(1) Sick leave shall be computed as follows:
(a)  The rate per hour at which sick leave shall accrue to eligible classified and nonclassified officers and employees earning credited state service shall be at the rate represented by the proportion 96/2080. Sick leave shall accrue without limit and shall be transferable from department to department.
(b)  Sick leave shall not accrue to any officer or employee on any kind of leave of absence without pay, suspension without pay, or layoff. Sick leave shall accrue while an officer or employee is on approved leave with pay, on approved vacation leave, on approved military leave with pay, and on approved sick leave, but not when compensatory time is taken.
(c)  All accrued sick leave shall be forfeited at the time of separation from state service and no officer or employee shall be reimbursed for accrued sick leave at the time of separation, except as provided in subsection (2) of this section. If such officer or employee returns to benefited credited state service within three (3) years of such separation, all sick leave credits accrued at the time of separation shall be reinstated for use, except to the extent that unused sick leave was utilized for the purposes specified in subsection (2) of this section or transferred to a school district or charter district pursuant to section 33-1217, Idaho Code.
(d)  Sick leave shall be taken on a workday basis. Regularly scheduled days off and officially designated holidays falling within a period of sick leave shall not be counted against sick leave. Sick leave shall not be taken in advance of being earned and shall only be taken in pay periods subsequent to being earned.
(e)  In cases where absences for sick leave exceed three (3) consecutive working days, the appointing authority may require verification by a physician or other authorized practitioner.
(f)  If an absence for illness or injury extends beyond the sick leave accrued to the credit of the officer or employee, the officer or employee may be granted leave without pay.
(g)  The administrator shall prescribe additional requirements for sick leave for classified and nonclassified officers and employees on a part-time or irregular schedule, for maintaining sick leave records, for funeral leave and for such other applicable purposes as necessary.
(2)  Unused sick leave may be used as follows:
(a)  Upon separation from state employment by retirement in accordance with chapter 13, title 59, or chapter 1, title 33, Idaho Code, an employee’s unused sick leave shall be determined based on accumulated sick leave earned subsequent to July 1, 1976, and shall be reported by the employer to the public employee retirement system. Upon separation from state employment by retirement in accordance with chapter 20, title 1, Idaho Code, an employee’s unused sick leave shall be determined based on accumulated sick leave earned subsequent to July 1, 2000, and shall be reported by the employer to the public employee retirement system. A sum equal to one-half (1/2), or the maximum amount allowed by paragraph (b) of this subsection, whichever is the lesser, of the monetary value of such unused sick leave, calculated at the rate of pay for such employee at the time of retirement, as determined by the retirement board, shall be transferred from the sick leave account provided by paragraph (c) of this subsection and shall be credited to such employee’s retirement account. The remaining one-half (1/2) balance shall be forfeited. Such sums shall be used by the Idaho public employee retirement board to pay premiums, as permitted by and subject to applicable federal tax laws and limits, for such health, dental, vision, long-term care, prescription drug, and life insurance programs as may be maintained by the state, to the extent of the funds credited to the employee’s account pursuant to this section. Upon an employee’s death, any unexpended sums remaining in the account shall revert to the sick leave account.
(b)  For the purposes of determining the monetary value of unused sick leave, the maximum unused sick leave that may be considered shall be:
(i)   During the first ten thousand four hundred (10,400) hours of credited state service, the maximum unused sick leave that may be considered shall be four hundred twenty (420) hours;
(ii)  During the second ten thousand four hundred (10,400) hours of credited state service, the maximum unused sick leave that may be considered shall be four hundred eighty (480) hours;
(iii) During the third ten thousand four hundred (10,400) hours of credited state service, the maximum unused sick leave that may be considered shall be five hundred forty (540) hours; and
(iv)  Thereafter, the maximum unused sick leave that may be considered shall be six hundred (600) hours; and
For any employees of a state educational agency with unused sick leave that includes sick leave credited pursuant to section 33-1217, Idaho Code, the credited state service requirements of subparagraphs (i) through (iv) of this paragraph shall not apply, but the maximum unused sick leave that may be considered shall be six hundred (600) hours.
(c)  Each employer in state government shall contribute to a sick leave account maintained by the public employee retirement system in trust exclusively for the purpose of the provisions of this section. The retirement board shall serve as trustee of the trust and shall be indemnified to the same extent as provided in section 59-1305, Idaho Code. Assets in the trust shall not be assignable or subject to execution, garnishment or attachment or to the operation of any bankruptcy or insolvency law. The rate of such contribution each pay period shall consist of a percentage of employees’ salaries as determined by the board, and such rate shall remain in effect until next determined by the board. Any excess balance in the sick leave account shall be invested, and the earnings therefrom shall accrue to the sick leave account except the amount required by the board to defray administrative expenses. Assets of the trust may be commingled for investment purposes with other assets managed by the retirement board. All moneys payable to the sick leave account are hereby perpetually appropriated to the board and shall not be included in its departmental budget. The state insurance fund and public health districts shall be considered employers in state government for purposes of participation under this section.