The 2nd Shoe Has Dropped!

by Jack W. Lunsford

On November 8, 2016, Arizona voters approved Proposition 206, The Fair Wages and Healthy Families Act. So, on January 1, 2016, the minimum wage for non-tipped workers increased to $10/hour, and nearly all employers know that.

However, effective July 1st, the 2nd shoe from Prop. 206 dropped. Every business with one or more employees must now provide all employees with Mandatory Earned Paid Sick Leave (EPSL).

Guess what? Most Arizona businesses don’t know that, and Arizona has 540,000 small businesses! The record keeping is onerous and time consuming. The costs of non-compliance could put businesses at significant financial risk. The penalties for non-compliance are costly, including legal costs fighting employee complaints.

Take note: Ignorance of this law will be no excuse, yet the rules promulgated by the Arizona Industrial Commission clarifying the law and providing guidance to businesses won’t even be approved until early January 2018.

The good news: If businesses get into compliance quickly, they can reduce their loss exposure, and ASBA is leading the way to assist all businesses to become compliant. ASBA is presenting Prop. 206 workshops and soon will be offering them in Tucson and rural Arizona. ASBA will also be offering its members email updates and website posts.

ASBA’s immediate advice is: 1) Adopt a personnel manual, and have the employees sign a receipt of acknowledgement. 2) Document, document, document! 3) Consider separating EPSL from your PTO benefit plan.

Meanwhile, ASBA has already learned that there are unique EPSL situations for almost every business, and our workshops attempt to provide answers to as many as possible. However, there are certain specific, uniform provisions in the law effective now.

Employer Requirements:

  • Employees are entitled to EPSL.
  • Part-time and temporary workers are considered “employees”.
  • Employees accrue 1 hour sick time for every 30 hours worked to the maximum.
  • Retaliation against employees who request or use EPSL is prohibited.
  • Each employee has the right to file a complaint if EPSL is denied.
  • EPSL information must appear on paychecks:
    • EPSL available to the employee,
    • EPSL taken by the employee to date, and
    • Paid time the employee has received as EPSL.
  • Employers shall not use qualifying EPSL absences in disciplining employees for excessive absences.
  • Employer is prohibited from retaliating against an employee for use of EPSL.
  • Employers are not required to pay out unused EPSL upon termination.

Employees may use EPSL for the following reasons:

  • Employee’s own physical or mental illness, injury or health conditions;
  • Care for employee’s family member for one of the above conditions;
  • A public health emergency; or
  • Absence due to domestic violence, sexual violence, or stalking of employee or of an employee’s family member.

Employee Requirements

Employees are required to make a good faith effort to provide notice to an employer, as described in the employee handbook, in advance of taking EPSL.

Employees may file a complaint to the Arizona Industrial Commission or directly to Superior Court.

ASBA is here to bring businesses into compliance before they suffer financial losses. Contact us at or 602-306-4000.

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