The New York City Department of Consumer and Worker Protection (DCWP) adopted final rules to implement recent amendments to the New York City Earned Safe and Sick Time Act (ESSTA). Effective July 23, 2026, the final rules largely adopt the proposed framework but provide additional guidance on administering the expanded leave requirements and add new compliance obligations for employers. Before you finalize your playbook, review a brief recap of recent ESSTA developments and key changes under the final rules.
RECAP OF ESSTA DEVELOPMENTS
On February 22, 2026, amendments to the ESSTA took effect, which:
- Expand qualifying reasons for leave;
- Establish a new 32-hour bank of immediately available unpaid leave;
- Require employers to provide 20 hours of paid prenatal leave during any 52-week calendar period; and
- Transfer obligations under the Temporary Schedule Change Act to the ESSTA.
For additional details, see HERE.
Ahead of the effective date, the DCWP issued updated materials to assist employers with administration and compliance with the amended law. In addition to a set of Frequently Asked Questions providing guidance on the new protections and requirements, and a revised Notice of Employee Rights for distribution and posting, the DCWP also issued proposed rules to implement the changes.
For additional details, see HERE.
Among other things, the proposed rules:
- Rename “Safe/Sick Time” to the broader term “Protected Time Off”;
- Require employers to include additional information in their written safe/sick leave policies regarding the 32-hour unpaid leave bank;
- Require employers to include additional information on pay statements regarding the 32-hour bank of unpaid leave;
- Require employers to maintain pay-period records for each employee showing protected time off used and accrued, the employee’s total balance, and the amount available for use;
- Require employers to record the amount of paid prenatal leave used and available in a pay period;
- Clarify that where an employee has both paid and unpaid protected time off available, employers must apply paid protected time off unless the employee requests otherwise;
- Provide that employers offering PTO in excess of ESSTA requirements may use the excess PTO to fulfill the 32-hour unpaid leave requirement;
- State that employers are not required to carry over unused immediately available hours of unpaid protected time off;
- State that protected time off documentation is considered reasonable if it shows the reason for the amount of time taken; and
- Clarify penalties for the failure to provide unpaid leave under the 32-hour bank and/or paid prenatal leave.
For additional details, see HERE.
KEY CHANGES UNDER THE FINAL RULE
While the final rule largely adopts the proposed framework, it provides additional administrative guidance and imposes new compliance obligations for employers.
Expanded Electronic Pay Statement Notice Requirements to Post-Employment
Proposed: Employers using an electronic system to issue pay statements or other documentation related to protected time off or paid prenatal leave can comply with notification requirements by (1) electronically notifying the employee each pay period that the required information is available; (2) making the information readily accessible outside the workplace within the electronic system; and (3) maintaining accrual, use, and balance information for past pay periods in the electronic system such that it is readily accessible outside the workplace.
Adopted: The final rule retains and expands on these requirements by:
- Clarifying that the third requirement applies “during the employee’s tenure”; and
- Adding that the employer must either (1) continue providing employees with access to the electronic system for six months after their tenure ends, OR (2) provide a written statement containing required leave information for their last pay period no later than one week after their final payday.
Provided (Much Needed) Guidance on the 32-Hour Unpaid Leave Bank
Proposed: Employers may fulfill their obligation to provide 32 unpaid immediately available hours by providing an equivalent amount of paid protected time off (with 32 hours immediately available on the first day of employment and on the first day of each calendar year).
Adopted: The final rule retains this concept and clarifies that:
- Employers may provide some or all of the 32 hours as an equivalent amount of paid protected time off;
- Employers should provide paid leave when necessary to comply with other legal obligations, or to satisfy the salary basis requirement for an overtime exemption under state or federal law;
- Providing paid immediately available hours does not affect an employer’s separate obligation to provide paid protected time off under the ESSTA’s accrual or frontloading requirements; and
- At least 32 hours of protected time off, whether paid or unpaid, must be immediately available on the first day of employment and on the first day of each calendar year.
New Reinstatement-of-Hours Obligations for Rehired Employees
The final rule adds a new provision requiring employers to reinstate an employee’s unused portion of the immediately available 32 hours of unpaid protected time off if the employee separates from employment and is rehired within the same calendar year. This obligation applies in addition to the ESSTA’s existing requirement to reinstate accrued protected time off for eligible rehired employees.
EMPLOYER TAKEAWAYS
Before the final rules take effect on July 23, 2026, employers should consider the following action steps:
- Update ESSTA policies and procedures to incorporate the final rules, including administration of the 32-hour immediately available leave bank, paid prenatal leave, and reinstatement obligations for rehired employees.
- Review payroll systems and pay statement practices to ensure protected time off balances, paid prenatal leave information, and required electronic access and post-employment record availability comply with the final rules.
- Audit leave administration procedures to confirm that paid and unpaid protected time off is administered in the correct order and that at least 32 hours of immediately available protected time off is provided as required.
- Update rehire procedures to ensure eligible employees rehired within the same calendar year receive reinstatement of unused immediately available protected time off, in addition to any accrued protected time off required under the ESSTA.
- Train HR, payroll, managers, and leave administrators on the final rules, including the new notice, pay statement, recordkeeping, and leave administration requirements.
If you have any questions related to the ESSTA amendments or final rules, or need assistance reviewing safe and sick time policies, please reach out to the NFC Attorney with whom you typically work or call us at 973.665.9100.