2026 saw many legislative changes to Virginia’s employment laws, with eight major changes from the General Assembly that will impact virtually every business and employer across the state. From pay transparency and minimum wage increases to expanded protections and obligations, employers are facing a multi-year rollout of new compliance responsibilities. While some changes are already in effect, others will not be implemented until 2029, giving your business the valuable time to prepare now and avoid compliance issues down the road.

Virginia’s new statewide paid sick leave law is one that every employer should have on their radar. Although you will not be required to comply for up to another two and a half years, the law introduces new standards and policies that are worth understanding now. In this Learning Lab, we will break down the changes and help you best prepare for when paid leave takes effect.

Understanding the New Paid Leave Laws

This past General Assembly Session, legislation was enacted establishing both a statewide paid sick leave mandate (HB 5/SB 199) and paid family and medical leave (HB 1207/SB 2).  While both provide employees with paid time away from work, they serve different purposes and have separate compliance requirements.

• Paid Sick Leave: Virginia’s paid sick leave law requires employees to accrue one hour of paid sick leave for every 30 hours worked, up to 40 hours per year. Leave may be used for sickness, caregiving, preventative care, and domestic violence situations. Businesses may allow leave to accrue, or they may frontload 40 hours at the beginning of the year. The law takes effect based on employer size but will not begin until Q2 of 2027.
  • July 1, 2027: 50+ employees
  • January 1, 2028: 25+ employees
  • January 1, 2029: All employers

• Paid Family and Medical Leave: The recently established paid family and medical leaveprogram provides wage replacement during long-term events like a new child, long-term health issues, or caring for a loved one with serious illness. Premium collection begins in under two years on April 1, 2028, and benefits become available on December 1, 2028. Your eligible employees may receive up to 12 weeks of benefits, replacing 80% of their average weekly net earnings, up to a statewide cap. Unlike paid sick leave, PFML is funded by employer and employee payroll contributions. If your business has more than 10 employees, they will contribute to the program, while smaller businesses must withhold and remit employee contributions but are exempt from the employer-side premium.

Why You Should Start Planning for Paid Leave Now

While many small businesses won’t need to comply with Virginia’s new leave laws until 2029, waiting until the deadline approaches can make policy implementation more difficult. The phased rollout is purposefully intended to give employers time to prepare, instead of requiring many changes on short notice.  

Implementing a new leave policy requires more than updating your handbook. For starters, your payroll system will need to be updated to track leave and accommodate leave premium deductions. Along with systems, internal documentation and procedures will need to be updated to ensure alignment with the new requirements and to clearly communicate expectations to employees. Planning ahead also allows businesses to spread administrative and financial costs over several years. Whether working with a consultant, payroll provider, or a legal advisor, making small updates in advance is typically less disruptive than implementing multiple changes at once.

Local business owners should continue monitoring guidance from the Virginia Commissioner of Labor and Industry and the Virginia Employment Commission, as additional regulations and contribution rates will be released before the laws take effect. InUnison will also provide legislation updates on our member portal as they occur, including Virginia Retail Federation’s recent public comments on paid leave.

You May Already Be Closer Than You Think

The best place to start your planning for paid leave compliance is to ask yourself a few questions about your current paid leave. Many businesses already offer enough PTO to comply with the new legislation and leave requirements. It is essential to confirm whether your policy already covers new laws and that your policy is clearly and correctly documented. Ask yourself the following questions:

• Do we already offer paid time off?
• Is our leave policy separate sick leave or combined PTO?
• How much paid leave do employees currently receive?
• How is leave earned or awarded?
• Is our leave policy clearly documented in our employee handbook?

Once you have a clear understanding of where your paid leave policy currently stands, it will be easier to determine which updates are needed and how quickly to make them. By comparing your policy against the law, you may find that you already meet the requirements or identify policy gaps that are easy to update. The sooner you begin exploring what updates your policy needs, the more likely you are to be prepared for changes and to avoid compliance fines. 

Check out our July 1 Compliance Checklist for more paid leave action items.

Important Rules Employers Should Know

Complying with these legislative changes involves more than providing employees with paid time off. It also requires you as a business owner to administer leave in accordance with the laws.  A few important rules to note include:

• Employers cannot require employees to find a replacement worker or work an alternate shift when using earned sick leave.
• The law also includes strong anti-retaliation provisions, allowing employees to bring a private legal action if they believe their rights have been violated.
• Knowingly violating the law can result in civil penalties of up to $500 per violation.

Key Takeaways

Although many deadlines are still over a year away, preparing now will ensure a smooth transition to your new paid leave policy. By understanding the new laws and being prepared, you set your business up for HR success. As a reminder:

• Virginia’s new paid leave laws are rolling out by 2029. Paid sick leave and paid family and medical leave have different requirements and timelines, giving employers time to prepare before compliance deadlines.
• Start planning now. Updating payroll systems, employee handbooks, internal procedures, and budgets takes time, and spreading those changes out is easier than making last-minute adjustments.
• Your current PTO policy may already meet some of the new requirements. Review your existing leave policy to determine whether it provides sufficient paid leave.
• Compliance is about more than offering leave. Employers must follow new administrative requirements to avoid potential penalties.

Stay tuned for more employment legislation learning labs. For more information about paid leave, read our Paid Leave legislative updates.