On September 10, 2014, Governor Brown signed Assembly Bill 1522 (“AB 1522”), codified as Labor Code sections 245 through 249, enacting the Healthy Workplaces, Healthy Families Act of 2014 (“Paid Sick Leave law”). Effective July 1, 2015, this new Paid Sick Leave law entitles an employee to the accrual of up to three paid sick days in a 12-month period for the diagnosis, care, or treatment of an existing health condition or preventative care for an employee or an employee’s family members. It also provides paid sick days for an employee for certain purposes related to being a victim of domestic violence, sexual assault, or stalking. In preparation for the effective changes on July 1, 2015, all California employers should review their current sick leave policies and practices to ensure compliance with the Paid Sick Leave law. Below is a summary of the Paid Sick Leave law and how it can apply to your agency.
Overview of the Paid Sick Leave Law
Prior to AB 1522, there was no law in California mandating sick leave (paid or otherwise) for employees. The Legislature’s intent in enacting the Paid Sick Leave law is to ensure that employees can address their own health needs and the health needs of their families and to decrease public and private health care costs by enabling employees to seek early and routine medical care and to address violence, sexual assault, or assault.
The Paid Sick Leave law requires nearly all employers to provide at least three sick days to each employee per year. All employers, with at least one employee, are subject to the Paid Sick Leave law, including state and municipal employers. There is no minimum number of employees needed in a workplace for the Paid Sick Leave law to apply.
The Paid Sick Leave law only exempts the following employees:
- Employees covered by a valid collective bargaining agreement if the agreement expressly provides paid sick days or paid leave for sick days, final and binding arbitration of disputes about paid sick days, premium wage rates for all overtime, and a regular hourly rate of pay of not less than 30 percent more than the state minimum wage rate;
- Employees in the construction industry covered by a valid collective bargaining agreement;
- Providers of in-home support services; and
- Employees of an air carrier flight deck or cabin crew members.
Under the Paid Sick Leave law, an employee is entitled to paid sick days if he or she works in California for 30 or more days within a year from when employment commences. As a result, the Paid Sick Leave law applies to most any employee – including temporary, extra help, part-time, and seasonal employees who work 30 or more days within a year from when employment commences. The Paid Sick Leave law does not provide any other eligibility requirements.
Employees accrue paid sick leave at the rate of at least one (1) hour per every 30 hours worked – beginning on the first date of employment or July 1, 2015, whichever is later – up to twenty-four (24) hours [three (3) days] per 12-month employment year. For employees exempt from overtime requirements, their workweek is considered 40 hours for purposes of the Paid Sick Leave law. Employees are entitled to request and use accrued paid sick days beginning on the 90th day of employment. However, an employer may lend paid sick days to an employee in advance of accrual at the employer’s discretion. The rate of pay shall be the employee’s hourly wage. If the employee in the 90 days of employment before taking accrued sick leave had different hourly pay rates, was paid by commission or piece rate, or was a nonexempt salaried employee, then the rate of pay shall 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. An employer shall provide payment for covered sick leave taken by an employee no later than the payday for the next regular payroll period after the sick leave was taken.
The Paid Sick Leave law also requires employers to allow employees to carry over paid sick days to the following year of employment, up to an accrual cap of six (6) days/forty-eight (48) hours of sick leave. Although sick leave can be carried over year to year within the cap limit, an employer can limit the number of sick leave days used to three (3) days in any one year.
Under the Paid Sick Leave law, an employee may determine how much paid sick leave needs to be used, provided that an employer may set a reasonable minimum increment, not to exceed two hours, for the use of such covered sick leave. If the need for paid sick leave is foreseeable, the employee shall provide reasonable advance notification. If the need for paid sick leave is unforeseeable, the employee shall provide notice of the need for the leave as soon as practicable.
Employer Obligations Under the Paid Sick Leave Law
To comply with the Paid Sick Leave law, an employer must satisfy the following obligations:
- An employer must comply with the sick day accrual, carry over, and use requirements of the Paid Sick Leave law (as outlined above);
- An employer shall not deny an employee the right to use accrued sick days, discharge, threaten to discharge, demote, suspend, or discriminate against an employee for using accrued sick days;
- At the time of hiring, an employer shall provide each employee with written notice of his or her rights under the Paid Sick Leave law;
- An employer shall provide written notice of the amount of paid sick days available on an employee’s itemized wage statement or on a separate writing provided on the designated pay date with the employee’s payment of wages;
- An employer shall display a poster in a conspicuous place informing employees of their rights under the Paid Sick Leave law. Employers can obtain a poster containing all of the required information from the Labor Commissioner; and
- An employer shall keep records documenting the hours worked, paid sick days accrued, and paid sick days used by an employee for at least three years.
Employers Who Already Have Sick Leave Policies
Many public agencies and private employers currently have sick leave policies in place, whether negotiated in a collective bargaining agreement (CBA) or memorandum of understanding (MOU); or provided by rule/policy. Employers who already have a paid sick leave policy or paid time off (PTO) policy in place are not required to provide additional sick days if their current policies satisfy the accrual, carry over, and use requirements of the Paid Sick Leave law and they provide no fewer than three paid sick days (24 hours) each year. The Paid Sick Leave law sets the minimum accrual rate, and therefore, does not prohibit an employer from adopting an accrual rate more generous than one hour per every 30 hours worked. In addition, if an employer’s current policy does not allow for sick leave to carry over year to year, it must amend its policy to comply with the minimum carry over requirement up to an accrual cap of six (6) days/forty-eight (48) hours of sick leave.
Intersection of Paid Sick Leave Law with Other Current Laws
The Paid Sick Leave law will intersect with other laws that are currently on the books, including the following:
Labor Code Section 226 – Itemized Wage Statements
Private sector employers are currently required under Labor Code section 226 to provide an itemized wage statement of gross/net wages earned, hours worked, hourly/piece rates, deductions made, dates of pay period, employee name, and employer name and address. Public sector employers are exempt from Labor Code section 226. New Labor Code section 246(h) of the Paid Sick Leave law requires that all employers now provide in writing the amount of paid sick leave available (or PTO leave in lieu of sick) either on the itemized wage statement used in compliance with Section 226 or in a separate writing provided on the designated pay date with the employee’s payment of wages.
Labor Code Sections 230 and 230.1 – Prohibition of Discrimination Against Victims of Domestic Violence, Sexual Assault, and Stalking for Taking Leave
Labor Code sections 230 and 230.1 prohibit an employer from discharging, discriminating, or retaliating against an employee who is a victim of domestic violence, sexual assault, or stalking for taking time off of work to obtain or attempt to obtain relief. The Paid Sick Leave law expands on this by providing employees with the ability to use covered paid sick days for taking time off from work to obtain or attempt to obtain any relief, including, but not limited to, a temporary restraining order, restraining order, or other injunctive relief, to help ensure the health, safety, or welfare of the themselves or their child(ren) because they are victims of domestic violence, sexual assault, or stalking. The Paid Sick Leave law also provides for an employee who is a victim of domestic violence, sexual assault, or stalking to use covered paid sick leave to attend to any of the following:
- To seek medical attention for injuries caused by domestic violence, sexual assault, or stalking.
- To obtain services from a domestic violence shelter, program, or rape crisis center as a result of domestic violence, sexual assault, or stalking.
- To obtain psychological counseling related to an experience of domestic violence, sexual assault, or stalking.
- To participate in safety planning and take other actions to increase safety from future domestic violence, sexual assault, or stalking, including temporary or permanent relocation.
The Paid Sick Leave law would also prohibit discharge, discrimination, or retaliation against a victim of domestic violence, sexual assault or stalking for using covered sick leave days for these purposes noted above.
Labor Code Section 233 – Sick Leave to Care for a Child, Parent, Spouse, or Domestic Partner
Labor Code section 233 applies to employers who, at their discretion, adopted paid or unpaid sick leave policies. Section 233 requires employers who provide sick leave to permit an employee to use up to one-half of his or her annual allotment of sick leave to attend to the illness of a child, parent, spouse, or domestic partner. For example, an employee who accrues one sick day per month (12 sick days per year), can use six sick days (half of the annual accrual) to care for a family member.
The Paid Sick Leave law is broader than Section 233 by also permitting covered sick leave to be taken to care for a parent-in law, grandparent, grandchild, or a sibling, in addition to child, parent, spouse or registered domestic partner as currently required under the terms of Section 233. This will result in the potential overlap of protected sick leave reasons both under the Paid Sick Leave law and Labor Code section 233. As a result, employers will need to carefully review their sick leave policies and practices to ensure that they are properly providing sick leave and its protections in accordance with both laws.
Practical Tips to Comply with AB 1522
Even though the Paid Sick Leave law does not go into effect until July 1, 2015, public and private employers should become familiar with the requirements of this new law now. They should be ready to meet all of the employer obligations and to post the required notices by July 1, 2015. If employers have no current sick leave policy in place, they should start drafting a policy to ensure compliance with the Paid Sick Leave law. For employers who have already adopted a sick leave policy, they should start reviewing their sick leave policies and practices to ensure compliance with the Paid Sick Leave law. If sick leave policies are adopted through a negotiated CBA or MOU, employers may need to review such policies to determine what amendments need to be made and may be obligated to meet and confer with the applicable bargaining unit to modify such policies. However, employers will still have to meet the minimum requirements of the Paid Sick Leave law regardless of whether new CBA/MOU provisions can be negotiated prior to the July 1, 2015 effective date.
Employers need to be aware that part-time, extra help, temporary, and seasonal employees may now be entitled to paid sick leaves. Employers should be prepared to start documenting accrual of paid sick leave for all employees who work at least 30 days from the beginning of employment or July 1, 2015, whichever date is later. Employers should also prepare to enforce the request procedures and employee notice requirements of paid sick days. Foreseeable sick leave requires advance notification, while unforeseeable sick leave requires notice as soon as practicable. This will allow employers to differentiate between paid sick leave for permissible purposes and excessive and unexcused absenteeism. On a similar note, employers may need to examine excessive absenteeism policies and make any adjustments in light of protected sick leave usage under the Paid Sick Leave law.
The Paid Sick Leave law brings forth major changes in sick leave for all California employers. Employers therefore will need to ensure that current sick leave policies and procedures are properly updated to ensure that their workplace is prepared to comply with these changes on July 1, 2015.