Employment Law

February 2017

Arizona Employers: Paid Sick Leave Requirement Goes into Effect July 1

All employers are subject to a new law that provides for a minimum accrual of one hour of paid sick leave for every 30 hours worked, up to the statutory limits.

Denis Fitzgibbons

When Arizona voters passed Proposition 206 last November, much of the attention was focused on increasing the state’s minimum wage to $10 per hour. However, of greater concern to many employers is Prop. 206’s other provision: mandatory paid sick leave.

Effective July 1, employees of small employers (under 15 employees, including part-time and temporary workers) are eligible for 24 hours of sick leave per year; at larger employers, the requirement is 40 hours.

All employers are subject to the new law (A.R.S. § 23-372), which provides for a minimum accrual of one hour of leave for every 30 hours worked, up to the limits noted above. Accrual starts with the first day of employment or July 1, 2017, whichever is later. Employers can have policies restricting employees from using leave within the first 90 days of employment.

If an employer is already providing enough paid time off to cover the minimum amount of paid sick time, and if the employer allows its workers to use that time off in the same way and for the same purposes as paid sick leave, then the employer does not need to provide additional paid sick time.

Employees are allowed to use their accrued paid sick leave for their own illness and for the illnesses of family members. At the end of a year, any unused paid sick leave carries over to the next year, unless the employer chooses to pay them for their unused sick time. (Any unused leave does not need to be paid out when the employee resigns or is terminated.)

Employers that want to require employees to provide notice prior to taking foreseeable leave must have a written policy that spells out how the notice is to be given.

Employers may not retaliate against employees for using or requesting paid sick leave. The new provides that, if any discipline occurs to an employee within 90 days of them taking sick leave, there is a presumption that the discipline is retaliatory.

Failure to Comply. The first violation carries a minimum $250 fine; for each subsequent violation, the fine is a minimum $1,000. Also, non-compliant employers must pay the employee the unpaid balance of the earned paid sick leave owed, plus interest, plus an additional amount equal to twice the unpaid sick leave.

Employers should begin to prepare for the July 1 effective date by ensuring that employee handbooks and policies are consistent with the new law and that their payroll systems are able to track the accrual and payment of sick leave.

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