Mandatory Paid Sick Leave Breaking Through the Quagmire and Quandary of Compliance in 2025

Overview:

Mandatory paid sick leave is no longer a trend—it’s becoming a nationwide standard, creating significant compliance challenges for businesses of all sizes. As of today, 21 states and the District of Columbia require employers to provide paid sick leave to their employees. Additionally, 27 municipalities have enacted their own paid sick leave mandates, adding another layer of complexity for multi-state and multi-location employers.

The landscape is continuously evolving, with more states considering legislation to expand these mandates. Alaska, Missouri, and Nebraska recently passed mandatory paid sick leave laws through the November 2024 election process, and these laws went into effect on January 1, 2024. Meanwhile, California increased its minimum sick leave requirement from 24 hours to 40 hours per year, and Connecticut reduced the minimum number of employees covered under its law from 50 to 25, effective January 1, 2025. Adding to the legal shifts, the Michigan Supreme Court issued a ruling on July 31, 2024, impacting sick leave compliance requirements, and Alaska has another referendum set for November 2024 to expand paid sick leave statewide—a measure that is expected to pass.

For employers, this means an urgent need to reassess existing time-off policies, align with state-specific requirements, and prepare for additional legislative changes in the near future.

Do You Have a Federal or Municipal Contract? Compliance May Already Be Required:

Beyond state and local mandates, employers engaged in federal contracts are legally required to provide paid sick leave to their employees. But many businesses fail to recognize that municipal contracts may also impose paid sick leave requirements.

• Have you reviewed the fine print in your municipal contracts? Some agreements require paid sick leave—even if state laws do not.
• Are you aware of potential financial risks and legal consequences for non-compliance? Violating these contracts could lead to penalties, lost contracts, or exclusion from future bidding opportunities.

Every Law is Different: The Compliance Struggle

One of the most challenging aspects of mandatory paid sick leave laws is that no two laws are exactly alike. Employers managing a workforce across multiple jurisdictions must contend with inconsistent requirements, including:

• Vermont mandates paid sick leave eligibility after one year of service, while other states set the threshold at 90 or 120 days.
• New York and Colorado require real-time accrual and payout of sick leave, making tracking and administration more complex.
• Many laws extend sick leave benefits to part-time and on-call employees, further complicating compliance efforts.

Employers must carefully evaluate their policies to ensure compliance across various locations while minimizing administrative burdens and potential legal risks.

Is Your PTO Plan Still the Right Choice?

For years, businesses consolidated vacation and sick leave into Paid Time Off (PTO) plans, allowing employees to manage their time off more flexibly. However, the growing number of paid sick leave laws is forcing many employers to rethink this approach.

• Why? Many states require unused PTO to be paid out at termination, while unused sick leave is exempt from payout requirements.
• This discrepancy means businesses risk higher financial liabilities if PTO plans remain unchanged.
• Some organizations are now shifting back to separate Sick/Vacation policies to mitigate these risks.

The question for employers is: Should you maintain your PTO policy despite the added costs, or is transitioning to a separate Sick/Vacation structure the better option?

With more legislative changes on the horizon, businesses must take a proactive approach to compliance. Organizations that fail to stay ahead of evolving sick leave laws risk costly penalties, legal disputes, and disruptions to workforce management.

This webinar will provide actionable insights on compliance strategies, policy adaptation, and best practices for managing sick leave effectively.

Areas covered in the session:

• Current Mandatory Paid Sick Leave Laws in place.
• A review of pending legislation.
• A review of the different Mandatory Paid Sick Leave Requirements
• Examples of the Quandary of Compliance
• A comparison of PTO policies vs. Sick/Vacation
• Conducting a cost-benefit analysis for both plans
• Planning for change
• Communication the change
• Action Items for participants

Why should you attend?

Keeping up with mandatory paid sick leave laws is becoming increasingly complex as more states and municipalities enact their own regulations. With Alaska, Missouri, and Nebraska recently passing new laws and California and Connecticut making key changes, understanding these evolving requirements is essential to ensure your organization remains compliant and avoids legal risks. This session will provide a detailed review of the latest laws and pending legislation, helping you stay ahead of new mandates.

Many employers are re-evaluating their Paid Time Off (PTO) policies as new sick leave laws create financial and administrative challenges. Since some states require payout of unused PTO at termination but not unused sick leave, businesses must decide whether maintaining a combined PTO model or transitioning back to separate Sick/Vacation policies is the better option. This webinar will explore the pros and cons of both approaches and what employers should consider when updating their policies.

With each state and municipality enforcing different sick leave rules, compliance can be confusing—especially for multi-state employers. Some states allow sick leave to accrue annually, while others require real-time accrual and payout. This webinar will clarify the key compliance challenges businesses face and provide insights into how these variations impact policy design and administration.

Who will benefit?

This session is essential for professionals responsible for managing compliance, payroll, and HR policies related to paid sick leave, ensuring they stay updated on evolving regulations. Those who will benefit include:

• HR Managers and Directors
• Payroll Professionals
• Compliance Officers
• Business Owners and Executives
• Employee Relations Specialists
• Legal and Risk Management Teams
• Operations and Benefits Administrators