Paid Sick Leave DOA

Currently, Texas does not require private-sector companies to provide paid sick-leave for its employees.  However, two Texas cities, Austin and San Antonio, recently passed paid sick-leave ordinances.

In February 2018, the City of Austin ratified an ordinance requiring private employers to provide paid sick-leave to their employees.  The ordinance requires Austin employers to “grant an employee one hour of earned sick time for every 30 hours worked.”  The employee begins earning sick leave at the start of employment and the employer must pay the earned sick leave “in an amount equal to what the employee would have earned if the employee had worked.”  The ordinance caps sick leave at forty-eight or sixty-four hours per year depending on the employer’s size.  Employers violating the ordinance face civil and criminal penalties.  The ordinance, scheduled to take effect on October 1, 2018, was stayed by the Austin Court of Appeals pending resolution of litigation filed by a collection of parties representing private-sector companies.  See Texas Association of Business, et. al v. City of Austin, et. Al, No. 03-18-00445-CV, 2018 WL 6005551 (Tex. App.—Austin Nov. 16, 2018).

While the Austin case was pending, on August 16, 2018, the San Antonio City Council also pass a sick-leave ordinance.  The amendment to the city’s health code requires San Antonio employers to allow workers accrue one hour of paid sick-leave for every thirty-hours worked.  The ordinance allows the time to be used if the employee or a family member becomes sick or injured, are victims of stalking, domestic abuse or sexual assault; or otherwise require medical, mental, or preventive care.  As the two city ordinances are similar, and the Austin ordinance is being challenged on its constitutionality, whether the San Antonio ordinance actually takes effect in August 2019 will most likely be determined by the Austin court’s judgement.

Just recently, on November 16, 2018, the Austin Court of Appeals issued its opinion on the City of Austin case. The Court concluded “that employees who take sick leave are paid the same wage for fewer hours worked or, stated differently, that employees who take sick leave are paid more per hour for the hours actually worked.”  Therefore, the Austin ordinance increased the pay for employees who used paid sick leave and established a wage.  Because the Texas Minimum Wage Act preempts local regulations that establish a wage, and the Austin ordinance established a wage, the court concluded the Austin ordinance was unconstitutional.  The appellate court remanded the case to the district court with the instruction to grant the requested temporary injunction, thereby delaying the effective start date of the ordinance, and to proceed with the claims raised by the private-sector companies on its merits.  

The Austin case is still pending, so no clear guidelines have emerged. For the time being, Texas is leaving paid sick-leave in the hands of private employers to decide what is best for their company.