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Statutory definition does not reference municipalities, boards of education or political subdivisions, leaving room for interpretation under Public Act 24-8

Arguably the most significant labor and employment development arising out of the 2024 session of the Connecticut General Assembly was the dramatic expansion of Connecticut’s existing mandatory paid sick leave law.  As our colleague Melinda Kaufmann discussed in detail in an earlier post, effective January 1, 2025 Public Act 24-8 greatly expands the scope of paid sick entitlements for Connecticut employees. 

Most notably, the Act eliminates existing provisions in the law limiting paid sick leave to “service workers” thereby effectively applying the law to all types of employees.  In addition, the Act phases down the existing 50 employee threshold for employer coverage over a three-year period by first reducing the employer-coverage threshold to 25 or more employees effective January 1, 2025, eleven or more employees effective January 1, 2026 and finally one or more employees effective January 1, 2027.  The Act accelerates employee sick leave accrual, expands employee eligibility to care for family members and (most controversially) generally prohibits employers from requiring their employees to provide documentation substantiating the need for paid sick leave.

While the expanded leave protections of the new law are dramatic enough, on the way to passing Public Act 24-8 the General Assembly appears to have (inadvertently?) opened the door to a major question:  Does Connecticut’s expanded paid sick leave law actually apply to public-sector employers, including municipalities and boards of educations?  For the reasons explained below, the answer is less than crystal clear, and we think that until there is binding court decision or a legislative fix addressing the issue, public-sector employers should carefully assess their own legal risk-tolerance in deciding whether and how to implement the changes to the law and should be cautious before adopting wholesale changes to collective bargaining agreement language or existing sick leave practices based upon the assumption that the new law definitely applies to their workplace. 

The Definition of “Employer”

Since paid sick leave for “Service Workers” was first adopted by the General Assembly with the passage of Public Act 11-52 back in 2011, the fundamental definition of the term “employer” for purposes of paid employee sick leave in Connecticut has remained constant.  Under that law, and carrying forward to the passage of Public Act 24-8, an “employer” is defined as “any person, firm, business, educational institution, nonprofit agency, corporation, limited liability company or other entity . . .” that employs the requisite number of employees to be subject to the law – an amount that, as noted above, will decrease over the course of the next three years from the current threshold of 50 employees to a single employee by January 1, 2027.  Public Act 24-8 tinkers around the edges of this definition by eliminating an explicit exemption for nationally chartered 501(c)(3) organizations ( e.g. groups like the YMCA) and by adding a catch-all exemption for employers that participate in multiemployer health plans (e.g. unionized construction companies), but it does not alter the fundamental definition.

Significantly the definition of “employer” for purposes of paid sick leave does not explicitly include -- or exclude -- boards of education or municipalities, either directly or by reference to political subdivisions of the state.  This is notable – and perhaps revealing – since a number of other Connecticut employment statutes – including recently passed laws – do in fact specifically either include or exclude such public-sector entities from the scope of coverage.  For example, Connecticut statutes regarding employee free speech protections (Conn. Gen. Stat. § 31-51q), workplace leave for victims of family violence (Conn. Gen. Stat. § 31-51ss), the use of polygraph testing in employment (Conn. Gen. Stat. § 31-51g) and the use of employee credit history checks (Conn. Gen. Stat. § 31-51tt) all specifically reference “political subdivisions of the state” as covered employers.  Similarly, Connecticut’s Fair Employment Practices Act (Conn. Gen. Stat. § 46a-60, et seq.) uses a definition of “employer” that explicitly includes political subdivisions of the state thereby applying the law’s anti-discrimination obligations to boards of education and municipalities.  Likewise, Connecticut’s electronic employee monitoring law (Conn. Gen. Stat. § 31-48d) specifically includes municipalities and boards of education within the definition of a covered “employer.”

The reverse is also true. Connecticut paid family and medical leave, which was enacted in 2019, explicitly excludes municipalities and boards of education as covered employers unless the municipality or board of education negotiates for inclusion in the program with a particular bargaining unit.  

The text of Connecticut’s paid sick leave law does neither: it does not specifically include political subdivisions, municipalities, boards of education or other public-sector employers within the definition of “employer,” nor does it specifically exclude them from coverage.  While the law does state that “educational institutions” are covered employers it does not define what an “educational institution” actually is under the law (could an “educational institution” for purposes of paid sick leave only be a private-sector educational institution or does the term include public educational institutions?), and even if boards of education, charter schools, regional educational service centers (and the like) qualify as covered educational institutions it is unclear how exactly municipalities would fall within the scope of coverage (perhaps as “other entities?”).    

The fact that the statutory definition does not reference municipalities, boards of education or political subdivisions leaves room for interpretation under Public Act 24-8.

Public Act 24-8’s Legislative History

The legislative history for Public Act 24-8 seems to suggest that expanded paid sick leave benefits for public-sector employees were not even contemplated by members of the General Assembly when they took up the underlying bill.  In the 553 pages of transcripts from the House and Senate debates on the bill there is no direct reference to the potential impact on boards of education or municipalities, much less debate over whether paid sick leave should be granted to or expanded for public-sector employers. 

This may not be surprising, however, given the fact that when the General Assembly passed Public Act 24-8 on May 6, 2024 it presumably did so on at least partial reliance on two pieces of guidance.  The first was the General Assembly Office of Legislative Research’s (OLR” analysis of the bill that ultimately became Public Act 24-8.  That analysis was issued on April 25, 2024 and stated among other things that the bill as proposed would expand paid sick leave by “covering nearly all private sector employees and employers with at least 25 employees in 2025, those with at least 11 employees in 2026, and then those with at least one employee in 2027 . . .”.  No mention is made in the OLR analysis of potential impact to public-sector employers and employees.  The bill analysis issued by OLR on April 25 then became the basis of the final act summary of Public Act 24-8 that was issued by OLR after Public Act 24-8’s final passage and also indicates that the new law only applies to private-sector employers.

The second piece of guidance was the General Assembly Office of Fiscal Analysis’ (OFA) “fiscal note” for the final bill that was passed by the General Assembly.  Under the law, OFA is statutorily required to address the potential impact on municipalities on pending legislation before it is taken up for final passage.  In most circumstances OFA goes to great lengths to include any and all conceivable fiscal impacts of a piece of legislation before final passage so that legislators have a complete understanding of the potential municipal impact of legislation that they are being asked to vote on.  For example, with the passage of Public Act 24-41 – “An Act Concerning Educator Certification, Teachers, Paraeducators and Mandated Reporter Requirements,” OFA’s fiscal note describes the consequential financial impact on boards of education of a provision in Public Act 24-41 that effectively lowers the hours-worked threshold for FMLA eligibility for non-certified board of education employees from 1,250 hours to 950 hours by noting potential overtime costs to boards of education in having to cover the hours of employees on FMLA as a result of the change.  The fiscal note for Public Act 24-8 includes no such description – even though the fiscal impact would be similar in nature.  It simply says that there is no municipal impact, which of course would seem to indicate that municipalities do not fall within the law – at least in OFA’s estimation.

While the OLR bill summary and OFA fiscal note are not dispositive of legislative intent, it is hard to imagine that they did not have an impact on the ways in which legislators interpreted the scope of the bill that they were asked to vote on.  To this end, the Connecticut Supreme Court has recognized that OLR bill summaries are not evidence of legislative intent but may have some bearing in determining the General Assembly’s awareness of potential issues that could arise from a particular bill.

DOL Guidance and Prior History

Notwithstanding the open-ended definition of “employer” and Public Act 24-8’s head-scratching legislative history, since paid sick leave for service workers was first introduced in 2011 the Connecticut Department of Labor (DOL) has taken the position that Connecticut paid sick leave applies to public-sector employers.  Very recently for instance, the DOL’s Wage and Workplace Standards Division issued new FAQ guidance indicating that the law applies to both private and public-sector employers as long as the employee thresholds are met. 

While the question of whether a public-sector employer constitutes an “employer” for purposes of paid sick leave has not yet been litigated in Connecticut at either the court or DOL level, the legislative history for the initial paid sick leave act – Public Act 11-52 – includes several references supporting the DOL’s interpretation that the law applies to public-sector employers.

However, just because the DOL has interpreted statutory paid sick leave as applying to boards of education and municipalities does not mean that a court reviewing the issue would automatically accept the DOL’s interpretation of the amended law.  For the DOL’s interpretation to have legal weight there must be a history of either judicial or agency-level decisions supporting the interpretation, and to date there are no cases addressing this issue.  As such, while the DOL’s guidance is important in so far as it indicates how the DOL itself will address paid sick leave it does not have the force of law – at least not at this stage.

The Path Forward?

At this point our take is that Public Act 24-8’s application to public-sector employers has not been conclusively decided.  While the initial legislative history from Public Act 11-52 and the DOL’s subsequent guidance suggest that municipalities, boards of education and other public-sector employers are covered by statutory paid sick leave obligations, Public Act 24-8’s legislative history is anything but clear especially in light of the OLR and OFA guidance. 

Against this backdrop we believe that public-sector entities need to carefully assess their risk tolerance with respect to the new law.  In the public-sector context, virtually all collective bargaining agreements provide overall paid sick leave benefits that far exceed statutory paid sick leave entitlements. So, it may not be necessary for municipalities to rush to integrate each and every component of the new sick leave law by January 1, 2025.  But employers must be aware that the risk of violating the law is a penalty of a $500 civil fine per violation of the Act’s provisions. 

For example, crediting an employee who has already used his entire 2024-25 balance of sick leave by December 31, 2024 with five more days of sick leave on January 1, 2025 in order to ensure strict compliance with Public Act 24-8’s terms may not be worth the risk of a $500 penalty if the same employee will be credited with a new allotment of contractual sick leave on July 1, 2025 (assuming that the collective bargaining agreement expires on June 30).  To this end, the administrative cost involved in crediting paid sick leave to ensure compliance with all of the nuanced provisions of Public Act 24-8 when existing collective bargaining agreement language typically provides more generous leave amounts – albeit without the exact same accrual and use rights – cannot be eliminated.  So the employer must make a cost-benefit analysis regarding this risk.

Moreover, as public-sector HR administrators and managers know all too well, the use and abuse of sick leave is a seemingly never-ending problem.  The ability to require medical documentation to support a request for leave when appropriate is one of the few tools public-sector employers have to fight sick leave abuse (and to control sub costs), so to simply give up the right to request documentation where appropriate based upon ambiguous legislative language is a significant concession. But other laws (such as FMLA), may ameliorate this dilemma.

While as always employers should proceed with significant caution when facing personnel decisions -- especially since the paid sick leave law provides for remedies beyond a civil penalty, such as reinstatement, back pay and the restoration of benefits for employees who are terminated in violation of the statute -- the risk of a $500 civil fine, in and of itself, may not justify turning a blind eye to abuse of sick leave.

When the General Assembly reconvenes next year, we may get more clarity on the applicability of paid sick leave to public-sector employers.  Until that time, public-sector employers should carefully assess their risk tolerance and may want to take a “wait and see” approach before revamping all sick leave polices and procedures to comply with each and every facet of the new law.

For those who do not wish to take this risk and instead seek to comply with the new paid sick leave law, please see our prior materials on the law’s requirements and please contact an attorney with our firm.