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A First in the Lone Star State — Austin Mandates Paid Sick Leave

Austin recently became the first Texas city to join San Francisco, Los Angeles, New York City, Chicago, and Washington D.C., among over two dozen other cities and several states (including, most recently, Maryland), in requiring employers to provide paid sick leave.

On February 15, the Austin City Council approved a new rule requiring employers to provide paid sick leave to their employees. The ordinance applies to all private employers operating in the city, regardless of whether they may be based elsewhere or whether an employee lives outside the city. The rule takes effect on October 1, 2018.

An employee must earn a minimum of one hour of sick time for every 30 hours worked.  Mandated sick leave is capped at 64 hours (or eight 8-hour days) per year for employers with more than 15 employees, and 48 hours (six 8-hour days) for those with less than 15 employees. Employers with less than 5 employees have until October 2020 to comply. Employers who already provide more generous benefits will not be affected by the ordinance.

The Texas Legislature may have something to say about how long Austin employees’ paid sick leave will last. Already at least one legislator from the area has promised that the state legislature will act to undo the Austin rule, much as it undid Austin’s ride-sharing ordinance last session. About fifteen states have already acted to prohibit local jurisdictions from enacting paid leave mandates.

The patchwork of city and state laws addressing paid sick leave may be causing headaches for multistate employers, who must pay attention to state and local requirements wherever they operate. Employers with existing paid leave or paid time off (PTO) programs should confirm they satisfy specific requirements, including notice, in each jurisdiction.

Austin’s action serves as a wake-up call for Texas employers who thought they were immune to laws that are commonly viewed as “pro-employee” and associated with blue states like California. Only time will tell if the Texas Legislature has also heard the alarm.

This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.