FAQs For Contractors
Effective: January 1, 2018
In the fall of 2016, Washington State voters approved, by initiative, a new law that requires employers to provide paid sick leave to employees beginning January 1, 2018. The Oregon-Columbia AGC has prepared the following FAQ for our members to answer some of the industry specific questions that we are hearing from our members. For more information on the general provisions of the law, for definitions of terms and for sample policies, we encourage you to visit the L&I website.
Does this law apply to me?
Yes! This law applies to every employer in Washington State or that is subject to the minimum wage law. This includes contractors and those covered by collective bargaining agreements. Additionally, there are no exemptions based on the size of company or number of employees. This law applies to everyone!
How much can employees accrue?
Most employees must accrue paid sick leave at a minimum rate of one hour of paid sick leave for every 40 hours worked. This includes part-time and seasonal workers. Employees are entitled to use accrued paid sick leave beginning on the 90th calendar day after the start of their employment. This applies to new hires only – beginning January 1, any employee that has worked for you at least 90 days in the last 12 months is eligible to use their sick leave once it has accrued. Unused paid sick leave of 40 hours or less must be carried over to the following year.
Is there a cap on how many hours can be accrued?
No. Employees accrue paid sick leave for all hours worked. An employer may not cap an employee’s accrual.
How much do I have to pay employees when they are on leave and does that include benefit contributions?
Paid sick leave must be paid to employees at their normal hourly compensation. Another way to look at it – what would they have been paid had they been at work? This does not include usual benefits – such as health or pension contributions. On a prevailing wage project, this means the hourly wage portion only. However, you may not exclude payroll deductions, such as vacation banks.
Do I have to pay overtime if the employee utilizes sick time for an overtime shift?
No, the law specifically says that you do not have to pay overtime or premium rates. However, if an employee is scheduled to work a shift with a differential pay schedule, such as night shift, that rate must be included for utilized sick time. Also, for contractors under a collective bargaining agreement that calls for overtime rate on Sundays, that is considered a shift differential and not standard overtime. Overtime is defined as any hours worked over 40 hrs in a week.
What can employees use the leave for?
Employees may use paid sick leave:
- To care for themselves or their family members.
- When the employees’ workplace or their child’s school or place of care has been closed by a public official for any health-related reason.
- For absences that qualify for leave under the state’s Domestic Violence Leave Act.
- Employers may allow employees to use paid sick leave for additional purposes.
In what blocks of time can an employee take paid sick leave?
Unless subject to a variance*, employers must allow employees to use paid sick leave in increments consistent with their payroll system and practices.
For example, if the system and practice of the employer is to track increments of work in 15-minute increments, then an employer must allow employees to use paid sick leave in 15-minute increments.
Many times, this is just not feasible on construction job sites. Therefore, L&I has made a provision to allow for a variance to this rule. Each company must apply for this variance individually.
*For more information on variances, see WAC 296-128-640.
Can I require verification for use of paid sick leave?
Employers may require verification for use of paid sick leave after 3 days if you have the appropriate policy in place. For a sample verification policy, visit the L&I website.
Do I have to pay out any unused sick time at the end of the year?
Employers are not required to pay out any unused sick leave at the end of the fiscal year. However, the law does require that employees carry over any unused balance, up to 40 hours*, to the following year. Employers may define their fiscal year for carry over purposes.
*An employer may elect to provide employees with a more generous carryover.
Do I have to pay out any unused sick time when an employee leaves employment?
No, you are not required to pay it out*. However, should you rehire that same individual within twelve (12) months of their separation, you are required to re-instate their sick bank with the number of accrued hours they had at the time of their separation.
*An employer can choose to pay out any unused hours at separation, and would not need to re-instate any unused hours upon rehire.
I am signatory to a collective bargaining agreement, does this cover me?
No. As of now, the only unions that have bargained in a paid sick leave policy are the Iron workers and the Heat & Frost Insulators. All other trades are currently in discussions regarding this issue. Employers will need to ensure that beginning Jan 1, they are following all provisions of this law for all of their employees that qualify, regardless of their union status. Additionally, it is important to remember that even with a policy in place under a collective bargaining agreement, employers are not relieved of their responsibility under this law, you are still ultimately responsible to ensure that your employees receive the benefit accrued.
Will this be reported on Certified Payroll?
This question is still unanswered by L&I. Paid sick leave is considered a right, not a benefit, and therefore will most likely not be broken out on certified payroll as it will not be considered a usual benefit under prevailing wage.
I am an Oregon Contractor that does work in Washington, am I subject to this law for the hours worked in Washington?
This is another question that L&I is trying to find the answer for. Right now, the default answer is that if you are subject to Washington State minimum wage laws, you are subject to paid sick leave. We have asked the Department to address this issue and offer guidance as soon as possible as it will be critical information as projects are bid for next year. Additionally, we are asking for clarification on enforcement for out of state contractors performing work in Washington State.
Do I have to pay workers comp premiums on employees while they are using paid sick leave?
When an hourly employee is using their sick leave or annual leave, those hours do not get reported as “hours worked” and are not subject to workers comp premiums.
What is the minimum amount of sick leave that may be utilized by an employee?
The law states that employees must be able to use sick leave in accordance with your regular payroll procedures, up to one hour. That means, if you are able to pay an individual in 15 minute increments, you must allow them to use sick leave in 15 minute increments.
For More Information:
Please join AGC to welcome Eva Coblentz, Paid Sick Leave Outreach Specialist with Washington L&I, for a presentation/Q&A session regarding the Washington State Paid Sick Leave Law which went into effect on January 1, 2018.
Eva will be covering the changes that occurred with the passage of I-433 in November of 2016 and then opening the session for Q&A. Those changes include:
- Increasing the state minimum wage over the next several years
- Requiring employers to provide paid sick leave to employees beginning 1-1-2018
- Protecting employees from retaliation for the lawful use of any right set forth under the Minimum Wage Requirements and Labor Standards (RCW 49.46), including paid sick leave
Eva will be onsite at the AGC Offices in Wilsonville on Monday, February 5th and will be offering two different (but identical) opportunities to learn more about the new law. Please RSVP to Suzi Schwabe for one of the following sessions:
Monday February 5th 9am-11am AGC – Wilsonville Board Room
Monday February 5th 2pm-14pm AGC – Wilsonville Board Room