On April 5, 2016, San Francisco, California's Board of Supervisors approved a measure mandating that San Francisco employers provide six weeks of fully paid leave during a calendar year for new parents, including mothers, fathers, and same-sex couples, who either bear or adopt a child. It is another in a long line of employee-friendly laws recently passed both in California and around the country.
The new city law supplements California's existing Family Temporary Disability Insurance (FTDI), which provides employees with 55 percent of their base pay, up to a statutory cap, for six weeks.
Starting in 2017, San Francisco's ordinance will complement FTDI, and require employers with 50 or more workers to provide the remaining 45 percent of employees' wages for the same six-week period. Like FTDI, the employer's additional payment will also be capped at the statutory amount. Businesses with at least 20 employees have until 2018 to comply.
The Bottom Line: San Francisco's new ordinance providing enhanced leave benefits for new parents puts San Francisco at the front of the pack in the U.S. Even so, the U.S. continues to be a global anomaly when it comes to paid parental leave. Out of the 185 countries listed by the International Labor Organization, the U.S. is one of only two nations that does not have a national law providing some form of paid parental leave.
We will have to wait and see whether San Francisco's new law will catch on with other U.S. cities and states or at a national level. With the increasing number of local paid sick leave laws and greater efforts to raise the minimum wage, it will be interesting to see if paid parental leave becomes the new trend as cities, states and the nation look to become more employee-friendly.
In the meantime, businesses in San Francisco, both small and large, will have to brace for the imminent financial and commercial impacts of having to compensate their employees for a six-week parental leave period.