BlogLine

Philadelphia’s POWER Act: What employers need to know 

6/19/25

By: Joseph A. McGuire

On May 27, 2025, Philadelphia Mayor Cherelle L. Parker signed into law the Protect Our Workers, Enforce Rights (POWER) Act, a sweeping update to the employment provisions contained in Title 9 of the Philadelphia Code.  

Key Provisions of the POWER Act 

The Act expands employee protections, enhances penalties on non-compliant employers operating within the city and strengthens enforcement mechanisms through the City’s Department of Labor, Office of Worker Protection (OWP), which is the primary agency for investigating and enforcing all employment-related ordinances under the Act. Here are a few key provisions: 

• Paid Sick Time Protections: The Act provides additional safeguards to prevent interference with employee rights to paid sick time. With respect to calculating paid sick time for tipped employees, the Act refers to the “numerical average” of three Standard occupational Classification Codes. The Act authorizes the OWP to investigate and resolve alleged violations by employers and to award liquidated damages to employees. Finally, the Act requires employers to keep records of compliance for three years and establishes a presumption of violation when an employer lacks sufficient records.  

• Wage Theft Protections: The Act increases penalties for wage violations by imposing a $2,000 monetary penalty for each violation and providing for liquidated damage awards. The Act prescribes an administrative procedure for the resolution of wage theft complaints and, again, calls for a presumption of non-compliance where an employer fails to keep adequate records or refuses to participate in the OWP proceedings.  

• Domestic Worker Protections: Under the Act, domestic workers are entitled to paid meal breaks and the accrual of paid sick time. Furthermore, employers are required to provide written contracts memorializing specific terms of domestic workers’ employment and, with respect to terminations, employers must comply with minimum notice and severance requirements.  

• Enhanced Anti-Retaliation Provisions: The Act introduces broader safeguards for workers who report violations or assert their rights. Notably, the Act imposes a presumption of retaliation upon any adverse action taken against an employee within 90 days of an employee engaging in protected activity under the paid sick time provisions of the Act.  

• Recordkeeping Duties: Finally, the Act requires employers to maintain records of compliance with the paid sick time provisions for three years now instead of two. It also calls for a presumptive finding of violation in any proceeding where an employer’s records are inadequate.  

What This Means for Employers 

Employers who act now to align their practices with these new requirements will be best positioned to avoid costly disputes and foster a fairer, more compliant workplace.  

1. Review Policies and Procedures: While the POWER Act removes handbook notice requirements, certain records are now required to be maintained for a longer period. There are also increased consequences for inadequate recordkeeping.  

2. Train Supervisors and HR Staff: Frontline managers should be informed of the expanded rights of workers, the risks of noncompliance and the nature of OWP investigations. 

3. Prepare for Increased Enforcement: The City has signaled a more aggressive enforcement posture. Employers should be prepared for audits, investigations and potential penalties. 

Looking Ahead 

The OWP is expected to release educational materials and guidance for employers in the coming months. In the meantime, businesses should consult legal counsel to assess their risk exposure and develop a compliance strategy. 

For more information, please contact Joseph A. McGuire at joseph.mcguire@fmglaw.com or your local FMG attorney.

Information conveyed herein should not be construed as legal advice or represent any specific or binding policy or procedure of any organization. Information provided is for educational purposes only. These materials are written in a general format and not intended to be advice applicable to any specific circumstance. Legal opinions may vary when based on subtle factual distinctions. All rights reserved. No part of this presentation may be reproduced, published or posted without the written permission of Freeman Mathis & Gary, LLP.