San Francisco just became the first city in the United States to require employers to provide workers with up to six weeks of fully paid parental leave for the birth or adoption of a child. This benefit applies to mothers and fathers equally.
What Must Employers Provide As Parental Leave Benefits?
Under California’s existing Paid Family Leave Program (PFL), eligible employees are entitled to receive paid leave of 55 percent of their salary (subject to a maximum benefit) for up to six weeks. San Francisco’s new ordinance requires employers to supplement this paid family leave benefit by providing the remaining 45 percent of the salary.
However, if the employee’s salary exceeds the maximum benefit established by the California Employment Development Department, the employer’s supplement is similarly limited. Under the current PFL benefit, an employee is entitled to receive a maximum of $1,129 per week. Accordingly, under the new ordinance, employers would be required to pay a maximum of $924 per week to supplement the PFL benefit.
Who Is Eligible for This Benefit?
Eligible employees are those who: (1) have worked eight hours or more per week; (2) spend at least 40 percent of their work week within the city of San Francisco; (3) have worked for the covered employer for 180 days prior to start of the leave period; and (4) are eligible for benefits under California’s PFL program.
Who Does This Effect and When?
The ordinance will go into effect on January 1, 2017 for businesses that employ 50 or more employees (regardless of location). It expands to businesses that employ 35 or more employees beginning on July 1, 2017, and finally to businesses that employ 20 or more employees beginning on January 1, 2018.
What Does This Mean for Employers?
In the immediate future, employers with any employee working within the city of San Francisco should review and revise their existing policies to ensure compliance with the new ordinance. However, this legislation follows closely on the heels of New York’s enactment of a statewide paid family leave law and demonstrates a trend across the country. Employers should prepare for similar legislation authorizing paid benefits for parental leave in other jurisdictions.