NJ’s Paid Sick Leave Bill Will Have Unintended Consequences for Business

This morning, a divided Assembly Budget Committee voted in favor of A2354, which would require all New Jersey employers to provide employees with paid sick leave. The Assembly may now schedule the bill for a floor vote.

A few areas of concern for business:

  • The bill requires employers to provide either five or nine sick days per year (depending on business size) to all workers, including those that are hired on a full-time, part-time or temporary basis. It forces employers to pay the salary of an employee who is home sick and the salary of their replacement. 
  • The bill also allows for the carry-forward of time from year to year and requires employers to keep records of the time every employee takes for at least five years.
  • You will not be able to ask my employee for a doctor's note without paying all the expenses they would incur in getting the note and facing serious legal liability issues.
  • You will also not be able to require your employees to make arrangements to have their work covered even when their absences are foreseeable.
  • The NJ Civil Justice Institute President Marcus Rayner's OpEd piece in the Star-Ledger outlines the hidden liability risks this bill poses:  http://www.nj.com/opinion/index.ssf/2014/11/post_91.html

December 15th message from NJ Business & Industry Association to its members summarizing the negative impact this legislation could have on businesses of all sizes and a link to contact your State legislators to oppose to this bill:

The New Jersey General Assembly is now considering legislation that would require all businesses in the state to offer their employees paid sick leave. NJBIA opposes the bill and is leading a coalition of business groups that is now fighting against passage of the proposal. A paid sick leave mandate would hurt small businesses and penalize companies that already have paid time off policies.

Please contact your Assembly representatives to tell them you oppose this bill that places yet another onerous mandate on New Jersey businesses.

Under the current proposal, all companies with ten employees and above would be required to provide 72 hours per year of paid sick leave and those with fewer than ten employees would be required to offer 40 hours per year. Further, paid sick leave could be carried over from one year to the next.

It is likely that the enactment of this legislation will negatively impact your bottom line. If a worker takes a sick day, you will not only have to pay the salary of that worker, but would also have to pay the salary of their replacement.

The bill would also apply to part-time workers. For example, if a college student takes a part-time job at your business, they will accumulate paid sick leave that they then could use the following summer when they return. Under the legislation, your business would also face sweeping anti-retaliation provisions making it difficult for you to distinguish between legitimate and illegitimate uses of sick leave. For instance, you would have to pay whatever costs would be involved in your employee providing you with a doctor's note.

Even if you already have a Paid Time Off policy you would still be subject to more regulation, additional recordkeeping requirements and a prohibition on requiring your employees to find their replacements (even when their leave is foreseeable).

The legislation is now headed to the floor of the Assembly so there is still time to make a difference. Please contact your Assembly member immediately to let them know how you feel. If you have any questions, please visit keepnjcompetitive.org or contact sriehl@njbia.org

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