On May 2, 2018, New Jersey Governor Phil Murphy signed the Paid Sick Leave Act into law (A-1827 (Lampitt)).  The act will take effect October 29, 2018 and applies to all New Jersey businesses despite their size or number of employees. It also applies to most employees working in the state, except for per diem healthcare employees, construction workers employed pursuant to a collective bargaining agreement, and public employees who already have sick leave benefits. The act requires employers to provide one hour of sick leave for every 30 hours worked with a maximum accumulation of up to 40 hours in a benefit year. An employer can front load the accrual with 40 hours of PTO if your policy allows for it, or if your PTO policy is better.

Businesses using a software based time system will find it easier to manage employee time worked and stay in compliance with this new law.

Employees may use sick leave to:

• diagnose, care, treat or recover from the employee or their family member’s mental or physical illness;
• seek preventative medical care for the employee or a family member;
• in the case of victims of domestic violence, seek medical attention, seek legal services or to attend legal proceedings;
• leave when an employee is unable to work due to closure of the workplace, or school or place of childcare by a public official due to an epidemic, public health emergency, or where there is concern that a health issue could jeopardize the health of others;
• attend school-related events (conferences, meetings, and other activities requested by a school, teacher, administrator, and held during the work day).

The definition of family member is very extensive and includes not only the employee's own children, grandchildren, sibling, spouse, parent or grandparent, but also the sibling or parent of their spouse or partner or civil union of the employee, or any other individual related by blood to the employee or whose close association with the employee is the equivalent of a family relationship.  

Employers will be responsible for notifying employees of their rights under the act by posting a notice.  There are also recordkeeping requirements that employers must follow, including documentation of hours worked and earned sick leave used by the employees.  The records must be maintained for five years. The sick time survives transfers, separation followed by a reinstatement within six months, and acquisitions by successor companies.

Also, the law permits a sick leave payout in the final month of the employer’s benefit year for unused sick leave. If employees choose not to accept a payout, they may carry forward unused sick time up to 40 hours. Unless established in an employer policy or a collective bargaining agreement, unused accrued sick leave cannot be paid out at the time of separation from employment.

This legislation takes effect on the 180th day following passage, which will be October 29, 2018.