For businesses with existing paid sick leave or vacation / paid time off (PTO) policies that comply with the Act's requirements, it may not be necessary to create a new paid sick leave policy. Nonetheless, it is important to be aware of your obligations under the Act, including: 

  1. Existing PTO policies that require forfeiture of unused PTO year-end or delay accrual of PTO until 60 or 90 days post-hire are not compliant with all of the Act's requirements.
  2. For employers with 15 or more Arizona employees, employees accrue a minimum of one hour of earned paid sick time for every 30 hours worked, but employees are not entitled to accrue or use more than 40 hours of earned paid sick time per year.
  3. For employers with fewer than 15 Arizona employees, employees must accrue a minimum of one hour of earned paid sick time for every 30 hours worked, but they are not entitled to accrue or use more than 24 hours of earned paid sick time per year. Employers may choose how to determine the beginning of the benefit year (calendar, anniversary, etc.).
  4. To avoid the burden of accrual and carry-over, employers may "front-load" sick leave to employees by providing the maximum leave amount on the first day of the benefit year.
  5. Employers are not required to pay an employee for accrued and unused paid sick leave upon separation of employment.
  6. Employers must post the new "Earned Paid Sick Time" notice, which can be found by clicking here.
  7. Potential damages available for violations of the Act include all unpaid wages with interest and exemplary damages of two times the amount of unpaid wages. Additionally, employers who retaliate against an employee for taking or requesting paid sick leave are subject to a penalty of no less than $150 per day that violations continue.  

Arizona is the most recent state to roll out a paid sick leave law. Other jurisdictions with sick leave laws that may apply to your business include: 

  • California and Cities of Berkeley, Emeryville, Oakland, Long Beach, Los    Angeles, San Francisco, San Diego and Santa Monica
  • City of Chicago and Cook County, Illinois (note that several municipalities have opted out of the Cook County ordinance)
  • Connecticut
  • District of Columbia
  • Massachusetts
  • City of Milwaukee, Wisconsin
  • Cities of Minneapolis and St. Paul, Minnesota
  • Montgomery County, Maryland
  • New Jersey cities of Bloomfield, East Orange, Elizabeth, Irvington, Jersey City, Montclair, Newark, New Brunswick, Passaic, Patterson, Plainfield and Trenton
  • New York City, New York
  • Oregon and City of Portland
  • Cities of Philadelphia and Pittsburgh, Pennsylvania
  • Vermont
  • Washington State and Cities of Seattle, Spokane and Tacoma 

These divergent laws can create headaches for Human Resources, especially for those businesses that employ workers across state lines from the company's primary location or that maintain employees who travel to different cities and states. 

Ensuring compliance with paid sick leave laws at the state and local level can be a challenge and may necessitate consultation with legal counsel. 

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