Have You Determined Whether Your Sick Leave Policy Is Compliant With California’s New Paid Sick Time Law?

Effective July 1, 2015—All California Employers Must Offer Paid Sick Time To Part-Time, Temporary and Full-Time Employees To Care for Themselves, Extended Family, and Victims of Domestic Violence

On September 10, 2014, Governor Jerry Brown signed the Healthy Workplaces, Healthy Families Act of 2014 (the “Act”), which provides paid sick days to millions of Californians—roughly 40% of the state’s workforce—who do not currently earn this benefit. The Act does not apply just to employers who currently provide no paid sick leave benefit to their employees; it also applies to employers who already provide paid sick leave or paid time off benefits to their employees. Accordingly, all employers must carefully review the Act to make certain they are compliant by July 1, 2015. The Act applies to all employers, all employees (with few exceptions) and provides a wider range of circumstances under which leave may be taken. It also provides a more expansive definition of “family member” compared to those found in most paid leave policies.

What Must Employers With No Current Paid Sick Leave Benefit Know? The Act applies to all employers, regardless of size. It also applies to all employees, exempt and non-exempt, as well as part-time, temporary and per diem employees (with few exceptions). Thus, an employee who, on or after July 1, 2015, works in California for 30 or more days within a year from the commencement of employment is entitled to paid sick days, to be accrued at a rate of no less than one hour for every 30 hours worked. Employees must have been employed for 90 days before they may begin using their accrued sick leave, even though they cannot begin accruing the leave until the commencement of employment or July 1, 2015, whichever is later. This means employees may meet the employment requirement before July 1, 2015.

Exempt employees will be deemed to work 40 hours per week for accrual purposes, unless their normal workweek schedule is less than 40 hours, in which case they will accrue paid sick leave based upon that normal workweek.

The sick time may be used for a variety of purposes and is not limited to the health condition of the employee. Employees are entitled to use accrued time for the diagnosis, care or treatment of an existing health condition of, or preventive care for, an employee or an employee’s family member, which includes spouses, registered domestic partners, biological, adoptive or foster parents, children, grandparents, grandchildren and siblings. Sick leave may also be used for victims of domestic violence, sexual assault or stalking.

Accrued paid sick days shall carry over to the following year of employment. However, an employer may limit an employee’s use of paid sick days to 24 hours or three days in each year of employment. If an employer provides the full amount of leave (24 hours or three sick days) at the beginning of each year, then no accrual or carry-over is required.

The Act has many nuances and details that require close attention, such as providing written notice to employees setting forth the amount of paid sick leave available to the employee. Employers may provide this information on an itemized wage statement or a separate writing on the designated pay date. Employers are also permitted to cap employees’ accrual and use of paid sick leave. Finally, the Act mandates posting and record retention requirements.

What Must Employers With Existing Paid Leave Policies Know? Employers that already have paid leave or paid time off policies are not required to provide additional paid sick leave, provided the employer makes available an amount of leave that may be used for the same purposes and under the same conditions as the Act and the policy either (1) satisfies the accrual, carry-over, and use requirements of the Act, or (2) provides at least 24 hours or three days of paid sick leave, or equivalent paid leave or PTO, for employee use at the beginning of each year of employment or calendar year.

To ensure your company is compliant with the Healthy Workplaces, Healthy Families Act of 2014, please contact Rhonda L. Nelson at rln@severson.com or Danielle M. Ellis-Andrews at dme@severson.com.