October 14, 2019

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Congress Tackles Federal Paid Leave with Flexible Work Standards Bill

U.S. Representative Mimi Walters (R-CA) last week introduced bill H.R. 4219, "Workflex in the 21st Century Act," which, if passed, will create a voluntary program through which employers can opt to offer employees a predetermined amount of federal paid-leave and flexible-work (workflex) arrangements. Most importantly, however, the legislation preempts a participating employer's obligations under existing state and local paid leave and workplace-flexibility laws.

The Act would amend Section 3(1) of the Employee Retirement Income Security Act (ERISA) to create a new type of ERISA-governed plan: the qualified flexible workplace arrangement plan. This plan would need to provide at least a certain level of paid-leave benefits and include at least one flexible-work arrangement from a specified list. The Act aims to create plans that can take advantage of ERISA's preemption of state and local laws, with the goal of allowing multi-state employers the ability to establish a relatively uniform set of paid-leave and flex-time policies that are not subject to a patchwork of different regulatory requirements.

However, a qualified flexible workplace arrangement plan would be governed by ERISA—and as such, it would need to comply with standard provisions for such matters as documentation, reporting, disclosure, and fiduciary responsibility, and would be subject to ERISA's enforcement provisions.

The full extent of ERISA's preemption may yet need to be determined. Several states and many localities have adopted paid leave and workplace flexibility laws, including both paid- and unpaid-leave mandates. It is not clear whether adoption of a compliant qualified workflex plan would trigger preemption of state and local unpaid leave laws, such as family leave, or if it would only preempt paid leave laws. Also, nothing in the bill modifies an employer's obligation to comply with the federal Family and Medical Leave Act (FMLA). However, the bill states that employers could require federal paid leave to run concurrently with FMLA leave.

Paid Leave. The amount of paid leave an employer must offer under the Workflex Act is determined by the size of the employer and the tenure of the employee, as outlined in the table below. All employees would be entitled to paid leave after 90 days of employment. Part-time employees would be entitled to paid leave, but would receive a prorated amount based on the number of hours worked per week.

Minimum Number of Compensable Days of Leave per
Plan Year

Number of Employees

Employees with 5 or more years of service as of the beginning of the plan year

Employees with less than 5 years of service as of the beginning of the plan year

1,000­­+

20 days

16 days

250–999

18 days

14 days

50–249

15 days

13 days

Less than 50

14 days

12 days

Employers would be permitted to apply up to six federal or state holidays towards the paid leave requirement. In addition, an employer may offer paid leave to employees as a lump sum at the beginning of the year or allow employees to accrue paid leave throughout the year. Employers "may permit" accrued leave to roll over year to year and to be cashed out upon termination—these provisions are not mandated. An employer opting to comply with the Workflex Act would satisfy paid leave requirements for federal contractors.

Flexible Work Options. In addition to paid leave, compliance with the Act requires an employer to offer at least one of the following workflex options of their choosing to employees with at least one year of service and 1,000 hours worked:

  • Compressed work schedule (that allows employees to increase their daily hours to work a four-day workweek);

  • Bi-weekly work program (that allows employees to work a total of 80 hours over a two-week period);

  • Telecommuting program;

  • Flexible scheduling; or

  • Predictable schedules.

The bill is supported by the Society for Human Resource Management. It has been referred to the U.S. House Committee on Education and the Workforce. We will continue to monitor the bill as it moves through the legislative process and provide updates.

Copyright © by Ballard Spahr LLP

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Brain Pedrow, Ballard Spahr law firm, employment, labor, and employee benefit dispute lawyer
Partner

Brian D. Pedrow is the Practice Leader of Ballard Spahr's Labor and Employment Group. He represents employers and management in the full scope of matters related to employment, labor, and employee benefit disputes. Mr. Pedrow's practice includes all facets of employment-related litigation, such as discrimination, harassment, retaliation, breach of contract, and employment-based torts. He also has a significant practice representing benefit plans, fiduciaries, and plan sponsors in Employee Retirement Income Security Act (ERISA) litigation arising from benefits eligibility...

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Mary Cate Gordon, Ballard Spahr Law Firm, New Jersey, Labor and Employment Litigation Attorney
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Mary Cate Gordon represents employers in all aspects of labor and employment law. Her employment litigation experience includes defending wage and hour, harassment, discrimination, retaliation, breach of contract, unfair competition, and wrongful termination claims. Ms. Gordon counsels employers on workplace issues such as hiring and discharge matters, reductions in force, wage and hour compliance, drug testing, and disability accommodations. She has experience assisting employers with drafting and reviewing workplace policies and agreements, including social media policies, employment agreements, and separation agreements.

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Shaina Hicks, Ballard Spahr Law Firm, Philadelphia, Employment Litigation Attorney
Associate

Shaina E. Hicks represents public and private employers in employment litigation involving claims under federal and state law. Her practice focuses on counseling employers on a wide range of labor and employment issues. In addition, Ms. Hicks also counsels public and private employers on traditional labor law issues and has experience working on interest arbitration, grievance arbitration, and collective bargaining negotiation.

Ms. Hicks regularly advises clients in matters involving discrimination, whistleblower complaints and retaliation, wage...

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Anu Thomas, Ballard Spahr Law Firm, Philadelphia, Labor and Employment Litigation Attorney
Associate

Anu Susan Thomas is an associate in the Litigation Department and a member of the firm’s Labor and Employment Group. While in law school, Ms. Thomas was a summer associate at Ballard Spahr, and a Philadelphia Diversity Law Group summer associate in the Office of University Counsel at Temple University, where she conducted legal research and drafted documents that addressed employee, faculty, and general university issues. She also served as an education and community outreach field officer and project manager at the Profugo Organization in South India, where she...

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