New Mexico’s Wholesome Workplaces Act Brings Paid Sick And Protected Time Legislation To The Land Of Enchantment – Employment and HR

On April 8, 2021, New Mexico Governor Michelle Lujan Grisham
signed into law House Bill 20, the Healthy Workplaces Act
(HWA). This law, effective July 1, 2022, will require all private
employers to provide paid leave to employees that they can use for
sick time, safe time, or other reasons for themselves or to care
for or assist a broad list of family members.

Covered Employer, Employees & Family Members

The law will apply to all private employers and to all employees
except employees subject to either Title II (air carriers)
of the federal Railway Labor Act (RLA) or the federal Railroad
Unemployment Insurance Act (RUIA). While the law does not apply to
independent contractors, it expressly prohibits independent
contractor misclassification and provides a sick-leave-related
cause of action and damages for misclassifying workers.

Under the law, covered family members include an employee’s
spouse or domestic partner, other “traditional” family
members like children, grandchildren, grandparents, parents, and
siblings of an employee or the employee’s spouse or domestic
partner, along with an individual whose close association with the
employee or the employee’s spouse or domestic partner is the
equivalent of a family relationship. Note that, unlike some similar
laws, a domestic partner need not be “registered”;
instead, a domestic partner is an individual with whom the employee
maintains a household and a mutual committed relationship without a
legally recognized marriage.

Definition of Year

Whether it’s for accrual, carry-over, or use purposes, most
paid sick and safe time laws use a “year” standard.
Because the standard New Mexico adopts differs from those under
other protected paid leave laws, and more closely resembles a
standard in the federal Family and Medical Leave Act (FMLA), or a
state-level mini-FMLA law, we highlight what a “year”
means under the HWA before covering the law’s other substantive
requirements.

An employer may choose any one of the following methods for
determining the 12-month period in which leave may be used: (a)
calendar year; (b) any fixed 12-month leave year, e.g.,
fiscal year, an employee’s anniversary year; (c) the 12-month
period measured forward from the date an employee first uses leave;
or (d) a rolling 12-month period measured backward from the date an
employee uses any leave. Additionally, under the law, “year to
year,” used in the carry-over provisions, must run
concurrently with the employer’s elected 12-month period.

Amount of Leave

On July 1, 2022 or when employment begins – whichever is later –
employees must accrue at least one hour of sick leave for every 30
hours worked. For accrual purposes, the law assumes employees who
are exempt under 29 U.S.C. Section 213(a)(1) of the federal Fair
Labor Standards Act work 40 hours each week; however, if their
normal workweek involves fewer hours, employers use the normal
workweek for accrual purposes.

Indirectly, the law establishes a 64-hour annual accrual cap;
this comes from a provision that says employers may instead elect
to grant employees the full 64 hours of leave for the upcoming year
on January 1 of each year. From this same provision it appears the
law might permit traditional frontloading, which allows employers,
on the first day of each year, to provide an employee an amount of
leave equal to the annual accrual cap and avoid year-end carry-over
requirements. Currently, all the law says concerning carry-over is
that, at the end of each year, unused leave carries over into the
next year. It is hoped that, before July 1, 2022, the state labor
department clarifies issues concerning caps on accrual (annual and
overall) and carry-over, along with frontloading.

An employer with a paid time off policy that makes available an
amount of leave sufficient to meet the law’s requirements that
may be used for, at minimum, the same purposes and under the same
terms and conditions as the law requires is deemed to comply with
the law. For companies with unionized workforces, the law expressly
says that on July 1, 2022, HWA sick leave is in addition to any
paid time off provided pursuant to a collective bargaining
agreement unless that paid time off may be used for the same
purposes and under the same terms and conditions as the law
requires. The law does not permit companies with unionized
workforces to waive compliance with the provisions of the HWA in
their collective bargaining agreements.

Reasons for Leave

Once they have leave available, employees will be able to use
immediately – i.e., there is no waiting period for new
hires – up to 64 hours of leave each year for the following sick
time, safe time, and other, reasons:

• Mental or physical illness, injury or health condition of
  employee or family member;
• Medical diagnosis, care or treatment of a mental or physical
  illness, injury or health condition of employee or family
  member;
• Preventive medical care for employee or family member;
• Absences due to domestic abuse, sexual assault or stalking
  suffered by the employee or family member to:
  • Obtain medical or psychological treatment or other
    counseling
  • Relocate
  • Prepare for or participate in legal proceedings
  • Obtain services; or
• Meetings at a child’s school or place of care related to
  the child’s health or disability.

Under the law, employees may leave use in hourly increments or
the smallest increment the employer’s payroll system uses to
account for absences or use of other time, whichever amount is
smaller. Notably, the law contains a provision that will appear
familiar to employers subject to COVID-19 emergency paid sick leave
laws: employers cannot require employees to use other types of paid
leave before they use HWA sick leave.

Requesting & Documenting Leave

Employers must provide leave upon the oral or written request of
an employee or an individual acting on the employee’s behalf.
When possible, this request must include the absence’s expected
duration. For foreseeable absences, employees must make a
reasonable effort to notify their employer in advance of use and
schedule use in a manner that does not unduly disrupt the
employer’s operations. For unforeseeable absences, employees
must provide notice as soon as practicable.

Only when employees use leave on two or more consecutive
workdays can employers request “reasonable” documentation
to substantiate the employee used leave for a covered purpose,
which employees must provide in a timely manner. Note that
employers cannot delay the start date for leave based on the fact
an employee has not provided documentation substantiating the need
for leave. For “sick” time purposes, documentation signed
by a health care professional indicating the amount of leave taken
was necessary is reasonable. For “safe” time purposes,
employees can choose to provide a police report, a court-issued
document or a signed statement from a victim services organization,
clergy member, attorney, advocate, the employee, a family member or
other person affirming leave was taken for a covered purpose. A
provision unique to New Mexico’s law is that the signed
statement may be written in the employee’s native language.

Employers cannot require the documentation to explain the nature
of any medical condition or the details of the domestic abuse,
sexual assault or stalking, nor can they require a signed statement
to be in a particular format or notarized. All information an
employer obtains must be treated as confidential and cannot be
disclosed except with the employee’s permission or as necessary
for validation purposes for insurance disability claims,
accommodations consistent with the federal Americans with
Disabilities Act (ADA), as required by the HWA or by court
order.

Rate of Pay

When employees use HWA sick leave, employers must pay the same
hourly rate, with the same benefits, including health care
benefits, as employees normally earn during hours worked, but in no
case less than the applicable minimum wage, which, in New Mexico,
could be the state or, where applicable, local minimum wage,
i.e., in Albuquerque, Bernalillo County, Las Cruces, Santa
Fe (City & County).

Notice, Posting, Recordkeeping & Paystubs

When employment begins, employers must give written or
electronic notice to an employee of the following information: 1)
their right to leave; 2) the manner is which leave is accrued and
calculated; 3) the terms of leave use under the law; 4) that the
law prohibits retaliation against employees for leave use; 5) that
employees have the right to file a complaint with the state labor
department if the employer denies leave or retaliates against an
employee; and 6) all means of enforcing violations of the law.
Additionally, in a conspicuous and accessible place in each
establishment where employees are employed, employers must display
a poster that contains information in the mandatory notice.
Generally, the individual notice must, and the poster should, be in
English, Spanish or any language that is the first language spoken
by at least 10% of the employer’s workforce. Employers can
comply with both requirements via a model notice and poster the
state labor department will create.

Under the HWA, for the immediately preceding 48-month period,
employers must retain records documenting hours worked, and leave
taken, by employees. A law that predates the HWA, New Mexico
Statutes section 50-4-2, requires employers to provide employees a
written receipt that sets forth “the total wages and
benefits earned by the employee.” It is hoped the
state labor department provides clarification concerning what
“benefits earned” means, and whether and how this
interacts with benefits provided pursuant to the HWA.

Prohibitions

Under the law, as a condition of taking leave, employers cannot
require the employee to search for or find a replacement worker to
cover the hours during which the employee is using leave. As noted
above, an employer’s failure to provide leave based on its
misclassification of an individual as an independent contractor is
a violation of the law.

The law contains numerous anti-retaliation protections. For
example, employers cannot take or threaten any adverse action
whatsoever against an employee that is reasonably likely to deter
the employee from exercising or attempting to exercise a right
granted pursuant to the law, or because the employee has exercised
or attempted to exercise such rights, has reasonably alleged
violations of the law, or has raised a concern about violations of
the law to the employer, the employer’s agent, other employees,
a government agency or to the public through print, online, social
or any other media. Under the law, retaliation includes applying an
absence control policy that counts an employee’s leave use as
an absence that may lead to adverse action. Additionally, employers
cannot count leave use in a way that will lead to discipline,
discharge, demotion, non-promotion, less-favorable scheduling,
reduction of hours, suspension or any other adverse action. The law
also prohibits attempting to require employees to sign a contract
or other agreement that would limit or prevent them from asserting
rights under the law or that otherwise establishes a workplace
policy that would limit or prevent exercising such rights.

Enforcement & Damages

Employees will be able to file administrative charges with the
New Mexico Department of Workforce Solution’s Labor Relations
Division. Additionally, individually or on behalf of similarly
situated employees, an employee can file a lawsuit within three
years from the date an alleged violation occurred. Lawsuits can
also be filed by an entity with a member who has been affected by a
violation, the state labor department, and the attorney general.
Employees can be awarded all appropriate legal or equitable relief,
along with costs and expenses of suit and reasonable attorneys’
fees. Moreover, an employer that violates the law is liable to
affected employees as follows:

• Leave Taken but Not Paid: Three times the wages that
  should have been paid or $500, whichever is greater;
• Leave Requested but Denied & Not Taken: Actual
  damages or $500, whichever is greater.
• Replacement Worker: Actual damages or $500, whichever
  is greater.
• Retaliation (Non-Discharge): Actual damages (including
  back pay, wages or benefits lost) plus $250 and equitable relief
  such as rescission of disciplinary measures taken by the employer
  or other relief as determined by a court of law.
• Retaliation (Discharge): Actual damages (including
  back pay, wages or benefits lost) plus $500 and reinstatement or
  other equitable relief as determined by a court of law.
• Willful Notice or Recordkeeping Violation: $250 for
  each violation.
• Independent Contractor Misclassification: Actual
  damages or $500, whichever is greater, for each
  misclassification.

Other Provisions

Like other protected paid leave laws, the New Mexico HWA does
not require employers to cash out unused leave when employment
ends. It does require, however, employers to reinstate this leave
to employees rehired within 12 months of employment ending.
Additionally, the law addresses paid leave banks when employees
transfer or remain employed with a successor employer that takes
the place of their original employer.

No (Legal) Effect on Local Laws

Although the New Mexico HWA establishes minimum paid sick and
safe time standards statewide, it does not prohibit similar local
laws, such as the mandatory paid time off (PTO) ordinance affecting
unincorporated areas of Bernalillo County. It remains to be seen
whether the county will continue its ordinance after the state law
takes effect on July 1, 2022, given the state law requirements in
many respects exceed the county mandate. Many expect the state law
to have an effect, however, on a proposed paid leave ordinance in
Albuquerque. For months – most recently on April 5 – the
Albuquerque City Council has delayed its vote on proposed ordinance
O-20-39, waiting to see whether the state
would enact HB 20. Now that it has, when back in front of the city
council on April 19, members may vote to disregard the
proposal.

Next Steps

Employers will have more than one year before the law takes
effect. During this interim period, they should monitor the state
labor department’s website for guidance and proposed rules to
implement the law. Those with operations located in unincorporated
areas of Bernalillo County should also monitor county webpages for
guidance concerning the impact, if any, the statewide law will have
on the pre-existing mandatory PTO ordinance. We hope that as July
1, 2022 nears, there will be a more complete picture of the law,
providing employers more information and whether and how they must
implement or revise their paid leave, and related policies,
practices, and procedures, particularly if they operate in multiple
jurisdictions with varying paid leave laws.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.