Seyfarth Synopsis: On March 18, 2021, the California Senate voted to revive and expand the Covid-19 related supplemental paid sick leave law that expired on December 31, 2020. Governor Newsom is expected to sign the legislation soon. The law will become effective immediately once signed, with a short grace period for compliance, and will apply retroactively to January 1, 2021 (thereby requiring back payments). The new law will expand the scope of covered employers, as well as the covered reasons for taking the leave. The new law is set to expire September 30, 2021.

Refresher On The Recent History of CA-SPSL

On September 9, 2020, California enacted a state-wide Covid-19 supplemental paid sick leave law to fill gaps left by the federal Families First Coronavirus Response Act (“FFCRA”). This law, a budget trailer bill, went into effect immediately as California’s Supplemental Paid Sick Leave (“CA-SPSL”).

The old CA-SPSL law required most employers with over 500 employees to provide up to 80 hours of paid leave for three Covid-related reasons, if the employee had to leave their home to perform work: (1) when an employee was subject to an isolation or quarantine order, (2) when a healthcare provider recommended the employee isolate or quarantine, or (3) when the company prevented an employee from working due to Covid-19 transmission related concerns. The leave was automatically set to expire December 31, 2020, unless the FFCRA was extended. At the eleventh hour, the Labor Commissioner determined that the FFCRA’s tax credit expansion would not trigger an expansion of the old CA-SPSL law, which then expired at the end of the year.

For the next few months, employers had to wonder whether or how California would extend paid sick leave for Covid-related reasons. Local governments throughout California—Los Angeles City and County, Oakland, Sacramento City and County, San Francisco, San Jose, and others—enacted their own Covid-related paid sick leave laws to fill in the gaps. Meanwhile, as we reported, the California Legislature considered bills that would expand Covid-related SPSL obligations. Now that the Legislature has approved SB 95, the bill will likely become law soon.

What Are The Big Differences With The New CA-SPSL?

The New CA-SPSL Law Covers Additional Employers

Unlike the old CA-SPSL the law, which covered only employers with 500 or more employees, the new law would apply to employers with more than 25 employees.

Additional Covered Reasons For Leave

As noted above, the old law required employer-paid SPSL leave only under fairly narrow circumstances. The new CA-SPSL would greatly expand covered uses. It also permits employees to take paid leave whenever they are unable to work or telework, meaning that the new law would apply even to individuals who do not leave home for work.

The new covered reasons for leave include situations when the employee cannot work or telework because the employee:

  • is subject to a quarantine or isolation period related to Covid-19 as defined by an order or guidelines of the State Department of Public Health, the CDC, or a local health officer with jurisdiction over the workplace,
  • has been advised by a health care provider to self-quarantine due to concerns related to Covid-19,
  • is attending an appointment to receive a vaccine for protection against contracting Covid-19,
  • is experiencing symptoms related to a Covid-19 vaccine that prevent the employee from being able to work or telework,
  • is experiencing symptoms of Covid-19 and seeking a medical diagnosis,
  • is caring for a family member who is subject to a quarantine or isolation order or guidelines, or who has been advised to self-quarantine by a health care provider, or
  • is caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to Covid-19.

Retroactive Effect

The obligation to provide leave would begin 10 days after the law is enacted, at which point the requirements would apply retroactively, to January 1, 2021.

Employers would be required to issue retroactive payments to employees who took leave for a covered reason. For example, if an employee got vaccinated in February 2021 and put in a request, the employee would be eligible for a retro-payment of CA-SPSL under the new law. The retroactive payment would have to be paid “on or before the payday for the next full pay period after the oral or written request of the covered employee.” Retroactive payments would have to be reflected on written notices, and this obligation would be in addition to the pre-existing obligation to provide paid sick leave to employees who were already on paid leave when the previous law expired on December 31, 2020.

Employers would need to begin complying with the written notice requirements the next full pay period following the effective date of the legislation.

Amount of Leave

Like the old law, the new law would require employers to provide full-time employees with a new allotment of up to 80 hours of CA-SPSL for 2021 (with some exceptions for firefighters). Note that a prior version of the new law was set to implement an allotment of up to 80 hours per year, if federal law extended the Emergency Paid Sick Leave Act beyond 2021, but that annual renewal of the grant has been deleted from the operative version of the law.

Part-time employees who work normal schedules would be entitled to the total number of hours they are typically scheduled to work in a two-week period. Part-time employees with variable schedules would be entitled to the average number of hours in the preceding six months, or during the period the employee has worked for the employer. Employees who have worked 14 days or fewer would be entitled to receive the total number of hours they have worked for the employer.

Like the previous law, CA-SPSL would have to be made available upon written or oral request.

Rate of Pay Amended, Cap Tied To Federal Law

The new law would more closely align with the method of payment for regular non-Covid-related sick leave. It would specify that nonexempt employees must be paid at the highest of (i) their regular rate during the workweek in which they take the leave, (ii) the total wages (not including overtime) divided by the total hours worked in the past 90 days of employment, or (iii) the state or local minimum wage. Exempt employees should be paid through the same method they are normally paid leave. This would be good news for employers that were trying to figure out multiple calculations in payroll tied to different types of paid sick leave—recall the last version of CA-SPSL required pay at the regular rate of pay from the pay period prior to the leave.

The new law would also track FFCRA’s daily cap of $511, and aggregate cap of $5,110 (unless federal legislation increases these caps, in which case, the new federal cap will apply).

Notification Requirements

As with the previous (non-food sector) version of the leave, employers have to provide the available leave balance on wage statements or in a separate writing. Thankfully, now, when employees have variable schedules, employers can comply with their obligation by performing an initial calculation of paid leave available, and then indicate “variable” next to that calculation. But updated calculations would need to be provided upon request, or when the employee requests to use the leave.

Within seven days of the law’s enactment, the Labor Commissioner will publish a required notice of the new law to post or provide to employees.

Interplay With Other Paid Leave

The new CA-SPSL leave will be in addition to other paid sick leave that employees have available, and employers cannot require employees use other paid or unpaid time off before using new CA-SPSL. But the law clarifies that “an employer may require a covered employee to first exhaust their Covid-19 supplemental paid leave” before an employer will be required to pay out earnings continuation under the Cal/OSHA Emergency Temporary Standard for absences related to Covid-19 exposure or illnesses in the workplace.

In addition, Covid-related paid leave provided at the same (or greater) rate for the same covered reasons since the beginning of the year may be counted towards the hours the employer is required to provide. This offset may include leave provided under any federal or local law that was effective on or after January 1, 2021 (but not regular non-Covid-related California paid sick leave). For example, if an employer provided leave under a county ordinance while an employee was quarantining in January 2021, or if an employer provided paid leave while an employee took time off of work to be vaccinated in February 2021, this leave could be offset against the new CA-SPSL allotment.

In-Home Providers

A separate section under what will become Labor Code section 248.3 outlines similar requirements for providers of in-home supportive services.