Navigating California’s New Supplemental Paid Sick Leave Law – Guidance on Key Provisions and Common Employer Questions

On September 9, 2020 Governor Newsom signed AB 1867 into law, giving California employers just 10 days to implement new COVID-19 Supplemental Paid Sick Leave statewide.  Below we highlight the major provisions of the new law (Labor Code 248.1, or “LC 248.1”) as well as nuances employers should keep in mind as they put their program into place.  (For clarity, we refer to this new leave as “LC 248.1 leave” to avoid confusion between this new statewide mandate and other federal and local laws expanding available paid sick leave due to COVID-19.)

Which employers are covered?

Private businesses with 500 or more employees nationwide (including delivery and transportation network companies), as well as employers of certain healthcare providers or emergency responders not covered by the federal Families First Coronavirus Response Act (FFCRA), are required to provide their California-based employees with LC 248.1 leave.  Employers unsure whether they meet the 500-employee threshold are instructed to look to federal law (29 CFR § 826.40(a)).

Which employees are entitled to LC 248.1 leave?

“Covered employees” include individuals employed by a hiring entity (as defined in the statute) who leave their homes/residences to perform work for the hiring entity.  This means employees working fully remotely are not entitled to the new supplemental leave.

What reasons qualify for LC 248.1 leave?

Employees are permitted to take LC 248.1 leave for three specific reasons:

• The covered worker is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
• The covered worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19.
• The covered worker is prohibited from working by the covered worker’s hiring entity due to health concerns related to the potential transmission of COVID-19. (Note this reason only applies if the hiring entity bars the employee from working, and does not extend to more general employee concerns about potential exposure, )

How much LC 248.1 leave do employees get?

California employees are entitled to two weeks’ paid leave under LC 248.1, in addition to standard paid sick leave (under LC 246).  For full-time employees, this means a bank of 80 hours of LC 248.1 leave.  Part-time workers with regular weekly schedules are entitled to the total number of hours the employee is normally scheduled to work in a two-week period (e.g., 40 hours for a 50% FTE employee).  Computing the allotment of LC 248.1 leave for part-time employees with variable schedules is more complicated, but the California Labor Commissioner’s LC 248.1 guidance provides examples of permissible ways to calculate (see Item 16).

The law caps total payouts per employee under LC 248.1 at $511 per day and $5,110 total.

What about employers who already provided supplemental COVID-19-related sick leave?

If an employer already offered paid supplemental COVID-19 leave to employees prior to the new law taking effect – either due to a voluntarily-adopted policy, or to comply with a federal or local requirement – they can credit those hours towards an employee’s LC 248.1 entitlement in some circumstances.  The employer’s prior provision of leave must have been paid, and payable for the reasons set forth in LC 248.1; prior supplemental unpaid sick leave, or supplemental sick leave permitted for different reasons, does not qualify.  If the previously provided supplemental leave was paid out at less than the rate of pay LC 248.1 requires, an employer may retroactively “true up” the employee and then offset those hours against the LC 248.1 entitlement (rather than providing additional leave time).

Additional guidance from the California Labor Commissioner on the interaction of LC 248.1 and other supplemental leave requirements or offerings is available here (see Items 22-25).

Other details of the new leave law

While California employers may have already begun implementing LC 248.1, it’s worth double-checking to ensure practices comply with the host of requirements embedded in the new law, including:

• Beginning with the next full pay period following enactment (e., the next full pay period after September 9), and continuing for each pay period until LC 248.1 expires, employers must include a written notice to employees of the amount of LC 248.1 leave they have available, either on the employees’ wage statements or in a separate writing provided at the same time.
• Employers are required to provide employees with notice of the new law, but can do so by electronic means (g., e-mail) if covered workers do not frequent any physical workplace. The California Labor Commissioner published a model notice poster here.
• LC 248.1 states that employees “may determine how many hours of COVID-19 supplemental paid sick leave to use, up to the total number of hours to which the covered worker is entitled,” and that “the hiring entity shall make COVID-19 supplemental paid sick leave available for immediate use by the covered worker, upon the oral or written request of the worker to the hiring entity.”
• Although the text of the new law is silent as to what (if any) medical certification can be required of employees requesting LC 248.1 leave, the California Labor Commissioner’s view (see Item 7) is that “[a] hiring entity may not deny a worker COVID-19 Supplemental Paid Sick Leave based solely on a lack of certification from a healthcare provider.” The Commissioner also acknowledges, though, that “it may be reasonable in certain circumstances to ask for documentation before paying the sick leave when the hiring entity has other information indicating that the worker is not requesting COVID-19 Supplemental Paid Sick leave for a valid purpose.”
• The requirements of LC 248.1 expire on December 31, 2020 or upon the expiration of any federal extension of the FFCRA (which applies to private employers with fewer than 500 employees), whichever is later – so employers should ensure payroll and tracking systems are set up with the expiration date in mind.