TITLE 16. LABOR AND EMPLOYMENT

DEPARTMENT OF LABOR AND INDUSTRY

Proposed Regulation

Title of Regulation: 16VAC15-90. Paid Sick Leave Regulation (adding 16VAC15-90-10 through 16VAC15-90-100).

Statutory Authority: §§ 40.1-6 and 40.1-33.6:7 of the Code of Virginia.

Public Hearing Information: No public hearing is currently scheduled.

Public Comment Deadline: January 1, 2027.

Agency Contact: Cristin Bernhardt, Regulatory Coordinator, Hearing Legal Services Office, Department of Labor and Industry, 6606 West Broad Street, Suite 500, Richmond, VA 23230, telephone (804)786-2392, fax (804) 786-8418, or email cristin.bernhardt@doli.virginia.gov.

Basis: Section 40.1-6 of the Code of Virginia authorizes the Commissioner of Labor and Industry to make rules and regulations necessary for the enforcement of Title 40.1 of the Code of Virginia. Section 40.1-33.6:7 of the Code of Virginia requires the commissioner to promulgate regulations for implementation and enforcement of Article 2.1:1 (§ 40.1-33.6:1 et seq.) of Chapter 3 of Title 40.1 of the Code of Virginia.

Purpose: This action protects the public health, safety, and welfare of Virginians by providing employees a right to accrue and use up to 40 hours a year of paid time off.

Substance: This action creates a new chapter, Paid Sick Leave Regulation (16VAC15-90), which establishes standards governing the administration and enforcement of paid sick leave requirements for covered employers and employees. The proposed regulation (i) defines terms; (ii) establishes parameters for employer size and relevant coverage through a phased implementation period; (iii) establishes the method by which covered employees accrue paid sick leave; (iv) creates a framework governing employee use of paid sick leave; (v) provides that sick leave must be paid at the regular rate of pay and establishes guidelines for sick leave pay for tipped employees, employees working at multiple rates, salaried employees, employees working shifts of indeterminate duration, and use of leave during overtime hours; (vi) requires covered employers to maintain a written paid sick leave policy and specifies the policy's minimum required contents; (vii) protects against employer retaliation and interference; (viii) establishes recordkeeping and notification requirements; and (ix) provides for Department of Labor and Industry investigations of alleged violations and enforcement of requirements.

Issues: The primary advantage to the public is greater clarity regarding employer and employee responsibilities, consistent implementation of the statutory requirements, and the establishment of uniform standards for paid sick leave administration, recordkeeping, investigations, and enforcement. The proposed regulation will benefit workers by ensuring that workers have adequate access to paid sick leave that allows them to care for themselves and their families while remaining in the workforce. The proposed regulation will benefit businesses by allowing them to offer competitive benefits that will help them attract and retain employees. The primary advantage to the Commonwealth and the department is consistency in program administration and enforcement. Implementation may require additional administrative resources to support program administration, stakeholder assistance, investigations, and enforcement activities. There are no disadvantages to the public, the agency, or the Commonwealth.

Department of Planning and Budget Economic Impact Analysis:

The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Code of Virginia and Executive Order 19. The analysis presented represents DPB's best estimate of the potential economic impacts as of the date of this analysis.¹

Summary of the Proposed Amendments to Regulation. Pursuant to Chapters 1128 and 1129 of the 2026 Acts of Assembly, the Commissioner of the Department of Labor and Industry (DOLI) proposes to newly promulgate the Paid Sick Leave Regulation (16VAC15-90).

Background. Paid Sick Leave Requirements Prior to Legislation: The statutes in the legislation become effective July 1, 2027. Currently Virginia does not have a generally applicable statutory or regulatory requirement that private employers provide paid sick leave. However, there are paid sick leave requirements for home health workers, full-time state government employees and some local government employees in state law, and full-time federal employees and certain federal contractors also receive paid sick leave per federal regulations; these requirements are noted. Section 40.1-33.4 of the Code of Virginia says home health workers² shall accrue a minimum of one hour of paid sick leave for every 30 hours worked.³ Section 15.2-1605 of the Code of Virginia specifies that every county and city shall annually provide for each employee at least seven days sick leave with pay. The employee in this context consist of an employee or deputy of the attorney for the Commonwealth, the treasurer, the commissioner of the revenue, the clerk of the circuit court, and the sheriff and shall also include the officers and employees of all courts whose salaries are paid by the Commonwealth. Section 51.1-1104 of the Code of Virginia provides that participating⁴ full-time state employees shall receive: 80 hours of sick leave if they have 120 or more months of state service, 72 hours of sick leave if they have 60 to 119 months of state service, and 64 hours of sick leave if they have fewer than 60 months of state service. § 51.1-1104 of the Code of Virginia also provides that qualifying part-time employees⁵ shall receive: 40 hours of sick leave if they have 120 or more months of state service, and 32 hours of sick leave if they have fewer than 120 months of state service. Federal full-time employees accrue four hours of sick leave for each biweekly pay period; and federal part-time employees accrue one hour of sick leave for each 20 hours in a pay status.⁶ 29 CFR Part 13 requires employees performing work on or in connection with certain covered federal contracts to accrue paid sick leave generally at the rate of at least one hour of paid sick leave for every 30 hours worked.

Legislation: Chapters 1128 and 1129 created Article 2.1:1. Paid Sick Leave, within Title 40.1 of the Code of Virginia, Chapter 3 Protection of Employees (Act). The Act requires one hour of paid sick leave for every 30 hours worked for all employees of private employers and state and local governments, with certain exceptions.⁷ Paid sick leave shall be carried over to the year following the year in which it was accrued. An employee shall not accrue or use more than 40 hours of paid sick leave in a year, unless the employer selects a higher limit. Any employer with a paid leave policy, such as a paid time off policy, that provides an employee an amount of paid leave sufficient to meet these requirements, and that may be used for the same purposes and under the same conditions, is not required to provide additional paid sick leave to any employee that is eligible for paid leave under the policy. The paid sick leave requirement applies to employers with at least 50 employees beginning July 1, 2027; employers with at least 25 employees beginning July 1, 2028; and employers with at least one employee beginning July 1, 2029. The enacted § 40.1-33.6:3 of the Code of Virginia states that paid sick leave shall be provided to an employee by an employer for 1. An employee's mental or physical illness, injury, or health condition; an employee's need for medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or an employee's need for preventive medical care; 2. Care of a family member with a mental or physical illness, injury, or health condition; care of a family member who needs medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or care of a family member who needs preventive medical care; or 3. Absence due to domestic violence, sexual assault, or stalking, provided that the leave is to allow the employee to seek or obtain medical care, mental health care, counseling, legal services, relocation or securing of an existing home, or other victim services for the employee or the employee's family member. The Act also directs the commissioner to promulgate regulations that would fulfill three legislative mandates, which are summarized below. Mandate 1: (§ 40.1-33.6:2 L of the Code of Virginia). Accrual of paid sick leave) provides for the accrual of paid sick leave for employees who are employed and compensated on a fee-for-service basis. Mandate 2: (§ 40.1-33.6:5 of the Code of Virginia) includes requirements for employers concerning employee notice and employer recordkeeping, including: 1. Notification of employees of their rights under this article, both in writing and through required posting, including their right to file a complaint or bring a civil action for violations of this article; 2. Establishing and maintaining recordkeeping systems regarding the use and accrual of paid sick leave, including the requirement to retain records for three years; and 3. Ensuring the confidentiality of any protected health information or information regarding domestic violence, sexual assault, or stalking that the employer possesses about an employee or an employee's family member. Mandate 3: (§ 40.1-33.6:7 of the Code of Virginia) establishes a system utilizing multiple means of communication to receive complaints regarding noncompliance with this article and to investigate complaints received by the Commissioner in a timely manner.

Regulation: Satisfying legislative mandate 1, the proposed regulation provides that employees who are paid on a fee-for-service basis shall accrue paid sick leave based on their actual hours worked when their employer is required to keep records of their hours worked under the Fair Labor Standards Act (29 USC § 201 et seq.) or other applicable law, or if their employer otherwise keeps records of the employee hours worked. For employees who are compensated on a fee-for-service basis, but whose employers are not required to record their hours worked under applicable law, the employer may establish a reasonable method of calculating the number of hours worked by the employee. A reasonable method for determining the number of hours worked by an employee for whom recording hours worked is not required by Virginia, federal, or local law includes: (i) the number of hours in a work schedule agreed upon by the employer and the employee; (ii) billing hours; or (iii) an established practice which provides a reasonable approximation of the hours actually worked by the employee. Hours equal to or above 40 a week are considered 40 for the purposes of sick leave accrual. Satisfying the first part of legislative mandate 2, the proposed regulation says employers shall provide each employee written notice describing their rights under this Act upon hiring, no later than five business days after an employee begins work. An employer shall maintain and display a notice provided by the department in a conspicuous place accessible to employees providing information about an employee's rights under the Act. The right to file a complaint or bring a civil action for violations of the Act are included among the rights to be included in the written and posted notices. Satisfying the second part of legislative mandate 2, the proposed regulation requires employers to retain records for a three-year period documenting each employee's hours worked, hours of paid sick leave accrued, and hours of paid sick leave used, unless the employer falls under one of the following exceptions: 1. An employer that elects to frontload leave is not required to maintain records of hours worked, provided that the employer retain records documenting its practice of frontloading leave and the amount of paid sick leave provided. If the employer elects to provide newly-hired employees with a prorated amount of paid sick leave, the employer must keep records showing the prorated amount of paid sick leave provided to the employee. 2. An employer is not required to maintain records of hours worked for employees who are exempt from overtime requirements under 29 USC § 213(a)(1), provided that the employees accrue paid sick leave as set forth in the Act. 3. An employer is not required to maintain records of hours worked for employees who are covered by 29 CFR 825.801, provided that the employee accrues paid sick leave as though they worked 40 hours in each workweek. Frontloading paid sick leave means providing employees at least 40 hours of paid sick leave or equivalent paid time off at the beginning of each year. The employee would have the right to use that leave immediately upon receiving it. The employer would not be required to keep records of the paid sick leave that the employee would have accrued during that designated year. The amount could be prorated for employees hired after the beginning of the year. Satisfying the third part of legislative mandate 2, the proposed regulation states that an employer commits unlawful interference under the Act if that employer takes an action (including an affirmative act, omission, or statement) that would interfere with a reasonable person's rights or protected activity under the Act or its implementing regulation. Interference can include: Failing to store and maintain the confidentiality of sensitive information, such as information about an employee or their family member health conditions, that the employer receives in relation to a request for paid sick leave; Satisfying legislative mandate 3, the proposed regulation puts forth that upon receipt of a complaint from an employee or third-party, or at commissioner discretion, the commissioner may investigate any alleged violations of the Act. When the commissioner determines that a violation has occurred, and a case is not otherwise resolved through mediation or other means, the commissioner will issue a formal determination letter. The employer may request an informal conference with the commissioner within 15 days of receipt of the formal determination letter regarding the findings. The informal conference will result in a decision of the commissioner. When the commissioner issues a formal determination or decision of violation, the employer may resolve the investigation by taking all corrective action determined appropriate by the commissioner, including paying all back wages, damages, and penalties owed. To prevent future violations, the commissioner may require an employer to enter into a compliance agreement as a condition of resolution. When the commissioner issues a formal determination or decision of violation and the employer refuses to comply or otherwise fails to respond within 15 days of receipt, the decision of the commissioner shall be final. The commissioner may enter a final order against the employer in the appropriate circuit court, refer the matter to the Attorney General, or bring a civil action to enforce the Act.

Estimated Benefits and Costs. Most of the benefits and costs are due to the legislation, either through directly stated requirements in the legislation or direction to provide detail on requirements in the regulation. The proposed requirements in the regulation do appear to minimize the costs necessary to comply with the legislation. Observing data from the U.S. Bureau of Labor Statistics National Compensation Survey for 12 states that introduced mandatory paid sick leave laws,⁸ on average post-mandate workers took 16.8 hours of paid sick leave annually.⁹ The benefits and costs of paid sick leave to employers and employees will differ based upon the situation. The cost to employers will depend upon the extent to which they already provided paid sick leave and the availability of substitute employees. For employers that were already providing at least the minimum required amount of sick leave or an equivalent paid time off policy, there essentially would be no introduced cost.¹⁰ In contrast, for employers that have not been providing paid sick leave it is likely that workers often come to work when they are sick due to the financial pressure of needing the pay. For these employers, after the introduction of paid sick leave workers will be more likely to not come to work when they are sick. However, the cost to these employers will vary depending upon the availability of other workers. For employers of hourly workers, when another hourly employee is available to come in for the person out sick, there would be the cost of paying two employees hourly wages when only one is working. But when another hourly employee is not available there could be either a decrease in the quantity of products produced and available for sale in a given time, or a temporary reduction in the speed and quality of services provided due to fewer workers available in a given shift. When multiple workers are out taking paid sick leave at the same time, and they cannot be replaced, some businesses may even need to close temporarily. On the other hand, the costs to employers of paid sick leave may be somewhat mitigated by certain benefits, including increased employee satisfaction, reduced employee turnover, and an increase in the ability to attract potential employees. The employer may also benefit from a decrease in the spread of illness within the workplace, which may also help reduce the spread of communicable diseases and reduce overall health care costs. Paid sick leave is beneficial for employees, but the impact varies depending on the situation. Hourly and fee-for-service employees receive pay when they are too sick to work or are needed to care for a sick family member, which they would not have received without paid sick leave. Salaried workers may feel less pressure to work when they are sick, which may reduce stress. This can reduce the financial or psychological pressure on employees to continue working while sick and can facilitate earlier access to needed health care, which may help prevent illness from becoming worse. Paid sick day laws are linked to a 5.6% reduction in emergency room visits, with the biggest reductions among Medicaid patients.¹¹ Requiring paid sick leave would particularly benefit low-wage workers who currently have limited access to paid sick leave. Nationwide, only 48% of the lowest-income workers have access to paid sick leave, while 97 percent of the highest-income workers do.¹² In the proposed regulation, the design of recordkeeping requirements for employers beneficially minimizes employer administrative costs in two ways. First, aligning accrual methods and associated administrative obligations with employers existing recordkeeping responsibilities under federal law helps to prevent duplication of effort. Second, the proposal to allow frontloading would also reduce recordkeeping requirements for employers that choose that method, as they would not need to track and calculate paid sick leave accrual throughout the year. Additionally, the Act requires employers to post notification of employee rights under the Act. The proposed regulation instructs DOLI to provide employers with such a poster. This reduces administrative burden for employers since they would not need to compose and create the poster themselves.

Businesses and Other Entities Affected. Employers in the Commonwealth that are not already providing at least the minimum required amount of paid sick leave or an equivalent amount from a paid time off policy would be directly affected by the Act and the proposed regulation. The number of such employers is not currently known. Employees and family members of such employers would be indirectly affected. There are approximately 1,011,000 private sector employees¹³ and 46,000 state and local government employees¹⁴ in Virginia without paid sick leave. Not all of these employees would gain paid sick leave due to the exceptions The Code of Virginia requires DPB to assess whether an adverse impact may result from the proposed regulation.¹⁵ An adverse impact is indicated if there is any increase in net cost or reduction in net benefit for any entity, even if the benefits exceed the costs for all entities combined.¹⁶ The costs are due to the legislation, and the proposed regulation minimizes additional required costs. Thus, no adverse impact from the regulation is indicated.

Small Businesses¹⁷ Affected.¹⁸ As the introduced costs are from the legislation, the proposed regulation does not appear to adversely affect small businesses.

Localities¹⁹ Affected.²⁰ The proposed regulation neither disproportionately affects particular localities, nor introduces costs to local governments.

Projected Impact on Employment. While the legislation may have some impact, the proposed regulation is unlikely to have substantive impact on employment.

Effects on the Use and Value of Private Property. The proposed regulation is unlikely to have substantive impact on the use and value of private property, including real estate development costs.

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¹ Section 2.2-4007.04 of the Code of Virginia requires that such economic impact analyses determine the public benefits and costs of the proposed amendments. Further the analysis should include but not be limited to: (1) the projected number of businesses or other entities to whom the proposed regulatory action would apply, (2) the identity of any localities and types of businesses or other entities particularly affected, (3) the projected number of persons and employment positions to be affected, (4) the projected costs to affected businesses or entities to implement or comply with the regulation, and (5) the impact on the use and value of private property.

² "Home health worker" is defined as an individual who provides personal care, respite, or companion services to an individual who receives consumer-directed services under the state plan for medical assistance services. See § 40.1-33.3 of the Code of Virginia.

³ This applies to home health workers who work on average at least 20 hours per week or 90 hours per month.

⁴ "Participating employee" means any eligible employee required or electing to participate in the Virginia Sickness and Disability Program.

⁵ Qualifying part-time employee is defined as any person who would qualify as a state employee as defined in § 51.1-124.3 of the Code of Virginia but, rather than being regularly employed full time on a salaried basis, is regularly employed part time for at least 20 hours but less than 40 hours per week on a salaried basis.

⁶ See https://www.opm.gov/policy-data-oversight/pay-leave/leave-administration/fact-sheets/sick-leave-general-information/.

⁷ It does not apply to: 1) home health workers who works on average at least 20 hours per week or 90 hours per month and their employers, 2) employees who (i) are licensed, registered, or certified by a health regulatory board within the Department of Health Professions; (ii) are employed by a facility licensed by the Department of Health or the University of Virginia Medical Center or Virginia Commonwealth University Health System Authority; and (iii) works, on average, no more than 30 hours per week, 3) employees who are employed on a pro re nata, or as-needed, basis, regardless of the number of hours worked in the month and who are (i) licensed, registered, or certified by a health regulatory board within the Department of Health Professions; (ii) employed by a facility licensed by the Department of Health; (iii) employed by the University of Virginia Medical Center or Virginia Commonwealth University Health System Authority; or (iv) employed by any agency licensed by the Department of Behavioral Health and Developmental Services, 4) and railroads and railroad employees.

⁸ The 12 states are Arizonia, California, Colorado, Connecticut, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, Vermont, and Washington.

⁹ Source: Maclean, J.C., Stefan Pichler, and Nicolas R. Ziebarth. 2025. Mandated Sick Pay: Coverage, Utilization, and Crowding-in. Journal of the European Economic Association. 23(5):1868 1907, https://pmc.ncbi.nlm.nih.gov/articles/PMC12510734/pdf/jvaf008.pdf.

¹⁰ This assumes that if the employer was already providing at least the minimum required amount of sick leave or an equivalent paid time off policy, that records would be kept. If not, there would be a new recordkeeping cost.

¹¹ Source: Ma, Yanlei et al. 2022. State Mandatory Paid Sick Leave Associated With A Decline In Emergency Department Use In The US, 2011-19. Health Affairs. 41(8), https://www.healthaffairs.org/doi/10.1377/hlthaff.2022.00098.

¹² Source: U.S. Bureau of Labor Statistics, National Compensation Survey, March 2026. The lowest income are those with the bottom ten percent wages. The highest income are those with the top 10% wages. https://www.bls.gov/news.release/ebs2.t06.htm.

¹³ The Federal Reserve Bank of St. Louis shows 3,484,700 Virginia private sector employees in its most up-to-date display accessed on October 12, 2026, https://fred.stlouisfed.org/series/SMS51000000500000001. The U.S. Bureau of Labor Statistics, National Compensation Survey, March 2026 indicates 29% of private sector employees in the South Atlantic do not have paid sick leave. https://www.bls.gov/news.release/ebs2.t06.htm. 3,484,700 x 0.29 = 1,010,563.

¹⁴ The Federal Reserve Bank of St. Louis shows 169,000 state government employees and 411,400 local government employees in Virginia in its most up-to-date displays accessed on October 12, 2026, https://fred.stlouisfed.org/series/SMS51000009092000001 and https://fred.stlouisfed.org/series/SMU51000009093000001A. The U.S. Bureau of Labor Statistics, National Compensation Survey, March 2026 indicates eight percent of state and local government employees in the South Atlantic do not have paid sick leave. https://www.bls.gov/news.release/ebs2.t06.htm. (169,000 + 411,400) x 0.08 = 46,432.

¹⁵ Pursuant to § 2.2-4007.04 D: In the event this economic impact analysis reveals that the proposed regulation would have an adverse economic impact on businesses or would impose a significant adverse economic impact on a locality, business, or entity particularly affected, the Department of Planning and Budget shall advise the Joint Commission on Administrative Rules, the House Committee on Appropriations, and the Senate Committee on Finance. Statute does not define "adverse impact," state whether only Virginia entities should be considered, nor indicate whether an adverse impact results from regulatory requirements mandated by legislation.

¹⁶ Statute does not define "adverse impact," state whether only Virginia entities should be considered, nor indicate whether an adverse impact results from regulatory requirements mandated by legislation. As a result, DPB has adopted a definition of adverse impact that assesses changes in net costs and benefits for each affected Virginia entity that directly results from discretionary changes to the regulation.

¹⁷ Pursuant to § 2.2-4007.04, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

¹⁸ If the proposed regulatory action may have an adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include: (1) an identification and estimate of the number of small businesses subject to the proposed regulation, (2) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the proposed regulation, including the type of professional skills necessary for preparing required reports and other documents, (3) a statement of the probable effect of the proposed regulation on affected small businesses, and (4) a description of any less intrusive or less costly alternative methods of achieving the purpose of the proposed regulation. Additionally, pursuant to § 2.2-4007.1 of the Code of Virginia, if there is a finding that a proposed regulation may have an adverse impact on small business, the Joint Commission on Administrative Rules shall be notified.

¹⁹ "Locality" can refer to either local governments or the locations in the Commonwealth where the activities relevant to the regulatory change are most likely to occur.

²⁰ Section 2.2-4007.04 defines "particularly affected" as bearing disproportionate material impact.

Agency Response to Economic Impact Analysis: The Department of Labor and Industry concurs with the economic impact analysis prepared by the Department of Planning and Budget.

Summary:

Pursuant to Chapters 1128 and 1129 of the 2026 Acts of Assembly, the proposed action creates the Paid Sick Leave Regulation (16VAC15-90), which implements paid sick leave for Virginia workers and includes provisions regarding (i) employer coverage, (ii) accrual of paid sick leave, (iii) use of paid sick leave, (iv) compensation for paid sick leave, (v) leave administration, (vi) protections against retaliation and interference, (vii) notice of rights and recordkeeping, and (viii) investigations and enforcement.

Chapter 90

Paid Sick Leave Regulation

16VAC15-90-10. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Act" means Article 2.1:1 (§ 40.1-33.6:1 et seq.) of Chapter 3 of Title 40.1 of the Code of Virginia.

"Commissioner" means the Commissioner of the Department of Labor and Industry or the commissioner's designee.

"Consecutive workdays" means consecutive days on which a particular employee would have ordinarily worked absent a qualifying reason for leave.

"Days" means calendar days unless otherwise specified.

"Department" means the Department of Labor and Industry.

"Fee-for-service basis" means a payment in which an employee is paid a pre-determined amount to perform a specific task.

"Health care professional," for purposes of § 40.1-33.6:3 of the Code of Virginia, shall have the same meaning as "health care provider" as defined in § 60.2-800 of the Code of Virginia.

"Overtime exempt employee" means an employee who is exempt from overtime requirements under 29 USC § 213(a)(1) of the federal Fair Labor Standards Act (29 USC § 201 et seq.).

"Year" means the regular and consecutive 12-month period determined by the employer for the purpose of paid sick leave administration, as set forth in § 40.1-33.6:1 of the Code of Virginia.

16VAC15-90-20. General provisions.

Nothing in the Act or this chapter shall prevent an employer from adopting or retaining a paid leave policy that is more generous than the one required by the Act.

16VAC15-90-30. Employer coverage.

A. Covered employers. An employer is covered by the Act if the employer meets the definition of employer set forth in § 40.1-33.6:1 of the Code of Virginia, subject to exceptions provided in § 40.1-33.6:4 of the Code of Virginia. All employees of a covered employer are covered by the Act, subject to §§ 40.1-33.6:2 and 40.1-33.6:4 of the Code of Virginia. The Act applies equally to full-time and part-time employees.

An employer shall not avoid coverage by misclassifying employees as independent contractors in violation of § 40.1-28.7:7 of the Code of Virginia.

An employer shall not divide employees among separate entities, worksites, payroll systems, or business units where the entities operate as an integrated employer for purposes of avoiding coverage under the Act.

B. Applicability date by employer size. This chapter will become applicable to covered employers as follows:

1. July 1, 2027: Applicable to employers of at least 50 employees.

2. January 1, 2028: Applicable to employers of at least 25 employees.

3. January 1, 2029: Applicable to employers of at least one employee.

To determine an employer's size, an employer shall count all individuals whom it employed for 20 or more calendar workweeks in the current or preceding calendar year within any state or territory of the United States or the District of Columbia. Employees who are employed outside these areas are not counted for purposes of determining employer coverage. Bona fide independent contractors who are properly classified under § 58.1-1900 of the Code of Virginia shall not be counted as employees for purposes of the Act.

16VAC15-90-40. Accrual of paid sick leave.

A. Paid sick leave, generally. In accordance with § 40.1-33.6:2 of the Code of Virginia, employees shall accrue a minimum of one hour of paid sick leave for every 30 hours worked. Employers must permit employees to accrue at least 40 hours of paid sick leave per year. Employers may elect to allow employees to accrue more than 40 hours of paid sick leave per year.

B. Remote workers in Virginia. Because the definition of employee in §§ 40.1-33.6:1 and 40.1-2 of the Code of Virginia covers remote employees, an employee who works remotely in the Commonwealth while being customarily physically located in the Commonwealth shall accrue paid sick leave under the same terms as other employees under the Act.

C. Occasional work outside Virginia. An employee who customarily works in the Commonwealth, even if the employee occasionally works outside of Virginia, shall accrue paid sick leave for all hours that the employee works, including hours occasionally worked outside the Commonwealth.

D. Frontloading paid sick leave. An employer may elect to satisfy the accrual requirements of § 40.1-33.6:2 of the Code of Virginia by frontloading paid sick leave, which means providing employees at least 40 hours of paid sick leave or equivalent paid time off at the beginning of each year.

1. When an employer provides employees at least 40 hours of paid sick leave or equivalent time off at the beginning of each year, the employee shall have the right to use that leave immediately upon receiving it.

2. An employer that provides employees at least 40 hours of paid sick leave or equivalent paid time off at the beginning of each year is not required to keep records of the paid sick leave that an employee would have accrued during that designated year.

3. For an employee hired after the beginning of the year, an employer may (i) frontload 40 hours or more of paid sick leave or equivalent paid time off or (ii) provide a prorated amount based on the remaining portion of the year, provided that the prorated amount is at least equal to the amount the employee would have accrued based on hours worked.

4. An employer that has provided paid sick leave or equivalent paid time off may not rescind or revoke unused hours of paid sick leave or equivalent paid time off.

E. Separation from employment. Pursuant to § 40.1-33.6:2 of the Code of Virginia, the Act does not require an employer to pay an employee for paid sick leave that was accrued but not used upon separation from employment, regardless of whether the employer elects to frontload paid sick leave or to allow employees to accrue paid sick leave.

F. Employees exempt from overtime protections. As set forth in § 40.1-33.6:2 of the Code of Virginia, employees who are exempt from overtime protections under 29 USC § 213(a)(1) will be assumed to work 40 hours each workweek for purposes of paid sick leave accrual, unless their normal workweek is less than 40 hours. An overtime-exempt employee whose workweek is less than 40 hours shall accrue paid sick leave as follows:

1. An overtime-exempt employee shall accrue paid sick leave based on the employee's actual hours worked if an employer is required to keep records of the employee's hours worked under applicable law or if the employer otherwise keeps records of the employee's hours worked.

2. An employer that is not required to and does not keep records showing hours worked by an overtime-exempt employee whose normal workweek is less than 40 hours may establish a reasonable method of calculating the number of hours worked by the employee. A reasonable method for determining the number of hours worked by an employee for whom recording hours worked is not required by Virginia, federal, or local law includes: (i) the number of hours in a work schedule agreed upon by the employer and the employee, (ii) billing hours, or (iii) an established practice that provides a reasonable approximation of the hours actually worked by the employee.

G. An employee who is paid on a fee-for-service basis. An employee who is paid on a fee-for-service basis will accrue paid sick leave as follows:

1. An employee who is compensated on a fee-for-service basis shall accrue paid sick leave based on the employee's actual hours worked when the employer is required to keep records of the employee's hours worked under the Fair Labor Standards Act (29 USC § 201 et seq.) or other applicable law, or if the employer otherwise keeps records of the employee's hours worked.

2. An employee who is compensated on a fee-for-service basis but whose employer is not required to record the employee's hours worked under applicable law will accrue paid sick leave under the same terms as any other employee exempt from overtime protections as set forth in § 40.1-33.62 of the Code of Virginia and subsection F of this section.

H. Carryover. Pursuant to § 40.1-33.6:2 of the Code of Virginia, an employer must allow any employee to carry over unused paid sick leave that an employee has accrued but not used to the following year.

1. An employee who carries unused paid sick leave into a new year shall continue to accrue paid sick leave under the Act, in addition to the amount carried over.

2. An employer is not required to allow an employee to use more than 40 hours or more of paid sick leave in a single year, including when an employee's total carried over and accrued leave exceeds 40 hours. An employer may choose to set a higher limit or to place no limit on the amount of paid sick leave that an employee may use in a single year. The employer's limit on paid sick leave use must be included in a written policy provided to employees pursuant to 16VAC15-90-70 A 3 and consistently applied to all similarly situated employees.

3. An employer that frontloads at least 40 hours of paid sick leave at the beginning of each year may satisfy the carryover requirement of § 40.1-33.6:2 of the Code of Virginia by providing employees with a total of 40 hours or more of paid sick leave at the beginning of a new year.

I. Changes in employment. Pursuant to § 40.1-33.6:2 of the Code of Virginia, an employee who remains employed by the same employer, but who changes positions, job descriptions, job duties, divisions, entities, or locations shall retain all accrued and unused paid sick leave or equivalent paid time off.

J. Rounding. Pursuant to § 40.1-33.6:2 of the Code of Virginia carryover requirement, employees shall accrue paid sick leave based on hours worked. Employers shall not round an employee's hours worked or accrued leave in a manner that results in an employee receiving less paid sick leave than required by law.

16VAC15-90-50. Use of paid sick leave.

A. Form of paid sick leave requests. Employers shall provide paid sick leave upon proper request from an employee. An employee shall make a proper request for sick leave in one of the following ways:

1. An employee may make a request in writing or by electronic means, including by email, by text message, by submitting a paper or electronic form, or through an employer's scheduling platform.

2. When an employee makes an oral request for leave, the employee and the employer have a mutual responsibility to make a record of that oral leave request within 14 days of the request being made, unless the employer's written paid sick leave policy permits an employee to make oral requests for leave without such requests being recorded.

B. Failure to request leave. If an employee fails to request paid sick leave or fails to make a proper request for paid sick leave, the employer is not required to compensate the employee for that portion of leave taken without a proper request.

C. Contents of paid sick leave requests. A proper request for sick leave is a request that provides sufficient information to make a reasonable employer aware that the employee is seeking paid sick leave, such as an employee's statement that the employee "needs the morning off to go to the doctor." An employee who requests paid sick leave is not required to expressly assert rights under the Act, mention the Act, or use any specialized terms of art for the request to be effective. An employer may ask an employee to provide an estimated amount of paid sick leave needed.

D. Notice of leave. An employer may require employees to provide advance notice, not to exceed seven days, of the use of paid sick leave that can be foreseen more than seven days in advance. An employee may voluntarily choose to provide their employer with more advanced notice than required by the employer's policy. An employee makes a good faith effort to provide advance notice of leave when the employee complies with an employer's usual and customary policy for providing notice. Where it is not practicable for an employee to provide advance notice, an employee makes a good faith effort when the employee provides notice of the need for leave as soon as practicable.

E. Leave increments. Pursuant to § 40.1-33.6:3 of the Code of Virginia, an employer may require an employee seeking paid sick leave to comply with a generally applicable written policy establishing increments for employee leave. An employer may not require an employee to use paid sick leave in increments greater than four hours.

1. An employer may not require employees to take paid sick leave under the Act in greater increments than the employer requires for other forms of employer-provided paid or unpaid leave.

2. A written employer policy that establishes increments of leave larger than one hour must include a policy that would apply when an employee needs to leave work to take leave for less than the employer-required increment due to an urgent and unforeseeable need for paid sick leave, and the time remaining in the employee's scheduled work day is less than the employer-required increment of leave. An employer may not prohibit an employee from leaving work because of an urgent and unforeseeable need for sick leave, including when the employee has fewer than four hours remaining in the employee's scheduled work hours.

F. Medical documentation. Pursuant to § 40.1-33.6:3 A 1 and A 2 of the Code of Virginia, an employee may use paid sick leave for the employee or the employee's family member's visit to a health care provider to obtain documentation from the health care provider or the provider's designee.

G. Family members. Pursuant to § 40.1-33.6:1 of the Code of Virginia, a family member for purposes of this chapter includes a child, grandchild, grandparent, parent, legal guardian, sibling, spouse, or domestic partner of an employee, including those with step, foster, adopted, or in loco parent relationships. A family member includes a person who (i) either regularly resides in the employee's home or who has a relationship with the employee that creates an expectation that the employee will care for such individual and (ii) who depends on the employee for care.

1. An employer may implement a written policy that allows an employee to designate a list of family members for whom an employee may wish to use paid sick leave, in addition to a child, grandchild, grandparent, parent, sibling, spouse, or domestic partner of an employee, including those with step, foster, or adopted relationships. An employer that does so shall:

a. Permit an employee to designate at least two individuals who (i) regularly resides in the employee's home or who have a relationship with the employee that creates an expectation that the employee care for such individual and (ii) who depends on the employee for care;

b. Allow an employee to update the list on an annual basis or more frequent basis, as well as anytime that the employee incurs a major life change;

c. Require an employee to designate those individuals in writing; and

d. Allow an employee to use paid sick leave to care for a child, grandchild, grandparent, parent, sibling, spouse, or domestic partner of an employee, including step, foster, or adopted relationships, none of whom must be included on such a pre-designated list.

2. If an employer does not have a written policy as outlined in subdivision G 1 of this section, an employee may take paid sick leave to care for any person who meets the statutory definition of a family member under § 60.2-800 of the Code of Virginia. The following, nondispositive factors are relevant to whether a person who is not a child, grandchild, grandparent, parent, sibling, spouse, or domestic partner of an employee, including those with step, foster, or adopted relationships, satisfies the definition of a family member:

a. Emergency contact designations;

b. The nature of the relationship;

c. The prior provision of care, such as prior presence at health-related or safety-related appointments;

d. Power of Attorney designations;

e. Life insurance, retirement account, and other beneficiary designations;

f. Shared financial responsibility, including shared leases, common ownership of real or personal property, and joint liability for bills; and

g. Cohabitation and the duration of cohabitation. However, an individual who simply resides in an employee's home with no expectation that the employee care for the individual is not a family member under § 40.1-33.6:1 of the Code of Virginia.

16VAC15-90-60. Compensation for paid sick leave.

A. Regular rate of pay. As provided in § 40.1-33.6:1 of the Code of Virginia, an employer shall compensate an employee for paid sick leave at the regular rate of pay owed by the employer to the employee, as established by § 40.1-29.3 of the Code of Virginia, commonly referred to as the Virginia Overtime Wage Act (VOWA).

1. Notwithstanding any other provision of law, an employee's regular rate shall not be less than the minimum wage amount set forth in § 40.1-28.10 of the Code of Virginia.

2. As set forth in § 40.1-33.6:1 of the Code of Virginia, a tipped employee's regular rate includes the amount of any tip credit claimed by their employer per hour, the reasonable cost of or fair value of any facilities furnished to the employee by the employer, and the cash wages, including commissions and certain bonuses paid by the employer. An employer shall not reduce an employee's paid sick leave pay rate by any tip credit or the fair value of any facilities furnished to the employee.

3. When an employee uses earned sick leave during scheduled hours that would have been paid at an overtime rate (as hours in which a worker was scheduled to work over 40 hours in a single workweek), the employer is required to pay that employee the regular rate of pay, rather than the overtime rate of pay.

B. Payment due date. An employer shall compensate an employee for paid sick leave no later than the regular payday for the pay period in which the leave was used. If an employer requires verification of an absence pursuant to § 40.1-33.6:3 H of the Code of Virginia, the employer shall compensate the employee no later than the regular payday for the pay period in which the employee provides the required verification.

C. Multiple rates of pay. If an employee works at multiple rates of pay, such as because of shift differentials or because the employee performs two different types of work for an employer, the employee's regular rate shall be the weighted average of such rates as set forth in 29 CFR 778.115.

D. Salaried workers. For employees who are paid a salary, no additional pay is due when the employee's use of paid sick leave results in no reduction in the employee's regular salary during the pay period in which the paid sick leave is used.

E. Indeterminate shifts. An employee who requests paid sick leave for a shift of indeterminate duration, such as a shift that is defined by business needs, rather than a previously specified number of hours, shall be paid based on the greater of (i) the hours worked by the employee in the most recent substantially similar shift of an indeterminate length or (ii) the number of hours worked by a similarly situated employee, if any, during the same shift.

16VAC15-90-70. Leave administration.

A. Written policy. Employers shall adopt a written paid sick leave policy that meets or exceeds the minimum requirements of the Act. In addition to the notice requirements set forth in 16VAC15-90-90, an employer shall provide a copy of the written policy to employees whenever the policy is changed, altered, or modified. The written paid sick leave policy must include:

1. The accrual method used, including the rate of accrual, which must meet the minimum requirements of the Act and this chapter;

2. The employer's definition of a "year" for purposes of leave administration, as required by 16VAC15-90-10;

3. Any annual accrual or use limitations established by the employer and consistent with the Act and this chapter, as required by 16VAC15-90-40 H. Accrual or use limitations shall not be less than 40 hours per year;

4. Procedures for requesting leave, which shall be consistent with the requirements of 16VAC15-90-50 A;

5. Any requirement that employees take leave in specific increments of time established by the employer, as required by 16VAC15-90-50 E. Any requirements related to leave increments must be consistent with the Act and this chapter;

6. A statement of employee anti-retaliation and anti-interference protections under the Act; and

7. A process for employees to obtain information about paid sick leave balances.

B. Failure to provide a written policy. An employer shall not deny paid sick leave to or discipline an employee based on the employee's failure to comply with a paid sick leave policy that was not provided in writing as required by 16VAC15-90-90.

C. Documentation requirements. For paid sick leave of three or more consecutive workdays, an employer's written paid sick leave policy may require reasonable documentation that the paid sick leave has been used for a purpose set forth in § 40.1-33.6:3 H of the Code of Virginia. Any documentation requirements must be included in the employer's paid sick leave policy and must be consistent with § 40.1-33.6:3 H of the Code of Virginia.

D. Employer designation of year. An employer's written paid sick leave policy shall designate a "year" that the employer will use for purposes of paid sick leave administration. Pursuant to § 40.1-33.6:1 of the Code of Virginia, a designated year must be a regular and consecutive 12-month period for purposes of administering paid sick leave, such as a calendar year, fiscal year, or benefits year. The designated year must be consistently applied to all similarly situated employees.

1. For any employer that fails to designate a "year" in its written policy, the "year" is the calendar year.

2. An employer may change its designated year only if: (i) the change is prospective; (ii) the change is not a willful attempt to avoid accrual, carryover, or use of paid sick leave; (iii) employees receive written notice at least 30 calendar days prior to the change; and (iv) employees retain all paid sick leave they have accrued but not used.

E. Loaned leave. An employee who accrues paid sick leave based on hours worked may request that their employer loan the employee paid sick leave that the employee has not yet accrued but expects to accrue in the future. An employer may voluntarily agree to loan an employee unaccrued leave. The terms of any loan shall be stated in a written agreement signed by the employee to confirm that the employee understands the terms of using loaned leave.

1. As a condition of loaning an employee paid sick leave, an employer may require that an employee consent to repay the employer through deductions from the employee's final paycheck if that employee separates from employment before accruing the loaned leave.

2. An employer's decision not to loan an employee unaccrued leave shall not constitute retaliation or interference under § 40.1-33.6:6 of the Code of Virginia.

16VAC15-90-80. Protections against retaliation and interference.

A. Retaliation. An employer who takes an adverse action against an individual because of that individual's protected activity commits unlawful retaliation under the Act.

1. "Protected activity" means taking, attempting to take, or being about to take any of the actions set forth in § 40.1-33.6:6 of the Code of Virginia. Protected activity includes being perceived by an employer or other person as taking an action set forth in § 40.1-33.6:6 of the Code of Virginia, such as filing a complaint with the Department of Labor and Industry.

2. "Adverse action" means any action, including an affirmative act, omission, or statement, that would harm an employee or that could deter a reasonable person from engaging in protected activity, including the adverse actions set forth in § 40.1-33.6:6 of the Code of Virginia.

B. Interference. An employer commits unlawful interference under the Act if that employer takes an action, including an affirmative act, omission, or statement, that would interfere with a reasonable person's rights or protected activity under the Act or this chapter. Interference can include:

1. Refusing to authorize paid sick leave that an employee is authorized to use under the Act;

2. Discouraging an employee from using paid sick leave;

3. Failing to store and maintain the confidentiality of sensitive information, such as information about an employee or the employee's family member's health conditions, that the employer receives in relation to a request for paid sick leave;

4. Providing false or misleading information that has the effect of interfering with an employee's ability to access paid sick leave;

5. Requiring an employee to search for or find a replacement worker to cover the hours during which the employee is using paid sick leave or requiring an employee to work an alternative shift to make up for the use of paid sick leave in violation of § 40.1-33.6:3 of the Code of Virginia;

6. Inducing or attempting to induce an individual to prospectively waive a right under the Act or this chapter; or

7. Making any communications or taking any action pertaining to an individual's immigration status that would deter a reasonable person from exercising the person's rights under the Act.

16VAC15-90-90. Notice and recordkeeping requirements.

A. Individual notice. Employers shall provide each employee written notice describing the employee's rights under the Act upon hiring, no later than five business days after an employee begins work. This notice must be provided in a form that an employee can keep or save.

1. In addition to the requirements set forth in § 40.1-33.6:5 of the Code of Virginia, the notice must include: (i) a statement of the employee's right to take paid sick leave under the Act and the terms under which such benefits can be used; (ii) a statement of the employee's anti-retaliation and anti-interference rights; and (iii) a copy of the employer's written paid sick leave policy required by 16VAC15-90-70 A.

2. An employer may satisfy this section by providing an employee (i) a copy of a program notice developed by the department and (ii) a copy of the employer's written paid sick leave policy required by 16VAC15-90-70 A.

3. An employer must also provide an employee with a new copy of the notice and the employer's written paid sick leave policy upon the employee's request. An employee may make such requests no more than once per month, except they may make an additional request when a need for paid sick leave arises.

4. An employer must also provide an employee with a copy of this notice upon transfer to Virginia, no later than five business days after an employee begins work in Virginia.

B. Posters. An employer shall maintain and display a notice provided by the department in a conspicuous place accessible to employees providing information about an employee's rights under the Act. The department will publish a poster in English and Spanish. An employer may satisfy the requirements of this section by posting the program notice electronically, such as on an employer's intranet, employee portal, or website, if all employees customarily receive information from the employer via electronic means and all employees have readily available access to the electronic posting at all times.

C. Recordkeeping. An employer must retain records for a three-year period documenting each employee's hours worked, hours of paid sick leave accrued, and hours of paid sick leave used, unless the employer falls under one of the following exceptions:

1. An employer that elects to frontload leave as provided in 16VAC15-90-40 D is not required to maintain records of hours worked, provided that the employer retain records documenting its practice of frontloading leave and the amount of paid sick leave provided. If the employer elects to provide newly hired employees with a prorated amount of paid sick leave, as provided in 16VAC15-90-40 D 3, the employer must keep records showing the prorated amount of paid sick leave provided to the employee.

2. An employer is not required to maintain records of hours worked for any employee who is exempt from overtime requirements under 29 USC § 213(a)(1), provided that the employee accrues paid sick leave as set forth in § 40.1-33.6:2 of the Code of Virginia.

3. An employer is not required to maintain records of hours worked for an employee who is covered by 29 CFR 825.801, provided that the employee accrues paid sick leave as though they worked 40 hours in each workweek.

4. Nothing in this regulation alters an employer's recordkeeping requirements under other applicable laws.

D. Retention of records. An employer who is aware of a pending complaint, investigation, litigation, audit, or other enforcement action shall retain all records relevant to the action until final resolution.

E. Leave balance on request. Upon an employee's request, an employer shall provide, in writing or electronically, documents sufficient to show the employee's then-current amount of paid sick leave accrued, paid sick leave used, and the paid sick leave balance remaining for use.

1. An employer shall provide this information within three business days of the request. An employer may not charge an employee a fee for providing paid sick leave records.

2. An employee may make such requests no more than once per month, except the employee may make an additional request when a need for paid sick leave arises.

3. An employee may choose a reasonable system for fulfilling such requests, including listing the information on each pay stub, using an electronic system where employees can access the employee's own paid sick leave information, or providing information in a letter or electronic communication.

16VAC15-90-100. Investigations and enforcement.

A. Investigations. Upon receipt of a complaint from an employee or third party or at the commissioner's discretion, the commissioner may investigate any alleged violations of the Act. A complaint must be filed within the statute of limitations set by § 40.1-33.6:7 of the Code of Virginia.

B. Formal determination of violation. When the commissioner determines that a violation has occurred and a case is not otherwise resolved through mediation or other means, the commissioner will issue a formal determination letter.

1. The employer may request an informal conference with the commissioner within 15 days of receipt of the formal determination letter regarding the findings.

2. The employer's request for an informal conference shall be in writing and include the specific basis for the employer's contestation with any additional documentary evidence the employer wishes the commissioner to consider.

3. The informal conference will result in a decision of the commissioner.

C. Resolution and disposition. When the commissioner issues a formal determination or decision of violation, the employer may resolve the investigation by taking all corrective action determined appropriate by the commissioner, including paying all back wages, damages, and penalties owed. To prevent future violations, the commissioner may require an employer to enter into a compliance agreement as a condition of resolution. Proof of payment or action must be submitted to the commissioner within 15 days of receipt of the determination. In the event that payment and corrective action cannot reasonably be taken within 15 days, the commissioner may approve an extended timeline for an employer to implement all corrective actions and provide proof that the corrective actions were completed. If the employer pays all penalties and takes all corrective action within the deadline, the investigation shall be closed.

D. Final orders. When the commissioner issues a formal determination or decision of violation and the employer refuses to comply or otherwise fails to respond within 15 days of receipt, the decision of the commissioner shall be final. The commissioner may enter a final order against the employer in the appropriate circuit court, refer the matter to the Attorney General, or bring a civil action to enforce the Act.

E. No administrative exhaustion required. An employee is not required to pursue administrative remedies through the commissioner prior to initiating a lawsuit seeking relief for a violation of the Act.

F. Civil monetary penalty assessments. Civil penalties will be determined in accordance with § 40.1-33.6:7 of the Code of Virginia. Civil monetary penalties shall be assessed with consideration of the gravity of the violation, the size of the business, and other factors deemed appropriate by the commissioner.

1. Pursuant to § 40.1-33.6:7 D of the Code of Virginia, no civil monetary penalty shall be assessed and no civil action shall be brought against an employer that, within 15 days of receiving written notice of the alleged violation, corrects the violation by providing affected employees all relief owed to them under the Act and by correcting the employer policies and practices that led to the violation.

2. To ensure that an employer corrects the violation, the employer may be required to enter into a compliance agreement before reducing civil monetary penalties.

3. An employer that commits a repeat violation of the Act shall be assessed a civil penalty under § 40.1-33.6:7 D of the Code of Virginia. Subdivision 1 of this subsection shall not apply to an employer that repeatedly violates the Act because of the employer's prior failure to come into compliance within 15 days.

4. For purposes of this section, an employer receives written notice of an alleged violation when the employer receives a notice from the commissioner or Attorney General, a complaint, a demand letter, or a notice from a labor organization or other interested third party containing a description of the alleged violation.

G. Common law defenses. Causes of action authorized under the Act and awards for successful causes of action under the Act are limited by common law affirmative and equitable defenses, including the common law equitable defense of double recovery.