Effective July 1, 2017, the Fair Wages and Healthy Families Act, also known as Proposition 206, requires most private and municipal employers to provide paid sick time (PST) to employees (A.R.S. Sec. 5-23-371 et seq.).

Covered employers. Nearly all private employers are covered by the law. A limited exemption is provided for “small businesses,” which are those with annual gross revenues below $500,000 that are not engaged in interstate commerce or the production of goods for interstate commerce.

Covered employees. Employees include “any person who was or is employed by an employer.” Part-time and temporary workers are also covered by the law and are entitled to accrue and use PST. In calculating the number of employees performing work for a covered employer, all employees performing work during a given week should be counted (including part-time and temporary workers).

The law does not apply to employees covered by a collective bargaining agreement (CBA) in effect before July 1, 2017. For CBAs entered into or expiring after July 1, 2017, the law’s requirements may be expressly waived by clear and unambiguous language within the agreement.

Accrual of leave. Arizona employees are entitled to a minimum of 1 hour of PST per 30 hours worked.

PST will begin to accrue on July 1, 2017, or the beginning of employment, whichever is later. New hires may be required to wait until 90 days after hire before using accrued PST.

Employers with fewer than 15 employees must permit accrual and use of up to 24 hours of PST per year.

Employers with 15 or more employees must permit accrual and use of up to 40 hours of PST per year.

The Motor Carrier Exemption under the Fair Labor Standards Act (FLSA) section 13(b)(1) is an exemption from overtime for employees over whom the Secretary of Transportation claims authority whose duties affect the safe operation of motor vehicles in interstate transportation. It does not affect minimum wage obligations of the employing motor carrier. Under the Fair Wages and Healthy Families Act these workers are assumed to work 40 hours each work week. Earned but unused PST may be paid or carried over to the following year subject to the 24 or 40 hour limitations noted above.