‘PTO Act’ would require employers to grant annual paid leave for any reason

On July 25, members of Congress reintroduced a bill that would require employers to give employees accrued paid time off each year. If enacted, the Protected Time Off (PTO) Act (HR 4763) would:

• Provide employees who work full-time with a minimum of 80 hours (two weeks) of paid leave per year. They could use the time for any reason, and it’d be paid at their regular wage.
• Be in addition to any paid sick leave or family and medical leave already guaranteed by federal, state, or local law.
• Protect employees against discrimination for exercising their right to take annual paid time off.

Employees would accrue one hour of paid time off for every 25 hours worked. They would begin accruing the leave upon hire. For purposes of accrual, exempt employees would be deemed to work 40 hours per week. Employers may allow employees to carry over up to 40 hours of unused time.

If passed into law, the bill allows employees to use their time off as it’s accrued. They could use it in hourly increments, or the smallest time the employers’ payroll system uses to account for absence or use of other time, whichever is smaller.

Much like other protected leaves, employers would need to continue employees’ benefits during their time off.

Employees would need to give notice of the leave, but employers couldn’t require the notice more than two weeks in advance. Employers would need to notify employees about their expectations regarding leave notice well ahead of time, possibly in a handbook.

Employers could deny paid time off for a bona fide business reason, but only if they provide reasonable alternative times. Employers would have to give employees a denial notice within five business days, which includes the reason and an alternative time.

Pay

Employees would be paid their regular pay rate during the paid time off. Tipped employees would be paid the higher of:

• The federal minimum wage,
• The applicable state minimum wage,
• The applicable local or municipal minimum wage,
• Any other wage required by law, or
• The employees’ regular wage.

Employers would need to pay out any unused paid time off upon separation, whether the employee resigns or is terminated.

No need to act now

This bill is in the first legislative stage and has been referred to the Committees on Education and Workforce, House Administration, Oversight and Government Reform, the Judiciary, and Transportation and Infrastructure. Despite having little chance of being passed, this bill is another reminder that members of Congress are interested in employee leave.