In September 2015, President Obama signed executive order 13706 requiring companies that enter into covered contracts with the Federal Government to provide covered employees with up to 7 days of paid sick leave annually. They are also required to allow this sick leave to be used for family care. Late last month the Department of Labor issued the rules for this change. 
This rule takes effect December 1, 2016. The order specifically requires the government to require contractors to include a clause in their lower-tier subcontractor agreements enforcing this rule and making it a condition of payment. The rule requires that employees “earn not less than 1 hour of paid sick leave for every 30 hours worked.” Further, contractors may not receive credit toward prevailing wage or fringe benefits obligations for any sick leave. Sick leave earned must be allowed to carried over from one year to the next. Employers are NOT required to pay unused sick leave upon separation, but if the employee returns within 12 months their forfeited sick leave must be reestablished.
It is very easy for subcontractors to get tripped up by these rules. Make sure you understand your contractual agreements and be ready to comply with this expanded regulation.
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