The Philadelphia Fair Workweek Employment Standards Ordinance ("Ordinance") establishes work scheduling and pay requirements for certain employers in the retail, hospitality and food service industry. This article summarizes some of the pertinent provisions of the Ordinance, which is effective on January 1, 2020.

Affected Employers

The Ordinance applies to retail, hospitality, and food service establishments operating in the City of Philadelphia with 250 or more employees, regardless of where the employees work, and 30 or more locations worldwide. The Ordinance covers all employees who are non-exempt under either state or federal law, including full-time, part-time and seasonal or temporary employees. For employees covered by a collective bargaining agreement, the provisions of the Ordinance can be waived by the inclusion of a clear waiver in the agreement.

Requirements of the Ordinance

When an employee is hired, an employer must provide the employee with a written, good faith estimate of the employee's work schedule, including the average number of hours the employee can be expected to work, and whether the employee can expect to work any on-call shifts. An employee is entitled to make work schedule requests, including requests not to work shifts during certain days or at certain locations, requests not to work on-call shifts and requests for certain hours, days, or work locations.

From January 1, 2020 through December 31, 2020, employers must provide employees with a written work schedule at least 10 days before the schedule begins. Beginning January 1, 2021, employers must provide 14 days notice of the work schedule. Additionally, employers must provide notice of any proposed changes to the schedule prior to the change taking effect, and the written schedule must be revised within 24 hours.

If an employer changes the schedule after the required notice period, the employer must pay the employee "Predictability Pay" above the employee's regular pay. For example, an employee is entitled to one hour of Predictability Pay, at the employee's regular rate of pay, if additional time is added to a work shift or the date, time or location of a work shift is changed with no loss of hours. An employee is entitled to Predictability Pay at half of the employee's regular hourly rate for any scheduled hours the employee does not work if hours are subtracted from a regular or on-call shift or a regular or on-call shift is cancelled.

There are numerous exceptions to the Predictability Pay requirement for instances in which schedule changes occur for reasons beyond an employer's control, including when an employee requests a shift change in writing, severe weather disrupts public transportation or poses a threat to employee safety, a state of emergency, fire, flood, or natural disaster, and threats to employees or the employer's property. Additionally, Predictability Pay is not required when hours are subtracted from an employee's schedule for disciplinary reasons due to a multi-day suspension, provided the incident leading to the disciplinary action is documented.

The Ordinance further provides that an employee may decline, without being penalized, any work hours that are scheduled or occur less than 9 hours after the end of the previous day's shift or during the 9-hour period following the end of a shift that spanned two days. If an employee agrees to work under such circumstances, the employee must provide written consent and the employer must pay the employee an additional $40 for the shift.

Significantly, the Ordinance provides that it is illegal for an employer to interfere with an employee's attempt to exercise any rights granted by the Ordinance. Further, an employer may not take any retaliatory action against an employee as a result of the employee's exercise of any of those rights. In that regard, there is a rebuttable presumption of retaliation if an employer takes any adverse action against an employee within 90 days of the employee's exercise of any rights under the law, unless the adverse action is due to disciplinary reasons, which must be documented in writing. 

Enforcement Provisions

The Ordinance provides an employee may either file a complaint with an agency designated by the Mayor to administer and enforce the law, or file a complaint in court regarding an alleged violation of the law. If the employee prevails in such an action, they shall receive the full amount of any unpaid compensation, including Predictability Pay, any lost wages and benefits, presumed damages (which will be determined by the agency), and an amount up to a maximum of $2,000 as liquidated damages. Additionally, the employee will be entitled to an award of attorneys' fees and costs. Additionally, an employer can be subjected to penalties and fines for violations of the Ordinance. 

Impact on Employers

As detailed above, the Ordinance imposes substantial scheduling requirements, as well as potentially significant pay requirements, on covered employers. Furthermore, due to the potential remedies available to employees in the event of a violation of the provisions of the law, including liquidated damages and attorneys' fees, employers face a significant financial incentive to comply with the provisions of the Ordinance.

To that end, employers should consider updating their policies and procedures to address potential compliance issues. Additionally, employers with union employees should plan to negotiate a waiver of the provisions of the Ordinance in the collective bargaining agreement.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.