New Compliance Check Introduced

The New York City Department of Consumer and Worker Protection (DCWP) has implemented a new compliance check for the city's paid time off law. The agency will flag businesses where fewer than 50% of employees have used any paid time off in the past year, indicating potential "systemic" violations. DCWP policy director Elizabeth Wagoner stated that the benchmark is adjustable based on industry and company size.

This 50% benchmark is derived from national data by the U.S. Centers for Disease Control and Prevention, which shows that half of private sector employees with paid sick leave miss at least one work day annually due to illness, injury, or disability. The DCWP will also continue to investigate violations based on worker complaints.

Background on Protected Time Off Law

The new payroll tracking is part of the city's effort to establish clearer compliance rules for its paid time off law, which includes a new tool for employers to ensure adherence. Since 2014, most New York employees have been entitled to time off for illness, injury, or urgent personal business.

Approximately 3 million New Yorkers are covered by the Protected Time Off Law, which provides private-sector workers with a minimum of 32 hours of unpaid time off and 40 hours of paid time off annually.

Employer Compliance and Challenges

Wagoner stated that the goal is to provide clarity for all parties, including judges and employers, adding that low sick time usage rates signal a compliance issue requiring correction. The agency's report noted that some employers attribute low time-off usage to workers not wanting the benefit. However, the agency found that some workers encounter illegal barriers despite benefits being offered.

Prohibited practices include:

• Workers not receiving adequate notice of their rights.
• Managers discouraging time off use.
• Workers being told they must find shift replacements.

The city initiated its analysis of paid time off compliance approximately a year ago, using employer payroll records to identify potential violations. The findings led to the changes implemented.

Expert Commentary

Experts described the new approach as a common-sense measure that enhances transparency. Terri Gerstein, director of NYU Wagner Labor Initiative, commented that a company with fewer than half of its employees taking a day off indicates workers may not be utilizing sick leave.

Gerstein considered it a "smart approach" providing a rigorous data basis.

Gerstein and other experts suggest the agency's approach is conservative, a point acknowledged in the agency's report. Daniel Schneider, a Harvard Kennedy School sociologist, noted that the city's protected time off law covers various incidents beyond health, such as childcare and housing court appearances, which are not included in national data.

New Tools and Penalties

The DCWP is also introducing a self-auditing tool for employers to check compliance with the law, including the new usage benchmarks. The tool will provide compliance recommendations, and the data will not be shared with the agency, according to Wagoner. Gerstein expressed hope that the new rules could foster greater collaboration and cooperation from employers, stating that employers often seek clear guidance, and these rules serve that purpose.

Employers failing to provide protected time off face penalties of at least $500 per affected employee per year, plus an equivalent civil penalty. For example, an employer with 100 employees violating the law for three years would owe $300,000, with half allocated to employees and the remainder as a civil penalty. Employees may receive additional compensation in retaliation cases.