealed to the Wisconsin Supreme Court, which deadlocked on the matter last year and remanded the case back to the Court of Appeals for a decision on the merits. In addition, a bill pending in the Wisconsin Legislature would preempt any municipal ordinances requiring employers to provide leave above and beyond what is required by the Wisconsin Family and Medical Leave Act, effectively voiding the Ordinance. The bill passed the state Senate in early March, was introduced in the Assembly, and has been referred to the Labor and Workforce Development Committee.
In the meantime, accrual of paid sick leave will begin on the 90th calendar day following the Ordinance's implementation date. The "implementation date" is defined as "the date that the City can legally begin implementing the Ordinance," which remains unclear in light of the Court of Appeals' ruling and comments from city officials, who have indicated that the city plans to revisit its administrative rules before implementing the Ordinance.
In light of the Court of Appeals' decision, affected employers should begin reviewing their paid leave policies with legal counsel and consider changes that would need to be made to comply with the Ordinance's requirements. Employers that already have in place paid time off, sick leave, and other leave policies that provide equal, or more generous, benefits than those required by the Ordinance should not be affected. However, as the Ordinance applies equally in unionized work environments, employers and unions may need to revisit labor agreements to ensure compliance.
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