If Pain, Yes Gain – Part 128: Alaska, Missouri, and Nebraska Join Nation’s Paid Sick Leave Law Patchwork

What You Need to Know:

• As we reported last week, paid sick leave initiatives were on the ballot and up for vote in three states – Alaska (“Ballot Measure No. 1”), Missouri (“Proposition A”), and Nebraska (“Initiative 436”).
• Notably, constituents in all three states have voted and passed their respective paid sick leave ballot measures[1]. The three paid sick leave mandates will go into effect on the following dates: (a) Alaska – effective July 1, 2025; (b) Missouri – effective May 1, 2025; and (c) Nebraska – effective October 1, 2025.

Paid Sick Leave Laws – Background.

Currently, there are 19 states, plus Washington D.C., with either a statewide paid sick leave or paid time off law on the books.[2] A number of these states have experienced recent paid sick leave activity, including notable amendments in California, Connecticut, Massachusetts, Michigan, and Minnesota. Alaska, Missouri, and Nebraska now join a growing and constantly evolving list of paid time off mandates that impose complicated compliance challenges on both intrastate and multi-state employers.

Paid Sick Leave Highlights – Alaska, Missouri, and Nebraska.

Below are some highlights from the impending paid sick leave mandates in Alaska, Missouri, and Nebraska. Additional details on each laws’ other substantive technical requirements – such as, but not limited to, documentation, employee notice to employers, new hire usage waiting periods, notice and posting requirements, recordkeeping, replacement employees, employee transfers, successor employers, rate of pay, increments of use, and use of non-sick paid time off for paid sick leave compliance – will be provided in forthcoming articles.

Employer Coverage:

• Alaska: The impending Alaska paid sick leave mandate does not include its own definition of “employer” nor does it base paid sick leave coverage on employee headcount.
• Missouri: The impending Missouri paid sick leave mandate defines “employer” as any person acting directly or indirectly in the interest of an employer in relation to an employee, excluding the United States Government and political subdivisions of Missouri. As proposed, the ballot initiative does not base employer coverage on employee headcount.
• Nebraska: An employer is subject to the impending Nebraska paid sick leave mandate if they employ one or more employees, regardless of whether they are an individual, partnership, limited liability company, association, corporation, business trust, legal representative, or organized group of persons. However, the United States and the State of Nebraska, including any agencies, departments, or political subdivisions, would be excluded from coverage under the impending paid sick leave mandate.

Employee Eligibility:

• Alaska: The impending Alaska paid sick leave mandate does not include explicit employee eligibility requirements. However, employees subject to the federal Railroad Unemployment Insurance Act are exempt from receiving paid sick leave benefits. In addition, Ballot Measure No. 1 notes several categories of individuals who appear to be exempt from coverage under a possible future Alaska paid sick leave mandate, including but not limited to, certain apprentices; individuals engaged in nonprofit activities of religious, charitable, cemetery, or educational organization; part-time employees under 18 years of age; taxicab drivers; and certain students.
• Missouri: The impending Missouri paid sick leave mandate states that employees, defined as individuals employed in Missouri by an employer, will be covered by the Missouri Paid Sick Leave Law. However, there are various exclusions, including but not limited to the following: those employed by charitable, religious, or nonprofit organizations; those who stand in loco parentis to foster children in their care; resident or day camp employees; employees who provide educational services in lieu of tuition, housing, or educational fees; employees who work occasionally on a private residence; baby-sitters; railroad employees; golf caddies and newsboys; certain government employees; retail or service employees whose businesses make less than $500,000 per year; incarcerated persons; and certain publication / newspaper employees.
• Nebraska: Any individual employed by an employer will be eligible for paid sick leave per the impending Nebraska paid sick leave mandate. There are exclusions for individuals who work in Nebraska for fewer than 80 hours per calendar year and those subject to the federal Railroad Unemployment Insurance Act.

Covered Reasons for Use:

• Alaska: Eligible employees can use available paid sick leave for the following reasons:
  • An employee’s own mental or physical illness, injury, or health condition; need for medical diagnosis, care, or treatment; or need for preventative medical care;
  • Care or assistance to a family member relating to mental or physical illness, injury, or health condition; need for medical diagnosis, care, or treatment; or need for preventative medical care; and
  • Absence necessary due to domestic violence, sexual assault, or stalking if the leave is to permit the employee to obtain for themselves or a family member medical or psychological attention, services from a victim’s aid organization, relocation, or legal services.
• Missouri: Eligible employees can use available paid sick leave for the following reasons:
  • The employee’s own mental or physical illness, injury, or health condition; need for medical diagnosis, care, or treatment; or need for preventative medical care;
  • Care of a family member who has a mental or physical illness, injury, or health condition; who needs medical diagnosis; or who needs preventative medical care;
  • Closure of the employee’s place of business by order of a public official due to a public health emergency; need to care for a child whose school or place of care has been closed by order of a public official due to a public health emergency; or need to care for oneself or a family member when it has been determined by health authorities that the presence of the individual in the community may jeopardize the health of others due to exposure to a communicable disease; and
  • Absence necessary due to domestic violence, sexual assault, or stalking if the leave is to permit for medical attention (physical or psychological injury); services from a victim services organization; counseling; relocation; or legal services for the employee or the employee’s family member.
• Nebraska: Eligible employees can use available paid sick leave for the following reasons:
  • The employee’s own mental or physical illness, injury, or health condition; need for medical diagnosis, care, or treatment; or need for preventative medical care;
  • Care of a family member who has a mental or physical illness, injury, or health condition; who needs medical diagnosis; who needs preventative medical care; or, in the case of a child, to attend a meeting necessitated by the child’s mental or physical illness at a school or place of care; and
  • Closure of the employee’s place of business by order of a public official due to a public health emergency; need to care for a child whose school or place of care has been closed by order of a public official due to a public health emergency; or the need to self-isolate or care for a family member when it has been determined by health authorities that the presence of the individual in the community may jeopardize the health of others due to exposure to a communicable disease.

Family Members:

• Alaska: Under the impending Alaska paid sick leave law, family member is defined as: spouse; another person cohabitating with the person in a conjugal relationship (that is not a legal marriage); a child, including step or adoptive; a parent, sibling, grandparent, aunt, or uncle; a parent or sibling of the employee’s spouse; a domestic partner; a foster child, legal ward, or person to whom the employee stands in loco parentis; a foster or adoptive parent, legal guardian, or person who stood in loco parentis when the employee was a minor child; or any other individual related by blood or whose close association is the equivalent of a family relationship.
• Missouri: Under the impending Missouri paid sick leave law, family member is defined as including the following individuals: a biological, adopted, or foster child, stepchild, legal ward, child of a domestic partner, or child to whom the employee stands in loco parentis or stood in loco parentis when said child was a minor, regardless of age; a biological, foster, step, or adoptive parent or legal guardian of the employee or employee’s spouse or domestic partner; a person who stood in loco parentis to the employee, employee’s spouse, or domestic partner when they were a minor child; a legal spouse, domestic partner, or individual with whom the employee is in a continuing social relationship of a romantic or intimate nature; a grandparent, grandchild, or sibling (whether adoptive, foster, step, or biological) of the employee, employee’s spouse, or domestic partner; or a person for whom the employee is responsible for providing or arranging health or safety-related care.
• Nebraska: In Nebraska, the definition of family member includes: a biological, adopted, or foster child, stepchild, legal ward, or child to whom the employee stands in loco parentis, regardless of age; a biological, foster, step, or adoptive parent or legal guardian of the employee or employee’s spouse; a person who stood in loco parentis to the employee or employee’s spouse when they were a minor child; a legal spouse; a grandparent, grandchild, or sibling (whether adoptive, foster, step, or biological) of the employee or employee’s spouse; any other individual related by blood; or any other individual whose close association is the equivalent of a family relationship.

Accrual:

• Alaska: Eligible employees accrue a minimum of one hour of paid sick leave for every 30 hours worked up to an annual accrual cap of 40 or 56 hours depending on employer size. Specifically, the 40-hour annual accrual cap applies to employers with fewer than 15 employees, while the 56-hour annual accrual cap applies to employers with 15 or more employees.
• Missouri: Eligible employees accrue a minimum of one hour of earned paid sick leave for every 30 hours worked. The law currently is silent on whether employers can establish a cap on accrual.
• Nebraska: Eligible Nebraska employees will accrue a minimum of one hour of earned paid sick leave for every 30 hours worked. Accrual will be capped at 40 hours of paid sick leave per year for employees of small businesses, and 56 hours per year for employees of an employer that is not a small business.

According to Initiative 436, a “small business” is defined as one with fewer than 20 employees during a given week—including full-time, part-time, or temporary employees. Employers that maintain 20 or more employees on their payroll in each of 20 or more calendar weeks in the current or proceeding calendar year are not considered a “small business.”

Frontloading:

• Alaska: The impending Alaska paid sick leave law does not appear to specify parameters regarding frontloading.
• Missouri: The impending Missouri paid sick leave law permits an employer to provide all earned paid sick leave that an employee is expected to accrue in a year at the beginning of the year. It is unclear whether such a frontload will suffice to avoid accrual and/or year-end carryover obligations.
• Nebraska: Per the impending Nebraska paid sick leave law, Nebraska employers may provide all paid sick leave that an employee is expected to accrue in a year at the beginning of the year. It is unclear whether such a frontload will suffice to avoid accrual and/or year-end carryover obligations.

Year-End Carryover:

• Alaska: Unused paid sick leave will carry over to the following year. Regardless of carryover balances, employers are not required to allow an employee to exceed the applicable usage cap, as provided below.
• Missouri: Up to 80 hours of earned unused sick leave will carry over at year end. However, this does not require an employee to permit an employee to exceed the usage caps discussed below. Relatedly, there exists a potential payout alternative to year-end carryover.
• Nebraska: Accrued, unused paid sick leave carries over to the following year, without any prescribed limitations. Relatedly, there exists a potential payout alternative to year-end carryover.

Usage Caps:

• Alaska: Employees of employers with 15 or more employees are not entitled to use more than 56 hours of paid sick leave per year. Employees of employers with fewer than 15 employees are not entitled to use more than 40 hours of paid sick leave per year. Both of these usage caps are subject to employer discretion, should it prefer to set a higher limit.
• Missouri: There is a 56-hour annual usage cap for employees of employers with 15 or more employees, and a 40-hour annual usage cap for employees of smaller employers. Employers have discretion to be more generous.

To determine an employer’s number of employees, all employees performing work in the State for the employer for compensation on a full-time, part-time, or temporary basis must be counted.

• Nebraska: Employees of small businesses cannot use more than 40 hours of paid sick leave in a year. Employees of employers that do not constitute small businesses may not use more than 56 hours of paid sick leave per year.

As noted above, and consistent with the existing patchwork of state and local paid sick leave and paid time off laws currently in effect, the impending Alaska, Missouri, and Nebraska mandates also touch on an array of additional topics, including, but not limited to, documentation, employee notice to employers, new hire usage waiting periods, notice and posting requirements, recordkeeping, replacement employees, employee transfers, successor employers, rate of pay, increments of use, and use of non-sick paid time off for paid sick leave compliance.

What Should Employers Do Next?

Employers with operations in Alaska, Missouri, or Nebraska should consider the following steps in light of the three new impending paid sick leave mandates:

• Review existing leave policies and practices to ensure compliance with the new law(s), including related attendance, conduct, anti-retaliation, and discipline policies and practices.
• Train supervisory and managerial employees, and HR on the new requirements.
• Monitor the each State’s respective Department of Labor website for the release of administrative guidance and other materials on employers’ paid sick leave compliance obligations.

With the paid leave landscape continuing to expand and grow in complexity, companies should reach out to their Seyfarth attorney for solutions and recommendations on addressing compliance with nationwide paid leave requirements. To stay up-to-date on paid leave developments in Alaska, Missouri, Nebraska, and beyond, click here to sign up for Seyfarth’s Paid Leave mailing list. Companies interested in Seyfarth’s paid sick leave laws survey should reach out to paidleave@seyfarth.com. 

 

 

[1] As of the publication of this article, technically Alaska was reporting 76% of the vote with 56.5% of individuals voting “yes” in favor of Ballot Measure No. 1’s paid sick leave mandate. A “yes” vote of 50% is needed to formally pass the measure – which is expected to happen. If this changes, we will provide an update.

[2] Today, the states that have enacted a statewide general paid sick leave or paid time off mandate include: (1) Arizona; (2) California; (3) Colorado; (4) Connecticut; (5) Illinois (PTO law) (effective 1/1/2024); (6) Maine (PTO law); (7) Maryland; (8) Massachusetts; (9) Michigan; (10) Minnesota (effective 1/1/2024); (11) Nevada (PTO law); (12) New Jersey; (13) New Mexico; (14) New York; (15) Oregon; (16) Rhode Island; (17) Vermont; and (18) Washington. In addition, (19) Virginia has a statewide paid sick leave law that applies only to certain home health workers. There also is a paid sick leave mandate in (20) Washington, D.C.. Further, there are more than two dozen municipalities with paid sick leave or paid time off mandates in the United States.