A: YES, as of April 1, 2014 most NYC businesses must provide paid or, in some cases, unpaid, sick leave. 

UPDATE - ALERT - Since this article was originally published in July 2013, the Earned Sick Time Act has been amended.  The highlights of the amendments are in blue.  The original article setting out the basics of the Act follow thereafter.  GET THE REQUIRED NOTICE OF EMPLOYEE RIGHTS HERE.

The Amended Act applies to private employers with 5 or more employees and employers with 1 or more domestic workers. The original Act applied to private employers with 20 or more employees. The Amended Act exempts small businesses (ie. employers with fewer than five employees) from providing paid sick leave but unpaid sick leave is required.

The Amended Act applies to Manufacturing Employers (certain employers classified in sections 31, 32 or 33 of the North American Industry Classification System).  The original Act did not. Manufacturing Employers and employers with between five and nineteen employees have a six-month grace period before facing civil penalties for violations of the Amended Act.  But, any second or subsequent violation of the same provision of the Act that occurs before October 1, 2014 will be seen as a predicate for imposing penalties for subsequent violations that occur on or after that date.

The Amended Act limits the amount of unused sick time an employee can carry-over each year to 40 hours. The Original Act contained no limit.

The Amended Act requires that by May 1, 2014, notice be given both to current employees and to new hires. The Original Act required notice to new hires only. 

The Amended Act requires employers to retain records of sick leave for a period of three years. The Original Act required retention for two years.  The Amended Act has expanded the definition of "family member" to include siblings (including half-siblings, step-sibling and siblings related through adoption), grandchildren and grandparents.

ORIGINAL ARTICLE -  When will the Act be effective? April 1, 2014 (although depending upon the performance of the economy, the effective date may be pushed to October 1, 2014).

  Does the Act apply to your business? Yes, if you have any employees who are employed within New York City for more than 80 hours in a calendar year on a full-time, part-time, or temporary basis. During the first 18 months after the effective date, private-sector employers (manufacturing and certain other industries excluded) with 20 or more employees will be required to provide paid sick leave to all employees.  Thereafter, those private employers with 15 or more employees and all employers of one or more domestic workers must provide paid sick leave to their employees. Employers that do not employ the requisite number of employees are not required to provide paid sick leave but must still provide employees with unpaid sick leave once the law takes effect.

  What employees are eligible? Subject to certain exceptions, any person employed within New York City for more than 80 hours in a calendar year that performs work on a full-time, part-time basis or temporary basis.

   What are the sick leave benefits?  Covered employers are required to provide one hour of paid sick leave for every 30 hours worked, with a maximum of 40 hours of sick leave per calendar year (special rules apply to domestic workers). Employers that do not employ the requisite number of employees must provide employees with unpaid sick leave earned at the same rate.

   When can sick leave be used? Sick leave accrues at the commencement of employment or the effective date of the Act, whichever is later. Employees can begin using sick leave four months after they start work or after the law takes effect, whichever is later. Employees are entitled to carry over unused, accrued sick leave into the next calendar year but employers are not required to provide more than 40 hours of sick leave per year. In other words, an employee with unused sick leave may use this time during the following year without having to start the accrual process over again but he/she is not entitled to bank this time in order to use more than 40 hours of sick leave in a calendar year (unless the employer permits otherwise). Employers may choose to pay the employee for the unused, accrued sick leave at the end of the calendar year. Upon the employee's termination (regardless of reason), resignation, retirement, or other separation from employment, an employer is not required to pay an employee for accrued but unused sick leave.

   What are valid reasons for sick leave under the Act? Employees can use sick time for their own physical or mental illness or injury or preventive medical care, to provide care for a family member, or because of the closure of a business or school due to a public health emergency.

   What if an employer already has a leave policy? Covered employers that already have or implement paid leave policies will be in compliance with the Act and do not have to provide additional paid sick time if they already provide paid time off sufficient to meet the requirements of the Act, and allow employees to use that leave for the purposes specified in the Act. Similarly, employers required to provide unpaid sick time under the Act, which provide other types of paid or unpaid leave that can be used for the purposes defined in the Act, are not required to provide additional unpaid sick time.

  Must employers give employees notice of the Act? Covered employers will be required to provide a notice of entitlement to leave to employees upon hiring but not to existing employees. Notices should also be posted in a conspicuous location at the worksite.  Click here for the Notice.

  What if an employer violates the law?  Employers may be required to reimburse employees for lost wages and benefits and will subject to fines and penalties (the amount of which depends of the extent of the violation, type of violation and history of prior violations).