Community Associations Update - September 2014

Date: September 3, 2014

Is Your Community Association Sick Leave Policy in Compliance with District of Columbia Law?

By: Tiffany M. Releford, Esq.

In November 2008, the District of Columbia enacted the Accrued Sick and Safe Leave Act of 2008 (“ASSLA”) which requires employers to provide paid sick leave to employees, as well as safe leave for absences related to domestic violence or sexual abuse.  Effective March 2014, ASSLA was amended by the Earned Sick and Safe Leave Amendment Act of 2013 which broadens the employees covered under ASSLA, provides for additional recordkeeping, and includes stronger remedies for violations of the law. 

What is required under ASSLA?  Prior to the amendment to ASSLA, community associations had to provide paid sick leave to eligible employees for absences related to physical or mental illness, preventative medical care, caring for a family member, domestic violence, sexual abuse, or stalking.  Previously, the term “employee” was defined as an individual who has been employed by the same employer for at least one year without a break in service and who has worked at least 1,000 hours of service with such employer during the previous 12-month period.  However, the amendment to ASSLA has re-defined employee to be any individual, whether part-time or full-time, and eliminated the requirement for any length of time of employment.  In addition, temporary employees, even if hired through a staffing agency, are now defined as employees under ASSLA.  This is significant as many associations’ sick leave policies generally do not apply to part-time employees; however, the amendment to ASSLA provides that employers must provide part-time employees with paid sick and safe leave.  This means a community association must allow all employees to accrue sick leave beginning on their first day of employment; however, the employer may prohibit the employee from using the leave until after the first 90 days of employment. 

How are sick and safe leave determined?  The amendment did not change the method of determining the sick and safe leave to be provided to employees.  The amount of sick leave to be provided is still determined by the number of employees.  A community association with 100 or more employees in D.C. shall provide each employee not less than one hour of paid leave for each 37 hours worked, not to exceed seven days of paid leave per calendar year.  An association with 25 to 99 employees in D.C. must provide each employee with not less than one (hour paid leave for every 43 hours worked, not to exceed five days of paid leave per calendar year.  Lastly, an association with 24 or fewer employees in D.C. shall provide not less than one hour of paid leave for every 87 hours worked, not to exceed three days of paid leave per calendar year. 

Can employees carry over unused leave accrued under ASSLA?   Previously under ASSLA, an employee could carry over unused paid leave annually, but could not use in one year more than the maximum annual hours accrued under ASSLA.  This provision has now been deleted from the law.  Therefore, employees no longer have an annual cap on use of sick and safe leave.  This means associations with “use it or lose it” sick and safe leave policies cannot apply those policies since the language of the statute no longer restricts sick and safe leave.   However, although an association cannot cap the leave, the association is not required to pay employees for accrued but unused sick and safe leave upon termination.   

What is required of employers and employees under ASSLA?  Community associations are still required to post notices regarding ASSLA in conspicuous places.  In addition, the amendments did not change the notice employees are required to give before taking sick or safe leave.  An employee is expected to give at least ten days written notice of the employee’s intent to use sick or safe leave.  In the event 10 days’ notice cannot be given, employees should make an oral request for leave prior to the start of the employee’s work day or, in the case of an emergency, prior to the start of the employee’s next work day or within 24 hours of the onset of the emergency.  Despite when notice is provided by the employee, the employer may request “reasonable certification” for paid leave absences of three or more consecutive days.  Such certification may include a signed document from a health care provider affirming the illness, or a police report or court order indicating the employee or the employee’s family member was a victim of stalking, domestic violence, or sexual abuse. 

What if an employer already has a leave policy in place?  While ASSLA applies to all employers, if a community association already has a paid leave policy or universal leave policy in place which allows for the accrual and usage of leave that is equivalent to the paid leave described in ASSLA, it is not required to modify the policy.

Are there any penalties for violation of ASSLA?  Under the amendment, an employee now has a private cause of action or administrative action for violation of ASSLA.  There is a three-year statute of limitations for civil complainants but the limitations period is tolled if an employee files an administrative complaint within 60 days of the incident or during any period the employer failed to post the required notice.  Moreover, the civil penalties for violations of ASSLA were broadened by the amendment.  Also, community associations are required to maintain documentation of hours worked by employees and paid leave taken for a period of three years.  Failure to do so creates a rebuttable presumption that the employer has violated ASSLA. 

Accordingly, all D.C. community associations should check their policies to make sure they are in compliance with amendment to ASSLA and, if necessary, seek advice of legal counsel.


Delaware Legislation Update: The New Ombudsman

By: Chad J. Toms, Esq.

On August 12, 2014, Delaware’s governor signed a bill into law creating an Office of the Common Interest Community Ombudsman within the Department of Justice.  What is the Ombudsman charged with doing, and how will it affect your community?

Under the new law, the Ombudsman is empowered to help Delaware communities understand their rights and responsibilities.  Equally important, the Ombudsman can also help resolved disputes between a community and its members without recourse to the judicial system. 

The legislation will be found at Sections 2540 through 2546 of Chapter 25 of Title 29.  Briefly it provides that the Ombudsman has the power:

  • To inform, assist and educate interested parties about their rights and responsibilities and the processes available to them according to the law, regulations, and documents governing their respective common interest community
  • To prepare and publish educational and reference materials
  • To develop and publicize procedures for fair elections
  • To provide monitors and vote counting services for elections
  • To provide meetings, mediation, or other forms of alternative dispute resolution
  • To receive and investigate complaints regarding potential violations of the law, regulations, or documents governing their respective common interest community
  • To establish and publish procedural rules for meetings, mediation, or other forms of alternative dispute resolution
  • To hold public meetings to gain a comprehensive sense of the issues facing common interest communities in Delaware

The legislation, only introduced in April of this year, had wide support from the community.  However, there was some concern voiced by the Community Associations Institute (“CAI”), a 33,000-member, international organization dedicated to building better communities through education and advocacy.  CAI applauded the Delaware legislators for working to address concerns of common interest communities but cautioned that similar programs in other states had proven to be costly, ineffective and ultimately unnecessary.  CAI gave the Delaware legislature a report they had issued in March of this year outlining the problems experienced in other states. In its report, CAI summarized the ombudsman programs in Colorado, Florida, Nevada and Virginia, and for the reasons discussed in the report concluded that other alternatives would be better.

Although the involvement of CAI did result in some changes to the Delaware legislation before reaching its final form, the legislature decided to proceed with creating the Office of the Ombudsman.

The Delaware legislation also created a Common Interest Community Advisory Council to advise and assist the Ombudsman and to make recommendations to the Ombudsman for future changes to Delaware law and procedure.  The Council is to be made up of numerous interested parties and industry groups including owners in common interest communities; representatives of state and local governments; people appointed by the Legislature; members of the bar; and appointees from the Home Builders Association of Delaware and CAI. 

The Council is supposed to meet at least four times a year.  Several explicit goals of the Council include: (1) creating a mechanism to increase collection rates; (2) developing a conflict and dispute resolution process; (3) creating a mechanism to register common interest communities; (4) developing an alternative to the current lien process; and, (5) studying the feasibility of requiring all common interest communities to pay an annual per unit assessment to support governmental services.

This legislation has the potential for sweeping changes to the way Delaware common interest communities operate.  We will continue to monitor the implementation of this legislation, but please contact us should you have any questions about how this legislation might relate to your communities.

D.C., Maryland and Virginia: Open Meeting Requirements

By: Alexander N. Rouhani, Esq.

Takeaway:  Open Meeting requirements restrict how and when a Board of Directors may discuss Association business. In general, they require that all meetings, including those of any committee or subcommittee, be open to all members of the Association, but provide a limited set of circumstances where a Board may enter an executive or closed session to discuss certain matters in private.

The biggest issue a Board can run into when dealing with Open Meeting requirements is determining when a “meeting” is actually taking place. If some Board members exchange emails about Association issues, is that a “meeting”? If three directors run into each other in the neighborhood, is that a “meeting”? To answer these questions it is best to look at each jurisdiction’s specific requirements. It is important to note that an Association’s governing documents may also impose additional Open Meeting requirements and should always be reviewed to ensure compliance.

I.    District of Columbia - Condos

The District of Columbia recently passed legislation incorporating Open Meeting requirements into the D.C. Condominium Act. D.C. Code §42-1903.03. Currently, D.C. does not have an Act that governs homeowners associations and the D.C. Cooperative Act does not impose Open Meeting requirements.

The D.C. Condominium Act requires that all meetings of a Board of Directors be open to all members of an Association who are in good standing. It also allows the Board to move into an executive session to consider: (1) personnel matters, (2) contracts, leases and other commercial transactions, (3) pending or potential litigation, (4) matters involving state or local administrative or other formal proceedings before a government tribunal for enforcement of the condominium instruments or rules and regulations, (5) consultation with legal counsel, (6) matters involving individual unit owners or members, and (7) for any compelling reason that overrides the public policy of an open meeting as long as it is supported by a two-thirds vote of the Board of Directors. 

Pursuant to the D.C. Condo Act, a “meeting” includes a telephone conference, video conference or similar electronic means. So this means a Board could be considered to be “meeting” if they are conversing in some manner over email or telephone conference. Because this is a new statute, there is very little additional guidance as to what constitutes a “meeting.”  Accordingly, Boards should take a conservative approach and avoid discussions about Association issues until the Open Meeting requirements are observed.

II.    Maryland – Condos and HOAs

Section 11B-111 of the Maryland Homeowners Association Act establishes the Open Meeting requirements for Homeowners Associations in Maryland, and Section 11-109.1of the Maryland Condominium Act provides the same for Condominium Unit Owners Associations. The Maryland Cooperative Housing Corporation Act does not have Open Meeting requirements.

The Open Meeting requirements for condos and HOAs vary slightly, but both require all meetings of the Board of Directors be open to all members of the Association. Both statutes provide for the same set of exceptions allowing a Board to enter a closed session including: (1) discussing personnel matters, (2) for the protection of the privacy or reputation of individuals in matters not related to association business, (3) consulting with legal counsel, (4) discussing pending or potential litigation or other legal matters, (5) investigating possible or actual criminal misconduct, (6) for consideration of the terms or conditions of a business transaction in the negotiation stage, if disclosure could adversely affect the economic interest of the association, (7) complying with any law that requires matters not to be publicly disclosed, and (8) discussing owner assessment accounts.

In Maryland, a recent opinion from the Montgomery County Commission on Common Ownership Communities (“CCOC”) defined the term “meeting.” In the combined cases of McBeth and Muse v. Fountain Hills Community Association, ##52-12 and 67-12 (May 1, 2014), a panel of the CCOC made the following rulings: (1) a “meeting” is a discussion in which action is taken by the Board, (2) a gathering or discussion by the Board for the purpose of solely discussing and not deciding Association business is NOT a “meeting,” and (3) a “meeting” conducted by email, instant messenger, telephone or otherwise not in person is by definition a closed meeting since other members cannot attend.

Although not binding, the CCOC decision draws a clear line for Maryland Boards: as long as the Board is not making a decision, then a meeting has not occurred, and the Open Meeting requirements are not triggered. This means that a Board may discuss Association business, whether in person or by some other means such as email, and it will not constitute a meeting unless an action is taken.

III.    Virginia – Condos and HOAs

Section 55-510.1 of the Virginia Property Owners Act establishes the Open Meeting requirements for Homeowners Associations, and Section 55-79.75 of the Virginia Condominium Act provides the same for Condominium Unit Owners Associations. Both code sections provide near identical language in regards to the Open Meeting requirements imposed on Boards. The Virginia Real Estate Cooperative Act does not have Open Meeting requirements.

The acts for condos and HOAs provide that all meetings of a Board of Directors, including the meetings of any committee or subcommittee, be open to all members of the Association. They do allow a Board, however, to enter an executive session to discuss certain matters in private. These matters include: (1) personnel matters, (2) to consult with legal counsel, (3) to discuss and consider contracts, pending and/or probable litigation and matters involving violations of the declaration or rules and regulations, and (4) matters relating to the personal liability of any member to the association.

The Virginia statutes give a broad meaning to the term “meeting” by including “work sessions” and “informal gatherings” within its definition. The question then becomes do emails or running into a fellow board member in the neighborhood constitute work sessions or informal gatherings? Unfortunately, there is no clear-cut answer to this question. In a recent decision by the Supreme Court of Virginia interpreting similar Open Meeting requirements contained in the Freedom of Information Act, the Court determined that emails exchanged in rapid succession on an email thread where a majority of the Board members were included could constitute a “meeting” and violate the Open Meeting requirements. See Hill v. Fairfax Sch. Bd., 284 Va. 306, 311, 727 S.E.2d 75, 78 (2012). Accordingly, email communications could in fact constitute a “meeting” in Virginia depending on the discussion.

Given the uncertainty described above, the best approach by a Board would be a cautious approach. A Board is best served to avoid any discussion regarding the Association’s affairs when a majority is present if the Open Meeting requirements have not been observed. The dissemination of information among a Board is likely not a problem, but the discussion of that information could very well be. Therefore, it is best to play it safe and avoid discussions outside of a properly called “meeting.”