It was just over a year ago that the San Antonio City Council voted to adopt the city’s paid sick leave ordinance, requiring employers to provide paid leave for ill or injured employees or to care for their family members. Ultimately, though, the implementation of the policy was delayed, and uneasiness has continued to rise among local businesses as to how the policy might impact their bottom lines.
Since the ordinance was passed, businesses in San Antonio have been decisive on their approach to meeting the challenges of the new policy. While some quickly organized to challenge the legality of the ordinance, some moved toward compliance out of precaution. Others, however, have sat back and avoided action, anxiously anticipating how the debate might shake out.
The reality for most San Antonio business owners is that there’s truly no more time to waste – no more time to sit idly by and wait for the issue to be resolved by City Council or the courts. Because implementing paid sick leave requires further funds, resources, policies, procedures, training, and potentially technology and staff, businesses need to hash out plans now if they want to be ready on day one, when (or if) the policy is finally enacted. Better safe than sorry.
Originally, the ordinance required employers to provide one hour of earned sick time for every 30 hours worked, with a yearly cap of 48 hours for small employers and 64 hours for those with more than 15 employees. While the final draft is pending, in its current form, the ordinance will require employers to provide one hour of earned sick time for every 30 hours worked, with a yearly cap of 56 hours.
That undoubtedly presents a challenge to many employers, especially local restaurants, small construction companies and other service industry companies. When you’re a lean, family-owned shop, every employee matters, and the loss of even one employee’s time can be tough and exhaustive on a business and its staff.
As a long-time human resources professional and San Antonio resident, I’ll be the first to admit that the ordinance presents some very real, challenging obstacles for local businesses. Even for larger businesses with developed policies, important decisions need to be confronted about enhancing existing policies and monitoring compliance. And no matter your company’s size, you still need to decide whether you’ll absorb the added costs of a new or enhanced paid sick leave policy or whether you pass those costs on to consumers. But you can absolutely plan to minimize the sticker shock and immediately begin building a paid sick leave policy that meets the proposed criteria to avoid disorder and unforeseen expenses down the road.
The challenge facing San Antonio employers is multi-tiered, requiring a series of complex decisions for business owners and managers. But with a well-thought out strategy for implementing a paid sick leave policy as soon as possible, employers can be adequately prepared to thrive despite compounded guidelines.
The first decision business owners must make is whether to adopt the basic rules of the paid sick leave ordinance or to incorporate them into existing paid leave programs if those exist (as long as they provide at least the benefits outlined in the ordinance).
Second, employers must develop programs to track their compliance with the policy, enabling them to provide proof if needed. Whether they’re implementing the ordinance as is or modifying an existing policy, businesses will need to track that they’re providing the requisite 56 hours per year, which will require some sort of manual or automated system of measurement, such as a spreadsheet or advanced payroll solution.
Third, employers need to ensure that any supervisor who has responsibility for carrying out the policy is trained in the ordinance, so that they don’t inadvertently deny a leave or set an obligation on an employee that’s in violation.
And lastly – it’s vital that employers be prepared to adequately articulate employees’ rights, updating employee handbooks in compliance and posting materials to notify employees of policy changes.
For most employers, there are costly considerations to implementing a policy in accordance with the new ordinance, even with ample time to prepare.
One factor worth considering is the speed in which employees becomes eligible for leave. To comply with the ordinance, employees must be able to start taking this after 90 days of employment, which is generally earlier than many employers allow employees to take time off. Employers can choose to either grant the entire allotment of sick time at the beginning of the year or permit employees to carry over their unused balance of allotted time to the next calendar year.
The first option means risking that employees use up their allotted time early in the calendar year, even before resigning or leaving the company. The second option creates a record-keeping challenge that many small businesses would need to separately address.
That leads to a second necessary consideration – as many small businesses generally don’t staff a human resources department, there might be added costs to compliance, including hiring an HR specialist, writing new policies, training management, and enhancing payroll and record-keeping capabilities. Employers might also need to be prepared to add people to cover for staff in the event they find themselves short-handed as a result of employees taking leave.
The task of meeting the requirements of the expected paid sick leave ordinance might seem daunting to San Antonio businesses. However, there are unavoidable risks, costs and still many unknowns. Even so, companies that refuse to face the impending paid sick leave resolution might find themselves unable to meet the demands of the ordinance, short-staffed, short on cash and too lean to manage and track compliance.
There might even be benefits to early implementation. Competitive paid sick leave offerings could help with recruiting in a tight labor market. That’s why we’re advising our clients at RSM to start now – absorb the costs and do the hard work now. No matter what council or courts decide, or how raucous the debate becomes, having an intact paid sick leave policy when the fate of the ordinance is decided ultimately benefits your business, your people, and your company’s future.