On August 5, 2015 the New York Times reported that President Obama drafted an executive order that would require companies that contract with the Federal Government to issue paid leave to their employees. The order, if adopted in substantially similar form to the draft leaked by the Times, could potentially impact hundreds of thousands of workers because it would apply to federal contractors and subcontractors. 

Accrual, Carryover and Use

The executive order, labeled “Pre-decisional and Deliberative” would require covered employees to earn sick leave at a rate of 1 hour earned for every 30 hours worked, with a minimum of 56 hours per year (about seven days). Under the draft order, all unused sick time would be carried over to the following year, but would not need to be paid out upon separation from employment. 

Under the policy, a covered employee could use accrued paid sick leave for: 

(i) a physical or mental illness, injury, or medical condition; 

(ii) obtaining diagnosis, care, or preventative care from a health care provider; 

(iii) caring for a child, a parent, a spouse, a domestic partner, or any other individual related by blood or affinity, whose association with the employee is the equivalent of a family relationship who has any of the conditions or needs for diagnosis, care, or preventative care described in paragraphs (i) or (ii); or 

(iv) an absence resulting from domestic violence, sexual assault, or stalking, if the time absent from work is to seek medical attention, obtain counseling, seek relocation, seek assistance from a victim services organization, or take related legal action, including preparation for or participation in any related civil or criminal proceeding. 

Applicability

The requirements of the proposed sick leave policy would apply to new federal contracts covered by the Davis-Bacon Act, Service Contract Act, federal concessions contracts, and certain contracts entered into with the Federal Government in connection with federal property or lands and related to offering services for federal employees, their dependents, or the general public entered into on or after January 1, 2017. The proposed order also applies to the subcontractors of contractors entering into the above contracts. 

Key Takeaways

As of July 1 of this year, California employers are required to provide a minimum of three days or 24 hours of sick leave to their employees. If the proposed executive order is adopted, however, employers in California that even occasionally enter into federal contracts will need to re-access their current policies and payroll practices to conform to the order. 

Gary E. Scalabrini, Esq. 
Gibbs Giden Locher Turner Senet & Wittbrodt LLP 
1880 Century Park East 12th Floor
Los Angeles, CA 90067
email: gscalabrini@gibbsgiden.com

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