California's new Healthy Workplaces, Healthy Families Act of 2014 will require most California employers to provide paid sick leave to employees beginning July 1, 2015. This FAQ is designed to assist employers to comply with the new law. 

 

 

Q:        Which employers are covered under the new law?

 

A.        All private and public employers are covered under the new law, regardless of size. There is no exemption for small employers. Also, the term "Employer" is broadly defined to include not only the entity actually employing the employees, but also "any person employing another under any appointment or contract of hire and includes the state, political subdivisions of the state, and municipalities." As written, this means business owners face personal liability for non-compliance.

 

Q:        Are any employees exempt from the new law?

 

A.        Yes. The following employees are specifically exempted from enjoying the benefits of the new law:

 

(1) employees covered by certain collective bargaining agreements (check with your labor counsel);

(2) certain providers of in-home supportive services; and

(3) certain individuals employed by an air carrier as a flight deck or   cabin crew member.

 

Q:        Which employees are eligible for paid sick leave?  

 

A.        All full time or part time employees who work 30 or more days within a calendar year are eligible to receive the new paid sick leave benefit.  There is no minimum number of hours per week or month that an employee is required to work to begin accruing paid sick leave.

 

Q:        What are the new sick leave benefits?

 

A.        Beginning July 1, 2015, employees accrue paid sick days at the rate of one hour of paid sick leave for every 30 hours worked. That's 69.3 hours a year (or 1.3 hours/week) for a full time employee who regularly works 40 hours a week.

 

Q:        Must an employer track sick leave accrual for salaried exempt employees who don't record their time?

 

A.        Yes. The new law states that exempt employees are presumed to work 40 hours per week for sick leave accrual purposes. If the employee's normal workweek is less than 40 hours, the exempt employee accrues paid sick leave based on the normal number of workweek hours.

 

Q:        When may employee begin to use their accrued paid sick leave?

 

A.        By law, sick leave accrual begins on the first day of employment. However, an employer may prohibit employees from using accrued paid sick leave until after the employee has completed 90 days of employment.

 

Q:        May an employer place a limit on the number of sick days used?

 

A.        Yes. An employer may limit an employee's use of paid sick days to 24 hours (or three days) in each year of employment.

 

Q:        Must an employer permit unused paid sick leave days to carry over from year to year?

 

A.        Yes. However, the law permits employers to establish an accrual cap of 48 hours, or 6 days per year. Employers wishing to avoid the tedious task of tracking sick leave hours worked and taken may do so by allowing employees to access the full complement of annual paid sick leave days as of January 1st each calendar year. By "front loading" the full amount of leave that could be used at the beginning of each year (i.e., 24 hours or three days), employers avoid having to calculate and report weekly accrual and carryover. However, usage still must be reported (see below).

 

Q:        Must an employer pay out unused sick leave upon separation of employment?

 

A.        No.  However, if the employee is rehired within one year from the date of separation, previously unused and accrued sick days must be reinstated.

 

Q:        What if the employer already has a paid time off or paid sick leave policy?

 

A.        The new law only sets a minimum entitlement. An employer is not required to provide additional paid sick days under the new law if the employer already has a paid leave or paid time off policy which permits employees to use the paid time for the same purposes, and under the same conditions  as those permitted under the new law and the paid leave or paid time off policy does either of the following: (1) satisfies the accrual (1 hour per every 30 hours worked), carry-over and use (24 hours per year) requirements; OR (2) provides no less than 24 hours or three days of paid sick leave for employees to use in any 12-month period.

 

Q:        For what reasons may an employee use paid sick leave?

           

A.        Employers must allow employees to use their paid sick leave for any of the following reasons:

 

(1) An employee (or covered family member's) diagnosis, care, or treatment of an existing health condition or preventive care; or

(2) For an employee who is a victim of domestic violence, sexual assault, or stalking.

 

Q.        Who is considered a "family member"?

 

A.        The term "family member" is broadly written to include: 

 

• A child (biological, adopted, or foster child, stepchild, legal ward or a child to whom the employee stands in loco parentis, regardless of age or dependency status). This includes adult children as well.
• spouse
• registered domestic partner
• grandparent
• grandchild
• sibling
• A biological, adoptive, or foster parent, stepparent, or legal guardian of an employee or the employee's spouse or registered domestic partner, or a person who stood in loco parentis when the employee was a minor child  

 

Q:        How does an employee access these benefits?

 

A.        All they have to do is ask for the time off. If the reason is one of the permitted reasons outlined above, the employee must be permitted to take the time off. However, if the need for leave is foreseeable, the employee must provide reasonable advance notice. If the need for paid sick leave is unforeseeable, the employee must provide notice of the need for leave as soon as possible.

 

Q:        May an employer ask for documentation that sick pay was actually used for a permitted purpose?

 

A.        No. There is no express requirement in the new law that permits and authorizes employers to require documentation from the employee that sick time has been used for a covered purpose. Accordingly, an employer should not request documentation unless such documentation can be required for another legitimate purpose, such as when the leave also is being counted towards the employee's leave rights under the California Family Rights Act ("CFRA"), Pregnancy Disability Leave ("PDL"), Family Medical Leave Act ("FMLA") or similar leave laws.

 

Q:        At what rate of pay must sick leave be paid?

 

A.        Typically, the rate of pay will be the employee's hourly wage. However, where the employee has two different hourly pay rates, was paid by commission or piece rate, or was a non-exempt salaried employee, the rate of pay is determined by a formula: Divide the employee's total pay for the previous 90 days (not including overtime premium pay), by the employee's total hours worked.

 

Q:        May an employer set a minimum increment of sick leave that can be used?

 

A.        Yes. An employer may set a reasonable minimum increment, so long as it is no higher than two hours. Requiring employees to access paid sick leave in half day or full day increments is not permitted. This rule can come into play, for example, when an employee comes in 2 hours late and claims he or she was "ill" or that they stayed home to care for an ill family member. Great care has to be taken not to discipline employees who take advantage of these rights. This includes not counting the paid leave time against an absence/tardiness disciplinary schedule.

 

Q:        Is there a posting requirement?

 

A.        Yes. The Labor Commissioner will create a poster containing the information and make it available to employers. Employers must post this new poster with other required postings.

 

Q:        Are there any record keeping requirements?

 

A.        Yes. Each pay day, an employer is required to provide employees with written notice of the amount of available paid sick leave (or paid time off leave in lieu of sick leave) on the employee's itemized wage statements or in a separate writing. An employer also is required to keep records for 3 years documenting hours worked, as well as paid sick days accrued and used by the employee.

 

Q:        Is there an anti-retaliation provision?

 

A.        Yes. In fact, the new law even goes so far as to say that there is a rebuttable presumption of unlawful retaliation where an employer denies an employee the right to use accrued sick days, discharges, threatens to discharge, demotes, suspends or in any manner discriminates against an employee within 30 days of: (1) the filing of a complaint by the employee with the Labor Commissioner alleging a violation of the new law; (2) the cooperation of an employee with an investigation or prosecution of alleged violations of the new law; or (3) opposition by the employee to a policy, practice, or act that is prohibited by the new law. This "opposition" can take many forms and employers must be mindful that any protest by employees may be considered "opposition".

 

Q:        Are there any penalties for non-compliance?

 

A.        Yes. Employers who don't comply are subject to a penalty equal to three times the dollar value of paid sick days withheld from the employee or $250, whichever is greater, but not to exceed an aggregate penalty of $4,000. If a violation results in other harm to the employee (such as discharge) the administrative penalty also shall include an additional sum of $50 for each day the violation occurred, up to an additional $4,000. 

 

If you have any questions regarding California's new paid sick leave law, please call your contact at the firm.