How to Navigate Paid Sick Leave as a Small Business Owner
From managing finances and achieving marketing targets to maintaining a healthy and productive workforce, small business owners bear the weight of countless responsibilities. One of the most essential obligations of a small business owner is ensuring compliance with employee benefits such as paid sick leave. Below we will break down what a small business owner needs to know about paid sick leave, so you can keep your team and business thriving.
While federal legislation does not mandate paid sick leave, many states have enacted their own regulations governing employee wellness. Small business owners must stay up to date on these ever-changing laws, striking a delicate balance between safeguarding their business interests and protecting the well-being of their employees. When employees are spread across states and cities, ensuring regulatory compliance demands a close partnership between payroll and HR teams.
What Exactly is Paid Sick Leave?
Paid sick leave is a type of employee benefit that allows workers to take time off from work when they are sick or need to care for a sick family member without losing pay. This benefit enables employees to recover from illnesses without the financial burden of lost wages.
When workers are ill, they need time to rest and recuperate to prevent the spread of illness and ensure a speedy recovery. Without paid sick leave, employees may feel compelled to come to work while sick, potentially exposing their colleagues to illness and compromising their own health.
Paid sick leave also allows employees to care for sick family members without fear of financial repercussions. This flexibility is particularly important for parents and caregivers, enabling them to fulfill their familial responsibilities without jeopardizing their employment.
What are Paid Sick Leave Requirements as a Business Owner?
There is currently no federal mandate for paid sick leave for businesses of any size. This means that you do not have a minimum amount of leave you must offer by law. With that said, individual cities and states do enact their own paid sick leave laws, and these determine your obligations as a small business owner. Verify the laws required within the states and cities in which your business operates.
Within these individual states and cities, requirements can vary in terms of the following:
Accrual rate: How much paid sick leave employees earn per hour worked.
Annual caps: The maximum amount of paid sick leave employees can accrue.
Carryover: Whether unused leave can be carried over to the next year.
Eligible employees: Whether part-time and temporary workers are covered.
How to Determine Paid Sick Leave Requirements
The following steps will help you to understand your specific paid sick leave requirements as a small business owner.
Determine your location: Identify the state and city where your business or employees operate.
Check these state and local laws: Research the specific paid sick leave regulations in these locations. Many state labor departments have helpful online resources.
Consider your number of employees: Check if any specific requirements apply based on your employee count.
Consult with a professional: For complex situations or further guidance, consult with an HR professional or attorney specializing in employment law to ensure your small business is compliant.
Even if state or local laws do not mandate paid sick leave, offering this benefit can have numerous advantages for small businesses.
Many states and cities have enacted their own paid sick leave laws despite there being no federal mandate requiring the employee benefit. These mandates vary in terms of eligibility, accrual, usage, and enforcement. Small business owners must carefully review these laws to ensure compliance and avoid potential penalties.
Schedule a free consultation today with PayWorks to better understand the Paid Sick Leave requirements and options for your small business.
PayWorks is not providing legal or tax advice. The information on this website is for informational purposes only and should not be relied upon as legal or tax advice. You should consult with your own legal and tax advisors before making any decisions about your financial situation.