Banking & Finance, Government, and Health Care

Paid medical leave on horizon for qualified workers

New law will require employers with 50 or more employees to provide benefit.

February 22, 2019
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Some Michigan employers soon will have to adhere to a new medical leave law.

Starting March 29, Michigan employers with 50 or more employees will be required to provide paid medical leave to some of their employees under the Michigan Paid Medical Leave Act.

Maureen Rouse-Ayoub, labor and employment attorney at Varnum Law, said qualified employees are hourly workers who work more than 25 hours per week and more than 25 weeks in a year.

Under the law, paid medical leave would qualify as personal or family health needs, as well as issues relating to domestic violence and sexual assault, and school meetings needed as a result of a child’s disability, health issues or issues due to domestic violence and sexual assault.

According to the Michigan Department of Licensing and Regulatory Affairs, eligible employees do not include executives, administrators and professional overtime-exempt employees; employees covered by a private collective bargaining agreement that is in effect; employees of the U.S. government, another state or a political subdivision of another state; individuals whose primary work location is not in the state; individuals 16-19 years of age being paid the youth training wage in accordance with the Improved Workforce Opportunity Wage Act; temporary employees as described in the Railway Labor Act and Railroad Unemployment Insurance Act; individuals employed by an employer for 25 weeks or fewer in a calendar year for a job scheduled for 25 weeks or fewer; and individuals who work, on average, fewer than 25 hours per week during the immediately preceding calendar year.

The new law allows employees to follow the accrual method where they must accrue paid medical leave at a rate of at least one hour of paid medical leave for every 35 hours worked, allowing for a cap of 40 hours per year. Employees can use those paid medical leave hours as they are accrued, except when an employer requests the start of the accrual of those hours 90 days after hiring.

Rouse-Ayoub said employers also can use the frontloading method, where employers can freely provide 40 hours for their employees each benefit year.

“Employers can choose to award its existing employees, and all newly hired employees on a prorate basis depending on when they start, a bank of 40 hours of paid medical time off instead of them earning it over time,” she said.

As a result, employees will get 40 hours of paid medical leave at the beginning of each benefit year. However, employers who choose to use the accrual method may allow employees to carry over 40 hours of unused paid medical leave from one year to the next.

Laura Dyke, HR business partner for HR Collaborative in Grand Rapids, said if employers already have a paid time off (PTO) policy in place, they do not have to implement the new law in their workplace.

“(Employers) are already in compliance if they are already providing at least 40 hours of time off, whether it is coded as vacation, sick time or PTO,” she said. “If employers are already giving their employees that time, then they are automatically in compliance. The employee can use that time to go to the Bahamas. There is nothing that says that the time has to be used for sick time if the employer doesn’t care. They can say, ‘I am giving one bucket, you have at least 40 hours to use for sick time but if you choose to go to the Bahamas, then that is your prerogative and I am not going to stop you.’”

With a PTO policy in place, Dyke said employers will then have to make changes to their attendance policies, recording sick time versus vacation time, changing the time period in which employees must notify their employers when taking their sick time versus vacation time and also adjusting their disability policy.

Employers with a PTO policy in place also can create two separate “buckets” for paid medical leave and paid vacation time, according to Dyke.

“There is a growing mindset, aside from retaining their employees, that it is important for recruitment of talent,” Rouse-Ayoub said. “There is a growing movement that by providing certain types of benefits, you’ll attract skilled workers to your geographical area and there is also a growing movement by individuals who want to improve the benefits that are available to employees.”

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