Tacoma Paid Leave 2016: Implementation options available to employers

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Tacoma Paid Leave 2016: Implementation options available to employers

Tacoma(September 16, 2015) The Paid Leave Ordinance approved by the Tacoma City Council on January 27, 2015, goes into effect on February 1 of 2016.  The ordinance ensures that everyone working in Tacoma can earn Paid Leave to use when they need temporary time off from work to take care of issues related to their own health or the health of a family member. Under the ordinance employees may  use paid leave to take care of their own needs, or their family’s needs, resulting from domestic violence, sexual harassment, assault or stalking.

The paid leave ordinance applies to all employees working within the boundaries of Tacoma.  Employees will start earning paid leave 180 days after becoming employed: 1 hour for every 40 hours worked, up to 24 hours a year.  At the end of the year, up to 24 hours of unused paid leave can be rolled over to the next year, but use of paid leave is limited to 40 hours in that year.

 

Options for Compliance

The paid leave ordinance provides employers with option on how to meet the law’s requirements. These have different implications in terms of cost and administration. Your options are to:

  • Option 1: Establish a program to provide employees with paid leave available under the Ordinance.  This option requires you to track, and maintain records of, each employee’s time worked in Tacoma, accrual of paid leave, and use of paid leave.  You must also provide regular notice to each employee of their accrued, used, and unused paid leave.  There are various other requirements set forth in the Ordinance and Rules as well.
  • Option 2: Establish a Universal PTO Policy that combines all types of paid leave available to employees (e.g., paid vacation, paid sick leave, Paid Leave per the Ordinance).  Employers who choose this option must still comply with all of the components of the Ordinance.  While combining all types of leave into a Universal PTO policy may be more streamlined than trying to track each type of leave separately, having a Universal PTO policy will still require tracking accrual and use of Paid Leave, record-keeping, and providing regular notice to employees of their use of Paid Leave.
  • Option 3: Establish a Premium Pay Program under which employees who are included in the Program are paid a higher amount of pay for time worked in Tacoma, instead of providing them Paid Leave under the Ordinance.

Establishing a Premium Pay Program may be more attractive than the other two options.  While the Premium Pay will cost more in terms of wages paid, such increased wages should be relatively modest, and such a Program is likely to be substantially less burdensome from an administrative standpoint.  For example, it will relieve you of the obligation to track accrual versus use of Paid Leave per employee paid Premium Pay.  At the very least, due to some challenges in having the Paid Leave program apply to employees who are exempt from overtime, you may consider having those employees on a Premium Pay program in lieu of providing them with Paid Leave.  Applications for Premium Pay Program proposals must be submitted for review at least 90 days in advance of the intended start date.  We recommend submitting your proposals before November 1st. Click here for the online application.

We’ll cover the finer points of these options and provide some example policies in future posts.  Until then, feel free to call us if you have any questions: (360) 956-7279.