Proposed Rules for Milwaukee Sick Leave Ordinance Issued While Injunction Remains In Effect
Labor & Employment Alert 04/06/09 David B. Kern
On April 1, 2009, the City of Milwaukee's Equal Rights Commission ("ERC") adopted and released for public comment proposed administrative rules providing guidance for the implementation and enforcement of the Milwaukee paid sick leave ordinance. The Ordinance requires employers to provide up to nine days of paid sick leave per year to employees working within the geographic boundaries of the City of Milwaukee. The ERC issued the draft administrative rules notwithstanding a temporary injunction prohibiting the implementation and enforcement of the Ordinance for the duration of a pending lawsuit filed by the Milwaukee Metropolitan Association of Commerce challenging the legality of the Ordinance.
In the event the Ordinance withstands judicial scrutiny, the draft administrative rules provide guidance to employers for determining whether their leave policies and practices comply with the Ordinance. Some of the key administrative rules are as follows:
- Foreseeable Absence Notification. Employer policies or practices that require advance notification of a pre-scheduled or foreseeable absence from work for which paid sick leave will be used are presumed to comply with the Ordinance, although they may be unreasonable if the required notice is "excessive" or the method of communication is "unnecessarily burdensome." Proposed Rule 5.3.
- Unforeseeable Absence Notification. Employer policies or practices that require notification "as soon as practicable" for an unforeseeable absence from work for which paid sick leave will be used are presumed to comply with the Ordinance. An employer may define "as soon as practicable" as two hours or a time period less than two hours prior to the start of an employee's work shift, but "recognizing that there are instances such as accidents and sudden illnesses for which such a requirement is unreasonable." Proposed Rule 5.4. Requiring advance notice of an unplanned absence to an employer more than two hours before a shift is presumed to be unreasonable, unless an employer can demonstrate by clear and convincing evidence a compelling business reason for the notice requirement. Proposed Rule 5.5.
- Limits On Employee Disclosure and "Confidentiality." Despite the above proposals concerning employee notification, an employer may not require an employee to disclose information relating to domestic abuse, sexual assault or stalking or "the details of an employee's medical condition as a condition for providing leave." Proposed Rule 11.1. What comprises a detail is left undefined. As a result, an employer that asks basic information about an employee's medical condition under the federal FMLA, the Americans with Disabilities Act, and the Wisconsin Fair Employment Act as part of leave administration and/or reasonable accommodation process risks violating the Ordinance, if this proposed rule is adopted. The proposed rule also prohibits an employer with "health information or information pertaining to domestic abuse, sexual assault or stalking" from disclosing the information unless it has the employee's permission. Proposed Rule 11.2. This proposed rule appears to bar Human Resources from sharing the information with an employee's supervisor.
- Verification of Absence. Policies or practices that require a doctor's note or other medical documentation for the use of paid sick leave for three or fewer consecutive days are unreasonable and not allowed except to verify medical appointments. Proposed Rules 7.3 and 7.5. Policies or practices that require a doctor's note or other medical documentation for the use of paid sick leave for more than three consecutive work days (whether full or partial) are reasonable. Proposed Rule 7.3
- Form of Certification. The proposed rules list possible types of proof to support an absence, which are a signed document from a health care provider "affirming the general nature of illness, injury or health condition for which leave is being requested," a police report, a court order, or a signed written statement from a victim and witness advocate or a domestic violence counselor affirming the employee is involved in legal action or proceedings related to stalking, domestic violence, or sexual abuse. Proposed Rule 7.4. The choice of certification is made by the employee, not the employer, and could include other documentation.
- Managing Abuse. An employer that wants to monitor employee abuse and discipline employees for doing so may create a policy addressing those issues. A pattern of abuse may include consistent taking of paid leave without advance notice when there is no emergency requiring it, consistent taking of leave on days for which vacation or other requested leave have been denied, a pattern of taking paid leave on days where the employee is scheduled to work a shift or perform duties perceived as undesirable, including high customer volume days, or a pattern of taking paid leave on Mondays, Fridays, or the day immediately preceding or following holidays. Proposed Rule 8.1.
- Computation of Sick Pay. An exempt employee's sick pay is computed by dividing the employee's normal weekly earnings by 40 hours or the employee's "fixed number of hours per week" if the employee's "regular work week is clearly a fixed number…" Proposed Rule 9.1(a). If an exempt employee's earnings vary per week, the employer must do the computation over the prior four weeks (i.e., total earnings over the prior four weeks divided by the total hours over the four weeks). A non-exempt employee's hourly rate for sick pay must be based on the same rules as required by the Fair Labor Standards Act to determine a non-exempt employee's regular rate of pay. Proposed Rule 9.1(b). Earnings include all compensation received for services such as nondiscretionary bonuses and commissions, but excludes discretionary bonuses, payments for periods when no work is performed (e.g., vacation pay and sick pay), gifts, profit-sharing, savings plan contributions made by the employer, reimbursement for expenses, certain premium payments, and similar payments under the Fair Labor Standards Act. Proposed Rule 9.1(a). If other forms of compensation cannot be determined when an employee takes paid sick leave, the effect of such payments on an employee's hourly wage must be determined "as soon as practicable" when "the amount of such payments becomes known and the employee's paid sick leave compensation rate shall be retroactively adjusted to reflect the new, higher 'hourly rate.'" Proposed Rule 9.1(a).
- Alternative and Limited Milwaukee Work Schedules. All employees who perform work in the City of Milwaukee, including on a part-time or temporary basis, accrue paid sick leave for those hours worked in the City, regardless of where their employers are located. Proposed Rule 15.1. Employees who live in Milwaukee and perform work for an employer from home, including telecommuting, are covered by the Ordinance for all hours that they perform work from home, assuming the employee performs 90 or more hours of work in Milwaukee within a calendar year. Proposed Rule 15.2. Employees who work outside of Milwaukee and who travel through Milwaukee, but do not stop in the City in their work are not covered by the Ordinance. Proposed Rule 15.3. Employees who travel through Milwaukee, and stop in Milwaukee as a purpose of their work (for example, to make pickups or deliveries), are covered by the Ordinance for all hours worked in the City, including travel within the City to and from the work site, provided the employee performs 90 or more hours of work in Milwaukee within a calendar year. Proposed Rule 15.3.
- Reinstatement of Former Employee's Sick Hours. The proposed rules require an employer to reinstate a former employee's earned sick leave hours if the employee is re-hired within one year from separation from employment. Proposed Rule 16.1. The employee may immediately use the reinstated sick hours if he or she previously worked for the company for at least 90 calendar days before being separated. If an employee did not have at least 90 calendar days of service in his or her prior employment with the company, the employee may use the reinstated sick days when combined service under the prior employment and current employment with the company equals at least 90 days. Proposed Rule 16.2.
- Other Paid Leave Policies. The proposed rules provide that any leave policy that provides for greater accrual or use by employees of sick leave or that extends other protections to employees counts as sick leave under the Ordinance. Proposed Rule 20.1.
- Less Generous Provisions and Union Contracts. The proposed rules provide that the Ordinance does not take the place of any other law or policy that allows employees to earn more sick leave than the Ordinance provides. Proposed Rule 21.1. They also provide the Ordinance does not limit an employer's obligations under any union contract, benefit plan or other agreement that is more generous to employees than the Ordinance. The proposed rules do not address the conflict that arises when the Ordinance requires more sick leave than negotiated in a union contract. Proposed Rule 21.2.
The proposed rules provide no relief to employers hoping for some shortcuts from the Ordinance's requirement that employers retain records documenting hours worked by employees and paid sick leave taken by employees for a period of five years from creation of the record. Proposed Rule 10.1. The proposed rules provide that if an employer has multiple locations and it does not allow an employee to use the paid sick leave outside of the employee's work location in Milwaukee, the sick hours remain available to the employee for five years from the employee's last day of work in Milwaukee. Proposed Rule 19.2. This proposed rule requires employers to retain records for five years after an employee no longer works in the City. In addition, the proposed rules provide that employees begin to accrue paid sick leave on the implementation date that falls at least 90 days after employment began.
The ERC has established a comment period from April 2 to April 24, 2009 to permit employers, employees, and other interested parties the opportunity to provide feedback on the draft administrative rules prior to their final adoption. Comments, questions and concerns about the proposed rules should be e-mailed to email@example.com or mailed to the Equal Rights Commission, Department of Employee Relations, 200 E. Wells Street, Room 706 - City Hall, Milwaukee, WI 53202.
In association with the comment period, public hearings regarding the draft administrative rules will be held on April 8 and April 22.
Oral arguments to determine the legality of the paid sick leave Ordinance are scheduled for May 11, 2009 in the Circuit Court for Milwaukee County. It is likely that the Circuit Court's decision will be appealed to the Wisconsin state appellate courts.
Recommendations for Employers
Although the injunction remains in effect and there is a near certainty that the loser in the lawsuit will appeal the decision, employers should familiarize themselves with the proposed regulations and compare them to their own policies and practices. There any many unanswered questions under the Ordinance and practical problems presented by the proposed regulations. Any employer that disagrees with any of the proposed regulations should communicate its opinion to the City. Quarles & Brady would be happy to provide comments to the City on behalf of any client or discuss issues that remain unresolved with the proposed regulations with any client that is interested in providing comments to the City. If and when the Ordinance goes into effect, it will be too late for employers to make any changes to the regulations.
Keep in mind that employers are not obligated to do anything. The injunction remains in effect until at least May 11, 2009. Furthermore, these proposed rules need to be finalized before they must be followed.
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If you have any questions regarding the Ordinance or the draft administrative rules, please contact C. Ann Martin at 414-277-3073 / firstname.lastname@example.org, Pam Ploor at 414-277-5661 / email@example.com, Dave Kern at 414-277-5653 / firstname.lastname@example.org or your Quarles & Brady attorney.