Well, this was inevitable….on October 4, 2023 Governor Newsom signed Senate Bill 616 (“SB 616”) into law amending California’s paid sick leave law (the Healthy Workplaces, Healthy Families Act of 2014) which changes include increasing the amount of leave that is provided each year and increasing the amount of time employees can carry over from year-to-year.
This law, which goes into effect January 1, 2024, applies to all jurisdictions within California, unless a local ordinance provides greater benefits to employees (e.g. Los Angeles requires 6 days/48 hours; Santa Monica mandates employees be provided up to 72 hours of paid sick leave.)
Generally, California’s paid sick leave (PSL) law currently provides that employees who work in California for the same employer for 30 or more days must accrue no less than one hour of paid sick leave per every 30 hours work; and employees are to be provided with no less than 3 days/24 hours of PSL per year, which can be provided on either an accrual basis of 1 hour of paid sick leave for each 30 hours worked, or on a “front loaded” basis where the employee is granted with the full amount of annual PSL each 12 month period of time.
What Has Changed
Accrual
Under the new law the accrual rate remains the same – one hour for every 30 hours worked but SB 616 increases the minimum amount of sick leave time eligible employees must be entitled to receive each year to 5 days/40 hours. Employers who prefer to use the “front load” method will now need to provide employees with 40 hours/5 days of paid sick leave in employees’ leave banks each year.
Accrual Method
Employers may use a different accrual method as long as eligible employees accrue:
- no less than 3 days/24 hours of paid sick leave by the end of their 120th day of employment; and
- no less than 5 days/40 hours of paid sick leave by the end of their 200th day of employment.
- For those employers who offer paid leave (such as PTO), the number of days of paid leave an employee is eligible to receive must increase from 3 days/24 hours within nine months of employment to 5 days/40 hours within six months.
Use Cap Increased
Current law permits employers to cap annual sick leave usage to 24 hours/3 days per year; the new law expands the permissible annual usage cap to 40 hours/5 days in each year of employment, calendar year or 12 month period of time, whichever is used for PSL accrual.
Carry Over Increased
SB 616 also raises the total amount of PSL that employers must allow employees to accrue over time and carry over from one year to the next – current law requires 48 hours/6 days; the new law provides for 80 hours/10 days. (NOTE: Los Angeles provides for a carry-over of 72 hours so Los Angeles employers will need to modify their sick leave policies.)
What Stays the Same
Use and Payment of PSL
The amended law does not modify the reasons for which an employee can take PSL, nor does it modify the manner in which PSL for non-exempt or exempt employees is to be paid. Employees also cannot be required to find their own replacement worker to cover any days during which the employee uses PSL.
Lending Time
The law does not change the provision that permits an employer to “lend” PSL to an employee in advance of accrual, at the employers discretion and with “proper documentation.”
Written Notice
SB 616 does not alter the requirement of an employer to provide an employee with written notice that sets forth the amount of PSL available, or paid time off leave an employer provides in lieu of PSL, on the employee’s itemized wage statement or a separate writing.
In-Home Supportive Service Providers and Employees Covered by CBAs
The bill amends the schedule for in-home supportive service providers (IHSS) to increase their PSL accrual to five days/40 hours in each year of employment.
New Poster
Once the new poster is updated, it can be found on the DLSE publications website.
What Do We Do Now
- Review your current PSL policy to determine if changes need to be made to the following areas and update your policy:
- accrual rate
- carry over
- cap on usage rate
- If the employer is in a city or county with a local ordinance that differs from the California PSL laws, determine if changes would need to be made (e.g. the PSL for employers in Los Angeles would need to be changed from a 72 hour carry over to an 80 hour carry over).
- Educate and remind managers and supervisors that employees have increased PSL benefits, increased carry over and increased caps on PSL and that employees cannot be disciplined nor retaliated against for taking legally authorized paid sick leave.
- Work with your payroll department or outsourced Payroll Company to ensure that the accrual and front loading allowances are correct, that the cap on accrual is updated and that wage statements accurately reflect the PSL to which each employee is entitled.
This Newsletter is intended as a brief summary of employment law. While every effort has been made to ensure the accuracy of the information contained herein, it is not intended to serve as “legal advice,” or to establish an attorney-client relationship. If additional information is needed on any of the topics contained herein, please contact our office. All rights reserved. ©2023.