- Governor Signs Urgent Measure Clarifying CA Paid Sick Leave Law: Four Action Steps for Employers Now
- September 10, 2015
- Law Firm: DLA Piper (Canada) LLP - Vancouver Office
- California employers have stepped up to comply with the July 1, 2015 deadline for the new California paid sick leave law. Now changes have arrived that may help clarify the law.
On July 13, 2015, Governor Jerry Brown signed into law urgency measure AB 304, which further explains which workers are covered and how the paid time off is accrued, and sets out protections for employers that already provide paid sick leave. This measure is effective immediately.
The Healthy Workplaces, Healthy Families Act of 2014 provides paid sick days to most California employees effective July 1, 2015. The paid sick leave law is landmark legislation that requires paid sick days for all California employees. However, the passage of such a sweeping workplace benefit spurred discussions that prompted subsequent legislation to clarify a few of the law's requirements in order to ease implementation of the new paid sick leave law.
AB 304’s amendments will make compliance with the paid sick leave law simpler in a number of ways.
Flexibility on existing paid sick leave plans
- An employer is not required to provide additional paid sick days if the employer has a paid leave policy or paid time off policy and if the employer makes available (beginning July 1, 2015) leave that may be used for the same purposes and same conditions, and the policy satisfies one of the following options:
a) Accrual, carry-over and use requirements of the law.
b) Provided paid sick leave or paid time off to class of employees before 1/1/15 under a policy that used an accrual method different than providing one hour per every 30 hours worked, if the accrual is on a regular basis so that an employee, including an employee hired into that class after 1/1/15, has no less than one day or 8 hours of accrued leave within three months, and the employee was eligible to earn at least three days or 24 hours within nine months. If the employer modifies the accrual method used in the policy it had in place prior 1/1/15, then the employer must comply with any accrual method set forth in existing law or provide the full amount of leave at the beginning of the year. Employer can elect to increase accrual amount or rate.
c) Sick leave or annual leave benefits provided to specified state employees or officers by statute or the provisions of a MOU meet the requirements of the paid sick day's law.Flexibility for calculating sick pay
- The employer is to calculate paid sick leave using any of the following methods:
a) Paid sick time for nonexempt employees should be calculated in the same manner as the regular rate of pay for the workweek in which the employee uses paid sick time, whether or not the employee actually works overtime in that workweek.
b) Paid sick time for nonexempt employees should be calculated by dividing the employee's total wages, not including overtime premium pay, by the employee's total hours worked in the full pay periods of the prior 90 days of employment.
- Paid sick time for exempt employees should be calculated in the same manner as employer calculates wages for other forms of paid leave time.
- If the employer provides unlimited paid sick leave or unlimited paid time off, then the employer may the employee's itemized wage statement that such leave is "unlimited."
- Application of provisions related to the inclusion of the amount of paid sick leave available on itemized wage statements or separate writings is delayed until January 21, 2016, for employers in the broadcasting and motion picture industries.
- Employers are not required to reinstate accrued paid time off to a rehired employee who was paid out at the time of termination, resignation or separation of employment.
- Employers are not obligated to inquire into or record the purpose for which an employee uses paid leave or paid time off.
- Review your current paid sick leave calculation method and plan to see whether you have over-allocated the amount of paid sick leave under the latest amendment and to ensure that if the an alternative accrual method is used (such as accruing a set amount per payroll period), then the employee will earn at least 24 hours of sick leave within the first 120 calendar days of work.
- Motion picture and broadcasting industry employers can calendar implementation of provisions related to the inclusion of the amount of paid sick leave available on itemized wage statements or separate writings for January 21, 2016.
- For employers who offer unlimited time off, consider putting “unlimited” on the wage statement in lieu of “time used” (but be careful that this does not create an opportunity for employees to use “unlimited” sick time on extended leaves).
- Review your reinstatement of paid sick leave policy to address payout on termination of sick time regarding departed employees who may be be reinstated within a year.