02.25.2016 DOL Proposed Rule Requiring Paid Sick Leave for Employees of Federal Contractors Published Today By: Laura D. Windsor

Today, the U.S. Department of Labor published its proposed rule implementing Executive Order 13706.  EO 13706 was signed by President Obama in September 2015, and it requires certain federal government contractors to provide paid sick leave to employees.  Both the EO and DOL proposed rule apply only to government contractors who hold procurement contracts for construction covered by the Davis-Bacon Act, service contracts under the McNamara-O’Hara Service Contract Act, concession contracts, and contracts pertaining to federal property or lands and services.  Under EO 13706 and the proposed DOL rule, federal contractors who have these types of contracts will be required to provide employees 1 hour of paid sick leave per 30 hours of work.  The employee’s paid sick leave time accrues up to 56 hours per year, and the contractor must permit any accrued but unused leave time to carry over to the following year (up to a maximum of 56 hours).  Contractors are not required to pay out accrued but unused leave at time of termination.  However, if an employee leaves the employ of the contractor and is reemployed within 12 months, his or her accrued and unused sick leave bank must be reinstated.  The sick leave may be used not only for the employee’s own illness, but also for the physical or mental illness of his or her children, parents, spouses, or domestic partners.  The sick time also may be used for circumstances in which an employee needs leave following an incident of domestic violence, sexual assault, or stalking.  The DOL rule will be implemented by September 30, 2016 and will apply to new contracts or renewals of expiring contracts that result from solicitations issued on or after January 1, 2017.