Pittsburgh's Sick-Leave Ordinance Just Got Bigger: What the 2026 PSDA Amendment Means for Your Payroll

If even one of your employees works inside Pittsburgh's city limits, your paid sick leave obligation nearly doubled on January 1, 2026 — and your payroll system, your handbook, and your budget probably still reflect the old numbers. The amendment to Pittsburgh's Paid Sick Days Act (PSDA) raised both the accrual rate and the annual caps, with the biggest jump landing on the smallest employers. Here is what changed, what it costs, and the exact payroll checklist that keeps you compliant.

What Changed on January 1, 2026​

City Council passed the amending ordinance on June 10, 2025, and the mayor signed it shortly after. The changes took effect at the start of 2026. Three numbers moved, and all three moved against employers:

Two things did not change: the law still covers any business with at least one employee working in the city, regardless of where the business itself is located, and the amendment applies to every covered worker based on hours actually worked inside Pittsburgh.

For context, this is the first major expansion since the PSDA survived its courtroom saga. The ordinance was enacted in 2015 but blocked by business-group lawsuits until the Pennsylvania Supreme Court upheld it, so it did not take effect until March 2020. Six years later, the city has decided the original amounts were too low.

Who Has to Comply​

The coverage test is broader than most owners expect:

• One employee is enough. If a single person performs work within Pittsburgh's city limits, you are a covered employer — even if your office is in the suburbs and only one staffer crosses into the city.
• Headcount sets your cap. Count all employees to determine whether you sit at or above the 15-employee line (72-hour cap) or below it (48-hour cap). A growing business that hires its 15th employee mid-year moves into the higher tier.
• Hours are location-based. Only hours worked inside Pittsburgh generate accrual. An employee who splits time between a city job site and a suburban warehouse accrues only on the city hours — which means your timekeeping has to track work location, not just total hours.

If that last point made you wince, you are not alone. Location-split accrual is the single most common reason small employers under-accrue, and it is exactly what an auditor asks about first.

What Employees Can Use the Leave For​

Accrued sick time is not general-purpose PTO. The ordinance limits use to specific reasons, which fall into three buckets:

1. Illness and preventive care — the employee's own condition or that of a family member, including doctor visits and recovery time.
2. Public-health closures — when the employee's workplace, or a child's school or care facility, closes by order of a public official during a health emergency.
3. Safe leave — absences related to domestic violence, sexual assault, or stalking, for the employee or a family member.

Your written policy should list these permitted uses in plain language. A policy that just says "sick leave per city law" without explaining when leave can be taken invites both misuse and disputes.

The Three-Law Patchwork: Pittsburgh vs. Allegheny County vs. Philadelphia​

Here is the complication Pennsylvania employers did not ask for. Before 2026, Pittsburgh and Allegheny County used identical accrual rates and caps, so one policy covered the whole metro area. The amendment broke that alignment, and unless the county revises its law, employers now juggle three regimes:

The practical consequences:

• City-only staff fall entirely under the Pittsburgh rules.
• County-only staff fall under the county rules, which are now less generous.
• Split-location staff accrue under each law for hours worked in that jurisdiction. A technician who works three days in the city and two days elsewhere earns Pittsburgh-rate accrual on the city hours and county-rate accrual on the rest.
• One-policy shops can simplify life by applying the most generous standard — Pittsburgh's — to everyone. That is lawful (every law sets a floor, not a ceiling) and often cheaper than the bookkeeping cost of running parallel accrual engines.

If you operate in Philadelphia too, you are tracking a third set of numbers. At that point, a single Pittsburgh-or-better policy is less a luxury than a survival strategy.

Frontload or Accrue? Picking a Method​

The ordinance sets minimum accrual; it does not dictate your delivery method. Employers generally choose between two approaches:

Accrual (pay as you go). Employees earn leave incrementally each pay period based on hours worked. This matches cost to actual labor and avoids granting a full year's leave to someone hired in December. The price is administrative: your payroll system must compute fractional accruals every cycle, enforce the correct cap for your headcount tier, and handle location splits.

Frontloading (grant the year up front). You deposit the full annual amount — 72 or 48 hours — into each employee's balance at the start of the year. Tracking becomes trivial, but you hand every employee, including January hires who quit in March, the entire year's benefit on day one.

With caps nearly doubling, the frontloading gamble got more expensive. Handing a new hire 72 hours on January 2 means up to nine paid days of absence before they have earned any of it. Many small employers that comfortably frontloaded 24 hours are switching to per-pay-period accrual now that the number is 48 or 72. Before you switch, confirm how your choice interacts with year-end carryover and rehire rules — the ordinance's carryover provisions were written around accrual, and a sloppy conversion can accidentally shortchange balances.

Whichever method you choose, document it in the written policy and configure it identically in payroll. A handbook that says "accrual" while the payroll system frontloads is a violation wearing a disguise.

What This Costs You: Budgeting the New Caps​

Run the math for a full-time employee earning 22 dollars an hour and working 2,080 hours a year:

• At the new 1-per-30 rate, that employee accrues about 69 hours a year (2,080 divided by 30). Under the old 1-per-35 rate, the same employee accrued about 59 hours. The rate change alone adds roughly 10 paid hours per full-timer — about a 17 percent increase.
• At a 15-or-more employer, the 72-hour cap barely binds for full-timers (69 is under 72), so maximum exposure per employee rises from 40 hours (880 dollars) to roughly 69 hours (about 1,520 dollars) — a 73 percent jump in worst-case cost.
• At a smaller employer, the story is starker. The old 24-hour cap cut accrual off far below what employees earned; the new 48-hour cap still binds but at twice the level. Maximum exposure per full-timer doubles from 528 dollars to 1,056 dollars.

Part-timers feel different: someone working 20 hours a week accrues about 35 hours a year, so the caps rarely touch them and only the faster rate matters.

Three budgeting moves follow directly:

1. Rebuild your labor-cost model with the new accrual rate, not just the new caps. The rate is what every employee actually earns; the cap is only the ceiling.
2. Price the worst case into bids and retainers. Service businesses with city-site crews should treat the full cap as a known labor cost when quoting 2026 work.
3. Watch the 15-employee line. Crossing it mid-year upgrades every employee's cap from 48 to 72 hours. If you plan to hire through that threshold, budget the higher tier from January rather than absorbing a surprise in July.

Your Payroll Compliance Checklist​

Use this list in order. Every item maps to something the city's enforcement office — the Office of Equal Protection — can ask to see.

1. Update the written policy​

Revise your handbook or standalone sick-leave policy to state the 1-per-30 rate, your correct annual cap, the permitted uses, and whether you accrue or frontload. The city publishes model policies for employers above and below the 15-employee line; start from the model rather than drafting from memory.

2. Reconfigure payroll before the next cycle​

Update the accrual engine with the new rate and cap, confirm the cap matches your current headcount tier, and verify that location-split employees accrue only on Pittsburgh hours. Run a parallel test on one pay period — old rules versus new — and reconcile every variance before going live.

3. Show balances on pay statements​

Revised city guidelines released in December 2025 require employers to affirmatively notify employees of their accrued sick-leave balances on each pay statement. If your pay stubs do not currently show a sick-leave balance line, add one. This is the compliance item most small employers are missing right now.

4. Post notices and distribute rights statements​

The PSDA requires a workplace poster plus individual written notice to each employee covering the leave amount, permitted uses, the ban on retaliation, and the right to file a complaint. Fines for notice and posting violations apply per instance of noncompliance, so a missing poster in each of three break rooms is three violations, not one. Refresh postings and re-issue the individual notice to reflect the 2026 numbers.

5. Keep two years of records​

Retain hours worked, sick leave accrued and taken, and the policies in effect for at least two years. Store them where you can actually produce them: a shoebox of printed timecards technically counts, but a searchable payroll export is what ends an inquiry quickly. Calendar a quarterly export so records never depend on one person's memory.

6. Train managers on retaliation​

Considering sick-leave use in performance reviews, reassigning shifts to punish absence, or even pointedly questioning every request can constitute retaliation. Managers need one clear rule: approve qualifying leave without commentary, document only the hours, and never let usage enter a review or scheduling decision.

Common Mistakes That Trigger Complaints​

Most PSDA complaints are not about employers acting in bad faith. They follow a handful of mechanical errors:

• Accruing on all hours instead of Pittsburgh hours (or vice versa). Either direction creates liability — over-accrual is just money, but under-accrual is a violation.
• Applying the wrong cap after headcount changes. Businesses that grow past 15 employees — or shrink below — and forget to flip the tier shortchange or over-grant for months.
• Counting leave against attendance policies. Points-based attendance systems that dock workers for PSDA-protected absences convert a lawful absence into an unlawful penalty.
• Requiring documentation the ordinance does not allow. Keep certification demands within what the law permits, and apply them consistently.
• Forgetting rehires. When a former employee returns, handle their prior balance under the ordinance's rehire provisions rather than starting them at zero by default.

How This Hits Your Books​

Sick leave is not just an HR policy — it is a growing liability on your balance sheet. As employees accrue hours they have not yet used, you owe future paid time off, and sloppy tracking turns that obligation into a surprise.

• Book the liability as it accrues. Each pay period, record sick-pay expense with an offsetting accrued-leave liability rather than expensing leave only when taken. That keeps monthly profit figures honest instead of lurching every flu season.
• Keep sick pay in its own ledger account. Separate accrued sick leave from vacation, bonuses, and regular wages so you can answer "what did the PSDA cost us this quarter?" without a forensic dig. If you keep your books in plain text, a dedicated liability account plus a monthly accrual transaction does the job — the Beancount documentation walks through liability tracking patterns you can adapt to leave balances.
• Reconcile payroll to the ledger monthly. Your payroll system's accrued-balance report and your liability account should agree every month. Drift between them is how phantom balances — and real underpayments — accumulate unnoticed.
• Tag costs by work location. If you run crews across city and county lines, location-tagged time entries let you prove which accrual rule produced each hour. A dashboard view of leave costs by site, like the visualizations Fava generates from a plain-text ledger, makes the city-versus-county split visible at a glance.

Keep Your Payroll Records Audit-Ready​

Pittsburgh's 2026 sick-leave expansion rewards employers who treat leave as a measured liability and punishes those who treat it as a rounding error. Update the policy, reconfigure payroll, show balances on pay stubs, and keep two years of clean records — and the amendment becomes a budgeting exercise instead of an enforcement risk.

Clear records are what make all of this routine rather than stressful. Beancount.io offers plain-text accounting that is transparent, version-controlled, and AI-ready, so your leave liabilities, payroll reconciliations, and location-tagged labor costs live in one auditable ledger. Get started for free and see why developers and finance professionals are switching to plain-text accounting.