Sick Leave Pay

What Is Sick Leave Pay?

Sick leave pay allows employees to be compensated while taking time off work to tend to their health needs. Employees commonly use sick time when they're ill, injured, or have a dentist or doctor appointment. Many company policies and state laws let employees use paid sick leave to care for either themselves or an immediate family member.

Paid vs. Unpaid Sick Leave

Employers may grant paid or unpaid sick leave to their employees depending on the circumstance. The difference between the two is compensation. Paid sick leave comes with a financial benefit, so employees can worry less about losing a day's pay for taking necessary time off. Unpaid sick leave is permission to take time off for health reasons but without pay.

Is FMLA Paid or Unpaid?

The Family and Medical Leave Act (FMLA) is separate from a company's paid time-off (PTO) policy. This federal law provides guidelines on unpaid, job-protected leave for medical and familial reasons. Covered employers may require eligible employees to use paid sick time as part of their FMLA-protected leave period. Employees may also voluntarily use some or all of their employer-provided vacation pay hours during this absence.

As long as the employee’s leave request meets all FMLA guidelines—and they haven't been laid off due to a reduction in force or dismissed for misconduct—the employee is entitled to reinstatement of their job, salary, and benefits upon their return.

Can an Employer Deny a Sick Day?

Employers can technically deny a sick day if the request would cause significant difficulty or expense, according to the US Equal Employment Opportunity Commission (EEOC). Eligible FMLA requests are an exception to this rule and must be honored.

However, some states have distinct sick time laws. If your jurisdiction requires businesses to provide paid or unpaid sick leave to eligible employees, an employer cannot deny the request. The only exception is if the employee has no qualifying reason according to applicable laws.

Do You Have to Offer Sick Leave Pay to Employees?

There are no federal legal requirements for companies to provide paid sick leave, but it helps nurture work-life balance and employee satisfaction Paid sick time is more common in the public sector than in private companies. For example, 92% of state and local government workers receive paid sick leave, while 78% of private-sector employers offer this benefit.

Do You Get Paid for Sick Days as a Contractor or Part-Time Worker?

While many sick pay laws cover part-time employees, most don't cover independent contractors. The exception is usually if the contract explicitly allows the worker sick leave or the employer has misclassified the employee.

Is Sick Leave Paid in Every State?

No, not every state mandates sick pay. Of those that do, the law typically has requirements around accrual rates, business size, eligibility, and other factors. Also, some regulations are explicitly centered around sick time, while others allow general PTO. As of 2023, 17 states and Washington, D.C., have paid leave laws:

• Arizona
• California
• Colorado
• Connecticut
• Maine
• Maryland
• Massachusetts
• Michigan
• Minnesota (effective 1/2024)
• New Jersey
• New Mexico
• New York
• Nevada
• Oregon
• Rhode Island
• Vermont
• Washington

Additionally, several cities and counties have enacted their own regulations. For updates on sick-time laws and related topics, refer to the National Conference of State Legislatures (NCSL) or your state/local government website.

COVID-19 Sick Leave Laws

In response to the COVID-19 pandemic, the US Department of Labor (DOL) established the Families First Coronavirus Response Act (FFCRA). This law required certain private and public employers with fewer than 500 employees to offer paid sick leave, or expanded family and medical leave, for reasons related to COVID-19. The FFCRA ended on December 31, 2020.

The American Rescue Plan Act (ARPA) incentivized businesses to continue providing paid leave by extending employer tax credits offered under FFCRA through September 30, 2021. However, these provisions have also expired.

Eligible employees sick with COVID-19 may be entitled to leave under the FMLA, state law, or company policy (just like other illnesses). Additionally, some areas have adopted laws for sick time during public health emergencies, providing coverage for future crises.

How Many Sick Days Do Companies Offer on Average?

On average, civilian workers receive eight days of paid sick time per year. Private industry workers receive an average of seven days, while state and local government workers typically receive 11 days after one year and 12 days after five years.

Research also shows access to paid sick time is more prevalent among higher earners, which means many workers with lower incomes must choose between taking time off and getting paid for that day.

How Many Sick Days Do You Get Under FMLA?

According to the FMLA, eligible employees receive up to 12 workweeks of unpaid leave in a 12-month period if they or their immediate family member has a medical condition that requires attention. Alternatively, they may take up to 26 weeks of job-protected military caregiver leave in a 12-month period to care for a covered servicemember with an injury or illness.

How Does Sick Leave Accrue?

In 2021, 69% of all civilian workers with paid sick leave received a fixed number of days. In other cases, sick leave accrues based on the amount of time worked. While sick-time accrual rates vary by company, some states set minimum requirements, as well.

Depending on a company’s sick days policy or state laws, unused leave time may sometimes roll over into the next year. However, this time may be capped at a certain number of hours/days. For example, California’s Paid Sick Leave Law allows employers to limit carryover leave to 40 hours or 5 days per year (effective 1/2024).

What Should You Include in Your Sick Leave Policy?

Though company culture and state laws vary, we recommend employers include the following information in their paid sick leave policies:

• PTO accrual rate: The policy should provide a detailed overview of how many hours of sick leave pay employees accrue after working a certain number of hours.
• Rollover rules: If employees can carry some or all of their earned sick time into the next year, explain how this works.
• Benefit waiting period/eligibility: It should also note whether PTO accrual begins at an employee’s date of hire or after a certain employment period.
• Paid leave usage: This should flesh out the circumstances that would fall under paid sick leave (personal illness, illness of an immediate family member, medical/dental appointments, etc.).
• Sick leave laws: You should provide links to applicable federal and state laws your employees can refer to for any further queries.
• Time-off request process: Employees should understand how to request sick leave. For example, you may want them to notify their supervisors via email or phone as soon as possible and have them document their sick days in their HR software platform.