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Governor Hogan Offers “The Paid Leave Compromise Act of 2018” – Now What?

Six months ago, we reported that the alleged veto-proof Healthy Working Families Act (HWFA) was vetoed by Governor Hogan.  At that time, Governor Hogan called the bill “deeply flawed” and “job-killing.”  He then created a task force to study paid sick leave plans and submit a report so that his administration could submit emergency legislation to replace the killed bill when the General Assembly reconvenes in January 2018.  We now have that proposed law: The Paid Leave Compromise Act of 2018.

The essence of the HWFA was to require employers with 15 or more employees to provide up to forty (40) hours of paid leave, while smaller employers would be required to provide 40 hours of unpaid leave.  While still using the HWFA as a starting point, Governor Hogan’s compromise does the following:

  • Covered employers who must provide paid leave must have at least 25 employees.
  • Compliance is phased in over time depending on the size of the workforce.
  • The law does not apply to employees who work less than 120 days in a 12-month period (seasonal workers are no longer entitled to leave).
  • Local jurisdictions may not enact paid leave laws.
  • There is no longer a rebuttable presumption of a violation by an employer.
  • Some of the significant penalties and damages are removed.
  • An employer may obtain a hardship waiver based upon significant financial hardship.

While this compromise does improve the picture for employers, there remain significant concerns if the legislation goes into effect as drafted:

  • The paid leave is no longer a “sick and safe leave” bill.  The paid time off may be used “by an employee for any reason.”
  • Employers cannot discipline employees for using the leave, which opens the door to employee abuse and unscheduled and unpredictable absences without recourse.
  • There is no meaningful reason for most employers to deny the leave.

The paid leave debate continues and we will be sure to monitor how this bill plays out once the General Assembly reconvenes on January 10, 2018.

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