House File 19 - Introduced HOUSE FILE 19 BY HUNTER A BILL FOR An Act relating to employee leave by providing for time 1 off and vacation leave, and including effective date and 2 applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1226YH (3) 85 je/rj

H.F. 19 Section 1. Section 91A.2, Code 2013, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 6A. “Paid time off” means a benefit 3 provided by an employer that allows an employee to take time 4 off from work with pay without regard to the reason the 5 employee chooses to take the time off. 6 Sec. 2. Section 91A.2, subsection 7, paragraph b, Code 2013, 7 is amended to read as follows: 8 b. Vacation, holiday, paid time off, sick leave, and 9 severance payments which are due an employee under an agreement 10 with the employer or under a policy or practice of the 11 employer. 12 Sec. 3. Section 91A.4, Code 2013, is amended by striking the 13 section and inserting in lieu thereof the following: 14 91A.4 Employment suspension or termination —— calculation and 15 payment of wages. 16 1. An employee’s employer shall pay all wages earned by the 17 employee up to the time of the suspension or termination, less 18 any lawful deductions specified in section 91A.5, no later than 19 the next regular payday after suspension or termination, except 20 as follows: 21 a. Earned wages that are the difference between a credit 22 paid against wages determined on a commission basis and the 23 wages actually earned on a commission basis shall be paid 24 by the employer not more than thirty days after the date of 25 suspension or termination. 26 b. If while employed, an employee earned paid time off 27 but did not earn vacation, an employer may reduce pay for 28 accumulated paid time off by up to one-third. 29 c. If while employed, an employee earned both vacation pay 30 and paid time off, no payment for accrued paid time off is 31 required. 32 2. An employer shall not adopt a policy or practice of 33 denying payment for vacation or for paid time off upon the 34 suspension or termination of an employee’s employment unless 35 -1- LSB 1226YH (3) 85 je/rj 1/ 3

H.F. 19 the employee’s employment was terminated by the employer for 1 misconduct pursuant to section 96.5, subsection 2, and the 2 rules of the department of workforce development defining 3 misconduct. 4 3. Except as provided in subsection 1, upon suspension or 5 termination of an employee’s employment, the amount of pay owed 6 for accrued paid time off or accrued vacation shall be the 7 amount of pay the employee would have received if the employee 8 had not been suspended or terminated and had begun taking the 9 total amount of accrued paid time off or accrued vacation on 10 the date the suspension or termination occurred. 11 Sec. 4. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 12 immediate importance, takes effect upon enactment. 13 Sec. 5. APPLICABILITY. This Act applies only to the 14 suspension or termination of an employee’s employment that 15 takes place on or after the effective date of this Act. 16 EXPLANATION 17 This bill provides employee leave by providing for time off 18 and vacation leave. 19 The bill relates to payments for accrued vacation time and 20 for accrued paid time off for all employees who are terminated 21 or suspended. 22 Current law requires an employer to pay accrued vacation pay 23 to a terminated or suspended employee only if the employer has 24 a policy, procedure, or contract that requires the employer to 25 do so. 26 The bill defines “paid time off” as a benefit allowing an 27 employee to take time off from work with pay without regard to 28 the reason the employee chooses to take the time off. “Paid 29 time off” is also added to the definition of “wages”. 30 The bill provides that if an employee is suspended or 31 terminated, upon request the employer must pay all earned 32 wages, now including paid time off, by the next regular payday. 33 The bill provides for an employee who earned paid time off 34 while employed but did not earn vacation, that the employer may 35 -2- LSB 1226YH (3) 85 je/rj 2/ 3

H.F. 19 reduce the pay for the accrued paid time off by one-third. For 1 an employee who earned both vacation and paid time off while 2 employed, the employer is not required to make payment for the 3 paid time off. 4 An employer shall not adopt a policy or practice to deny 5 payment for accrued vacation or accrued paid time off upon the 6 suspension or termination of an employee unless the employee’s 7 employment ended due to misconduct. Misconduct is not defined 8 in statute but is defined in the department of workforce 9 development’s administrative rules. 10 The bill provides for the calculation and payment of an 11 employee’s accrued paid time off or vacation if the employee 12 is suspended or terminated. The amount of such pay owed to an 13 employee is the amount of pay equal to the accrued vacation or 14 paid time off as if the employee began taking the vacation or 15 paid time off the day the suspension or termination took place. 16 The bill takes effect upon enactment. The bill is made 17 applicable only to the suspension or termination of an 18 employee’s employment that occurs on or after that date. 19 -3- LSB 1226YH (3) 85 je/rj 3/ 3