When Prop 206 (The Fair Wages and Healthy Families Act) passed at the end of 2016 the Minimum Wage Increase received a lot of attention. Receiving far less publicity were the New Paid Sick Leave provisions. Beginning July 1, 2017, all Arizona employers (except State & U.S. Government) are subject to the mandatory minimum paid sick leave provisions of Prop 206. Click for a 2-page pdf summarizing the new law. Here are some highlights:

– Employers must accrue paid sick time for all employees at a minimum rate of one hour of earned paid sick time for every 30 hours worked.
– Employers with less than 15 employees must accrue and allow the use of a minimum of 24 hours per year per employee.
– Employers with at least 15 employees must accrue and allow the use of a minimum of 40 hours per year per employee.
– Unused sick time carries over to the following year, unless the employer decides to pay it out. Therefore, an employee may accumulate far more sick time than the employer is required to allow them to use in a given year.
– Employers must also provide employees either on a paystub or on an attachment to the employee’s paycheck: (1) the amount of earned paid sick time available to the employee, (2) the amount of earned paid sick time taken by the employee to date in the year, and (3) the amount of pay time the employee has received as earned paid sick time.
– Employers must provide a notice of the new rules to all employees by July 1, 2017. Here is an example provided by the Industrial Commission of Arizona (ICA). AZ Earned Paid Sick Time Poster 2017.
– Employers are prohibited from discriminating or retaliating against employees asserting their rights under these provisions.
– Violations are subject to penalties of at least $250 for the 1st violation and at least $1,000 for each subsequent violation.

For more detail see the ICA website for both the original & updated frequently asked questions https://www.azica.gov/

There are still a lot of unanswered questions and confusion about implementation. Due to the complexity of the new rules we recommend consulting with your payroll service provider to ensure compliance beginning July 1, 2017. Take action now to understand the rules, develop procedures, update employee manuals, and adjust the setup in your current payroll system.

Please feel free to give us a call if you have any questions.

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