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Labor Department rule requires federal contractors to provide paid sick leave

September 30, 2016

The US Department of Labor announced a final rule Thursday requiring federal contractors to provide paid sick leave to employees who work on or in connection with certain federal contracts.

The rule, which applies to all covered contracts solicited and awarded on or after Jan. 1, allows workers to use up to seven paid sick days per year if they are sick, need to take care of a sick family member or must see a doctor or take a family member to a medical appointment. Workers may also use paid sick leave for reasons related to cases of domestic violence, sexual assault or stalking.

“Part of the basic bargain of America is that if you work hard, you should be able to take care of your family,” said US Secretary of Labor Thomas Perez. “Paid sick leave helps workers recover from illness, or be there for their families, whether it’s to take an elderly parent to the doctor or to stay home with a young child with a fever. It allows working families to focus on what really matters most without having to worry about the next paycheck.”

The final rule implements an executive order signed by President Obama in September 2015. The Labor Department stated that when fully implemented, the final rule accomplishes the following:

  • Provides up to 56 hours of paid sick leave per year to an estimated 1.15 million employees of federal contractors, including an estimated 594,000 employees who currently receive no paid sick leave.
  • Ensures that employers have choices in how to best adapt the paid sick leave requirement to their businesses. For example, employers can choose to allow workers to accrue leave over time, or to frontload leave for ease of administration.
  • Includes flexibilities related to integration with employers’ existing paid time off policies and leave provisions in existing collective bargaining agreements.
  • Improves the health and performance of employees of covered federal contractors and brings benefits packages offered by those federal contractors in line with leading firms, ensuring they remain competitive in the search for dedicated and talented employees.
  • Protects the public health by ensuring that covered federal contractors’ employees, customers and clients are able to stay home when they are sick.