Hiring and the Law — Should You Provide Employees With Paid Sick Days?

Devora L. Lindeman, Esq., Partner at Greenwald Doherty LLP, is providing us with insight and information regarding the hiring process. Ms. Lindeman is a management-side employment lawyer and has exclusively represented managers and companies in federal and state agencies and courts with regard to their labor and employment needs for many years.

Questions addressed to Ms. Lindeman may be addressed in this column.

Hiring and the Law
By Devora L. Lindeman, Esq.*

Question:  An applicant I’m considering hiring asked how many sick days she will get, but my company does not offer paid sick days.  Are we required to do so?

Answer:  Whether a company is required to offer paid sick days depends on a number of factors—the main one being geography.  A number of locations require certain employers to provide paid sick days to their employees.  For example, the state of Connecticut requires that companies with 50 or more employees provide paid sick days.  Philadelphia has a paid sick day requirement for city workers and certain companies that do business with the city, and the city of Seattle also has a paid-sick-day city ordinance.  Although many such laws are pending around the country, few are actually being implemented because they are generally opposed by the business community.  If your business is in a location that does not require you to provide paid sick days, then you are generally not required to do so—but there is a key exception to that rule.

This has to do with the difference between employees who are eligible for overtime pay and those who are not. An earlier tip also addressed this subject.  If an employee is properly classified as being exempt from the regulations that require the provision of overtime pay for work over 40 hours in a work week, then the employee can be paid by the hour for any hours worked and pay can be withheld if the employee does not work.  If, on the other hand, the employee is what is called “exempt” from the overtime pay requirements and paid on a salary basis, federal law requires that the employer pay that employer their entire salary for every week the employee works with only limited exceptions where deductions can be made from that employee’s weekly salary.  For example, if an exempt salaried employee takes a personal day for personal reasons, and you do not provide paid personal days, one day of pay can be deducted from the exempt employee’s weekly salary.  However, if the reason the salaried employee is absent is because the employee is sick, it is not so easy.  The regulation allows employers to deduct absences for illness from the salary of an exempt employee only if (1) the employer has a sick day policy and (2) the employee either is not yet eligible for the sick days or has used up their sick day allotment.

Here’s an example of how this works:  Let’s say that your new exempt salaried employee, Chris, is entitled to 3 sick days per year, but your sick day policy says that employees can’t use sick days until they have been employed for three months.  Chris gets a stomach bug in the second month of employment and needs to stay home.  That day can be unpaid since Chris is not yet entitled to the 3 sick days.  Similarly, if Chris uses the 3 days and then needs another one in the same calendar year, that additional day does not have to be paid either.  Those sick days can be deducted from Chris’s weekly salary.

In the same scenario without a company sick day policy, if Chris takes a sick day in any week in which Chris performs work, the company cannot withhold pay for those sick days—without regard to how many sick days Chris takes in a year.  The only exception would be if Chris is out sick for an entire work week and performs no work in that week.  In that case, only, Chris would not need to be paid.

Because of this legal requirement, we generally recommend that companies offer a minimum number of sick days in a sick day policy so they are not caught in a situation of having to pay an exempt employee who is not coming to work his or her entire salary for the week.

*Ms. Lindeman is a Partner at Greenwald Doherty LLP, a law firm that exclusively represents businesses in all aspects of labor and employment law.  These columns are intended to be general information regarding the topic discussed and are not to be considered legal advice regarding a specific situation. Contact a management-side employment attorney familiar with the law of your jurisdiction for specific advice.  Ms. Lindeman is admitted to practice law in NY and NJ and may be contacted at DL@greenwaldllp.com.  She is under no obligation to respond to reader inquiries personally, but may answer general employment law questions through this column.

© 2011 Greenwald Doherty.  May not be reprinted without permission.

As the law varies in each area, please check with an attorney to ensure you are applying these tips within the law.

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