On June 12, 2018, Rhode Island finalized the Healthy and Safe Families and Workplaces Act.  This Act has an effective date of July 1, 2018. Below are important finalized regulations to be aware of. Please click here for the final bill text.

 

 

 

Covered Employers and Employer Size

 

Employers with an average of 18 or more employees are required to offer paid sick and safe leave to eligible employees. To determine if the employer has 18 or more employees, the agency released the following standard. Employers must take an average of their total Rhode Island employees during the previous payroll year’s highest two employment quarters. This determination will remain in effect for the following 12 months, regardless of any changes in employer size. New employers are required to provide paid sick and safe leave to all employees once there is a total of 18 or more employees on their payroll.

 

 

 

Accrual of Paid Sick Leave

 

The final regulations state that Rhode Island employees will accrue paid sick and safe leave hours on all hours worked regardless of where the work takes place. More significantly, it states that employees will accrue paid sick and safe hours on all hours paid. Due to this requirement, employers will need to include paid holidays (when the employee is not working), paid sick, vacation and personal time, and other forms of paid time off when calculating accrual under the Act’s one hour for every 35 hours worked accrual rate.

 

 

 

Waiting Period for New Hires

 

The final regulations explain that where an employer imposes an appropriate 90-day usage waiting period, it must notify new hires of this requirement in writing. What qualifies for in writing is any printed or printable communication that is provided in a physical or electronic format, including communications that are transmitted through electronic mail, a computer system or is otherwise sent and stored electronically. While electronic notice is permissible, employers must provide the notice in hard copy if requested by the employee.

 

 

 

Rate of Pay Calculation

 

The agency clarifies at what rate the different types of employee should be paid sick and safe leave.

 

Hourly Employees: The employee’s regular hourly rate.

 

Employees who receive different rates for hourly work from the same employer: Employer must annually choose the “same hourly rate” to be either the rate the employee would have been paid for the hours they would have worked or a weighted average of all regular pay rates for the previous pay period, month, quarter or other established period of time an employer customarily uses to calculate the weighted average for similar purposes.

 

Salaried Employees: Total earnings in the previous pay period divided by the employee’s total hours worked during that pay period.

 

Piece Work Employees: Employers may use a reasonable calculation of the wages or fees the employee would have received for the piece work, service or part thereof, if the employee had worked.

 

 

Commissioned Employees: Must be paid the greater of the base wage or the effective minimum wage.

 

Tipped Employees: Must be paid at least the minimum wage.

 

 

 

Loaned PSSL and Wage Deductions

 

The regulations state that an employer can deduct the paid sick and safe leave owed from the employee’s final wages provided that it has obtained the employee’s written permission to do so.  In Addition, the final regulations say that an employer should clearly state in its employment policies that prior to advancing or loaning paid sick and safe leave time it will require employees to agree, in writing, to allow it to recover any outstanding amounts owed from advanced or loaned paid sick and safe leave time via payroll deductions in the employee’s final wages.

 

 

For more information or questions regarding this Act, please visit http://www.dlt.ri.gov/ls/

 

 

 

Thank you for choosing Paylocity as your Payroll Tax partner. Should you have any questions please contact your Paylocity Account Manager.

 

 

This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.