Last year, we reported that Governor Hogan had vetoed legislation that would have required most employers in Maryland to provide paid sick leave.  In one of its first actions in 2018, the General Assembly overrode the Governor’s veto of House Bill 1 (the “Act”) on January 12, 2018.  The law will now will go into effect on February 11, 2018, per legislative guidelines.  While the Maryland Chamber of Commerce and others plan to seek an extension of the time for implementation, employers in Maryland must quickly prepare to provide paid sick leave to their employees.

Who is covered?

All Maryland employers are covered by the Act.  Employers with fewer than 15 employees will need to provide only unpaid leave, while employers with 15 or more employees will be required to provide paid leave. An employer must determine its level of coverage by calculating the average monthly number of all employees (including full-time, part-time, temporary, and seasonal) employed during the immediately preceding 12 months.

Almost all employees are covered by the Act.  Exceptions include:  employees who work fewer than 12 hours a week for an employer; construction workers covered by collective bargaining; health care workers who provide services on an “as-needed” basis; licensed real estate salespersons and brokers; employees of temporary staffing agencies, if the agency does not have day-to-day control over their work assignments; and employment agency employees providing part-time or temporary services to another person.

How much leave must be provided?

Employers must permit employees to accrue one hour of leave for every 30 hours worked (leave must be paid if the employer has 15 or more employees).  Employers may cap the amount of leave earned each year at 40 hours.  Unused leave may be carried over from year-to-year, but no more than 40 hours may be carried over each year and employers may cap the total amount of accrued leave at 64 hours.  Employers may also limit the amount of leave that may be used each year at 64 hours.  Employers who do not wish to accrue and carry over leave may “front load” leave by awarding it on the first day of the year.

What can leave be used for?

Employees may use leave for the following reasons:

• To care for or treat the employee’s own mental or physical illness, injury, or condition;
• To obtain preventive medical care for the employee or family member;
• To care for a family member’s mental or physical illness, injury, or condition;
• For maternity or paternity leave; and
• For absences due to domestic violence, sexual assault, or stalking during the employee’s relocation or to obtain for the employee or family member medical or mental health attention, services from a victim services organization, or legal services

“Family member” is defined very broadly, to include a spouse, child, parent, grandparent, grandchild or sibling.  In all cases, the relationship may be biological, foster, adopted or step, and parents include in-laws and those who stand in loco parentis.

What else do I need to know?

Employees may be required to give up to seven days’ notice for leave that is foreseeable.  For leave that is not foreseeable, the employee must give notice as soon as practicable and must comply with the employer’s notice for absences.  An employer may request verification of the appropriate use of leave if the employee uses more than two consecutive scheduled shifts.

Employers must provide notice to employees of their rights under the Act.  Each time wages are paid, the employer must provide a written statement of available leave.  Employers must also post a notice advising employees of rights under the Act through a workplace poster.  The DLLR is expected to create a model poster for employers, and also may create a model policy.  The Governor announced the creation of a State Office of Small Business Regulatory Assistance to aid small businesses in complying with the mandate, which may provide compliance resources once established.

Employers may continue to use an existing leave policy, so long as that policy meets the minimum accrual and usage requirements of the law.  The existing leave may include vacation, sick, short-term disability, floating holidays, parental leave, or any other paid time off that may be used for leave purposes.

What do I need to do now?

Employers must quickly review and possibly modify existing leave policies or implement paid leave in accordance with the Act.  While many employers already provide more generous leave benefits than required by the Act, modifications may need to be made to accrual rates, caps and carryover to comply with the new law.  Employers may also need to examine their payroll reporting systems to ensure they can report on available leave balances with each paycheck.

Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.

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