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THE HEALTHY WORKPLACES, HEALTHY FAMILIES ACT OF 2014
California is now the second state in the nation to implement paid sick leave state-wide, passing “The Healthy Workplaces, Healthy Families Act of 2014”. (AB 1522; California Labor Code § 245 et seq.)
Here is what you need to know about this law:
Beginning July 1, 2015, every employee, whether exempt or non-exempt, full-time or part-time, who works in California for at least 30 days within a year from the commencement of employment, will be entitled to accrue paid sick leave at the employee’s regular rate of pay. Note that this could mean that employers who have employees who live outside of California, but who travel into California to perform work for more than 30 days within a year, could be eligible for sick leave under this Act.
There is no small employer exemption.
There is no minimum number of employees requirement.
The following employees are exempt from this law:
(1) employees covered by a valid collective bargaining agreement that expressly provides for the wages, hours, and working conditions and that also expressly provides for paid sick days and other requirements
(2) persons employed in the construction industry covered by a valid collective bargaining agreement that satisfies certain requirements
(3) a provider of in-home support services under specified parts of the Welfare and Institutions Code
(4) persons employed by an airline as a flight deck or cabin crew member subject to certain provisions of the federal Railway Labor Act.
Providing Employees with Sick Leave Time
Employers can provide employees with paid sick leave by the accrual method or the lump sum method.
Sick leave accrues at a rate of not less than one hour per every 30 hours worked commencing on the first day of employment or the effective date of the new law (July 1, 2015), whichever is later. Exempt employees are deemed to work 40 hours per week, unless the employee normally works a workweek of less than 40 hours.
Employer can choose to cap accrual at 48 hours (6 days) of sick leave per year.
An employer may limit an employee’s use of accrued paid sick days to three days or 24 hours per year of employment.
Accrued but unused sick days carry over to the following year, however, that carry-over is subject to the accrual cap (if the employer chooses to implement one.)
Lump Sum Method:
Employers can choose to provide paid leave of no less than 24 hours or three days, with no accrual or carry over required, if the full amount of leave is received by the employee in a lump sum at the beginning of the year.
The beginning of the year is either July 1, 2015, or the date of hire, whichever is later.
Employers with paid sick leave or PTO policies do not need to change anything if their current policy:
(1) Makes available an amount of leave that may be used for the same purposes as the new law (detailed below); and (2) Satisfies the accrual, carry over, and use requirements of the Act; or Provides for no less than 24 hours (3 days) of paid sick leave, or equivalent paid leave or paid time off per year. However, all employers must still comply with the record keeping and notice requirements (detailed below).
An employer may lend paid sick days to an employee in advance of accrual, at the employer’s discretion and with proper documentation.
Usage and Pay
An employee may use accrued paid sick leave beginning on the 90th day of employment.
Sick leave may be used for the diagnosis, care, or treatment of an existing health condition, or preventive care (including annual physical or flu shots) for an employee or an employee’s family member. Family members include the employee’s parent, child, spouse, registered domestic partner, grandparent, grandchild, and sibling.
Sick leave may also be used for victims of domestic violence, sexual assault, or stalking.
For partial days i.e. using sick leave for a doctor’s appointment, an employer can require the employee to take at least two hours of leave, but otherwise the determination of how much time is needed is left to the employee.
Employers must permit the employee to use the paid sick leave upon an oral or written request.
If the need is foreseeable the employee must give reasonable advance notice, but where the need is unforeseeable the employee need only give notice as soon as practicable.
The law forbids requiring an employee to find a replacement as a condition for using leave.
Employees must be paid at their regular hourly rate. If the employee’s pay fluctuates – for example, pay on a commission or piece rate – the total compensation for the previous 90 days is divided by the number of hours worked to determine the rate of pay.
An employer must provide payment for sick leave taken by an employee no later than the payday for the next regular payroll period after the sick leave was taken.
Notice and Record Keeping Requirements
Starting July 1, 2015, employers must show, on employee’s pay stub or a separate document issued the same day as the paycheck, how many days of sick leave the employee has available.
The employer is obligated to post notice of the Act. This requirement went into effect on January 1, 2015.
All non-exempt employees must be provided an individualized Notice to Employee that includes paid sick leave information.
Termination of Employment
The employee is not entitled to compensation for unused sick leave days.
Compare to accrued but unused vacation days or PTO. Those are earned wages and compensation is required if they remain unused at end of employment.
However, if an employee leaves the employment, but returns within 12 months, the accrued sick leave must be restored. In addition, the 90 day probationary period starts where the employee left off. This is something to keep in mind for seasonal employees.
Employers may not deny an employee the right to use accrued sick days, discharge, threaten to discharge, demote, suspend, or in any manner discriminate against an employee for using or attempting to use accrued sick days.
The Act provides for a variety of monetary and non-monetary remedies for violations of its various provisions.
The Act does not preempt local ordinances that provide for greater accrual or use of sick leave by employees. This means employers in San Francisco and San Diego, which each have their own sick leave ordinances, will be required to provide sick leave that complies with both state and local laws.