Sponsors (55)
The bill establishes a national baseline of paid annual leave, transparency, and stronger enforcement to benefit workers, while imposing new costs, administrative burdens, expanded coverage, and increased litigation exposure on employers and public entities.
Low‑ and middle‑income workers (and most employees) will earn paid annual leave at a rate of 1 hour per 25 worked (up to about 80 hours/year) that is usable as accrued, preserves employer‑provided benefits while on leave, protects tipped workers' pay while on leave, and requires payout of unused leave on separation.
Employees (including federal and state workers) will have stronger anti‑retaliation protections and clearer enforcement paths — they are protected from retaliation for using leave or asserting rights, can pursue private lawsuits for back pay, liquidated damages, and equitable relief, can recover attorneys' fees, and the Secretary has investigatory and enforcement authority.
Employees will receive clearer notice and access to leave information (written policies on day one, handbook/posting requirements, and accrual tracking via pay stubs/portal on request) plus public outreach, making it easier to know, monitor, and enforce leave rights.
Small businesses, public agencies, and taxpayers will face higher labor and fiscal costs (from mandated paid leave accrual, payouts on separation, and implementation), which may reduce hiring, raise prices, or increase strain on government budgets.
Employers (especially small employers and government contractors) will incur significant administrative and IT burdens to track accruals, update handbooks and postings, change payroll/pay‑stub systems, retain FLSA‑style records, and respond to subpoenas, increasing compliance costs and operational time.
Very small employers and public entities may become newly covered because of broad 'commerce' definitions and a low numeric threshold, exposing them to new obligations, regulatory complexity, and sector‑specific challenges (including for some carriers).
Based on analysis of 9 sections of legislative text.
Requires covered employers to give paid annual leave at a minimum rate of 1 hour for every 25 hours worked (up to 80 hours per year), lets employees use leave as it accrues, and sets rules for notice, carryover, payout at separation, and recordkeeping. It also forbids retaliation for using leave, creates enforcement tools for the Secretary of Labor and a private right of action for employees, and calls for a public awareness campaign. Establishes definitions for covered employers and employees, specifies which types of leave are excluded from this paid annual leave, preserves stronger state or contractual leave rules, delays application for existing collective bargaining agreements for up to 18 months, and becomes effective 180 days after enactment.
Introduced July 25, 2025 by Seth Magaziner · Last progress July 25, 2025