New Paid-Time-Off Law in Arizona

In November 2016, the Arizona voters passed Proposition 206: The Fair Wages and Healthy Families Act (“the Act”). The Proposition received a tremendous amount of media attention because of the increase of minimum wage. According to the Proposition, minimum wage was scheduled to rise from $8.05 to $10 per hour in 2017, to $10.50 in 2018, $11 in 2019 and $12 in 2020. What many Arizona voters did not know was that there was a second part to the Proposition that addressed mandatory employer-provided sick leave.

Although many employers offered Paid-Time-Off (“PTO”) to employees prior to November 2016, they were not required to do so. Starting July 1, 2017 or the commencement of employment, whichever is later, all employers in Arizona are required to provide PTO to their employees.

The Second part of Proposition 206 has since been codified as A.R.S. §23-372. The statute itself is also separated into two parts: employers with 15 or more employees and employers with less than 15 employees. In part, the law states that an employee who works for an employer with 15 or more employees is entitled to a minimum of one hour of earned paid sick time for every 30 hours worked, but that the employee cannot accrue more than 40 hours of earned paid sick time per year. Employees who work for an employer with less than 15 employees is still entitled to one hour of paid sick time for every thirty hours worked but the maximum hours the person can accrue is 24 hours per year. Although the terms of the law seem straightforward, it becomes more nuanced when for instance, the employer already offers PTO, the employee is exempt under the Fair Labor Standard Act, or the employee transfers within the organization to a different department.

Like it does for the Arizona’s minimum wage requirements, the Arizona Industrial Commission will now enforce the law’s paid sick requirements. As such, The Industrial Commission has the authority to levy civil penalties against employers who violate the paid sick requirements.

Whether you are an employee or employer, it is important to be cognizant of your rights and responsibilities under the new law. If you have any questions, call our office for a free consultation.