Missouri New Paid Sick Leave Law: What Employers Need to Know

As Missouri prepares to implement new paid sick leave regulations, businesses need to understand and plan for how these changes will impact operations and employee benefits. With the passage of Proposition A, Missouri employers are now required to provide paid sick leave benefits to all Missouri employees. Employers will now need to establish paid sick leave policies that comply with the regulations accrual rate requirements, balance limits, and other specifics set fourth in Proposition A.

Along with the requirement of paid sick leave, Proposition A also initiates an increase to the Missouri state minimum wage, raising the amount to $13.75 per hour on January 1, 2025, followed by an increase to $15 per hour in 2026.

As we break down the key elements of the law and what steps employers should take to ensure compliance, please note that government entities such as school districts and other public institutions are exempt from Proposition A requirements.

Accruals and Balance Limits

Beginning on May 1, 2025, or day one of employment, whichever is later, Missouri employees will start earning paid sick leave at an accrual rate of one hour for every 30 hours worked. For a regular full time employee that is almost 70 hours annually. However, employers can choose to implement an annual usage of paid sick leave limit based on the organization size:

For businesses with 15 or more employees, employers can limit workers to use up to 56 hours of paid sick leave per year.
For smaller businesses with fewer than 15 employees, the employer cap may be set at 40 hours of paid sick leave annually.

These limits are in place to help balance employee benefits with the operational realities of running a business, but employers need to ensure that policies are clear and consistently applied.

Frontloading as an Option

For companies that choose to provide all the paid sick leave time at the beginning of a plan year, frontloading the paid sick leave hours is another option. This means providing employees with their full annual allotment of sick leave at the beginning of the year, instead of accruing it throughout. By frontloading, employees can use all of the hours immediately, and not as they are earned. Before taking this step, employers should consider how many hours an employee is anticipated to work and upcoming schedule changes. Once hours are granted to an employee they cannot be revoked.

Unused Leave and Carryover Rules

One key aspect of the new law is how unused paid sick leave is handled. Employers have two options:

Allow employees to carry over up to 80 hours of unused paid sick leave into the next plan year.
Pay out the remaining unused sick leave time at the end of the plan year as long as hours for the next plan year are frontloaded and available for immediate use.

If employers choose to allow employees to carry over up to 80 hours of unused sick leave from one year to the next, the paid sick leave balance can be capped at 80 hours. For example, say an employee has about 60 hours of unused paid sick leave. If the employee does not use any of those hours, the full 60 hours will carry over. The following year, if they accrue another 60 hours but use none, employers can limit the total carried-over balance to 80 hours, helping control the accumulation of leave.

Separation of Employment: What Happens to Unused Leave?

Employers also need to be aware of how accrued unused paid sick leave is handled when an employee separates from the company. Under the new law, employers are not required to pay out unused sick leave upon an employee’s resignation or termination. However, if an employee is rehired within 9 months, their previously accrued leave must be reinstated and available for use as of day 1 of employment. This reinstatement clause means that businesses need to carefully track leave balances and document separations to remain compliant if a former employee returns. Records on paid sick leave accruals and use of time must be kept for a minimum of three years.

paid, business, document, paid sick time, earned paid sick time, employer's payroll system, mental or physical illness

Use of Paid Sick Leave: What Qualifies?

The Missouri paid sick leave law is designed to offer broad protections for workers, and employees can use paid sick leave for a variety of reasons. These include:

Personal Health Needs: Employees can use sick leave for their own medical or mental health care, whether it’s for preventive care or treatment for an illness or injury.
Caring for Family Members: Paid sick leave can also be used to care for a family member, such as a child, spouse, or parent, who needs medical attention or support.
Public Health Emergencies: During public health crises, such as a declared pandemic, employees can use sick leave if their workplace or their child’s school or daycare is closed.
Domestic Violence Leave: The law also includes provisions for employees experiencing domestic violence, allowing them to use paid leave to seek medical attention, relocate, or access related services.

Employers should ensure their policies are comprehensive and cover these scenarios to avoid legal complications and support their workforce effectively. Employees are able to request use of paid sick leave either verbally, in writing or by electronic means acceptable by the employer. When possible, policies may state that employees provide the expected duration of the absence. For absences of 3 or more consecutive workdays, employers may require reasonable documentation.

Next Steps for Employers: Preparing for Compliance

With the May 1, 2025, implementation date approaching, here are some proactive steps employers can take:

Review Current PTO and Sick Leave Policies: Assess your existing policies to determine if they meet or exceed the new requirements. If you already provide PTO that covers at least as much leave as mandated, you may be able to maintain your current policy with minor adjustments.
Update Employee Handbooks: Ensure that your employee handbooks and training materials clearly explain the accrual rates, limits on use, carryover rules, and acceptable reasons for taking leave. Consistency in communication will be crucial.
Implement Tracking Systems: Accurate tracking of sick leave accrual and usage is essential. Consider investing in or upgrading your payroll software to automate calculations and generate reports. This can reduce administrative burdens and ensure you remain compliant.
Train Managers and HR Staff: Supervisors and HR professionals should understand the new requirements and be prepared to answer questions from employees. Training sessions can help ensure policies are implemented fairly and without unintended discrimination.
Communicate Changes to Employees: Clear and transparent communication is key. Hold meetings or send out comprehensive updates to explain the new policies and how they will affect employees. Providing examples and FAQs can be particularly helpful.

Final Thoughts

The introduction of paid sick leave in Missouri represents a significant change, especially for businesses that haven’t previously offered this benefit. While the new law presents challenges, it also offers opportunities to build a healthier and more resilient workforce. By preparing now, employers can smoothly transition into compliance and avoid potential legal pitfalls.

At HireLevel, we understand how complex payroll and HR compliance can be. Our team of experts is ready to assist your business in adapting to these changes, from updating your payroll systems to offering strategic guidance. Reach out to learn how we can help you manage paid sick leave effectively and keep your business moving forward.

sick, pet, flu, unpaid earned sick time, labor and industrial relations

Additional Resources

Blogs:

Webinars:

Watch On-Demand: How to Avoid Payroll Penalties & Ensure Compliance
Upcoming demo: Missouri New Paid Sick Leave Mandate: Is Your Business Ready?
Upcoming webinar: Is Your Employee Handbook Ready for 2025?

HR Compliance Quick Video Tips: