California Adopts AB 1867 and Expands the Paid Sick Leave Requirement to Include COVID-19

By SHLC on September 18, 2020 in Legal Update
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On September 9, 2020, California AB 1867 became effective. The new law, codified as Labor Code sections 248 and 248.1 requires employers with 500 or more employees to provide supplemental paid sick leave for their California workers.  The new law also applies to employers of health care providers and first responders excluded by the federal Families First Coronavirus Response Act (FFCRA). This new paid sick leave requirement is in addition to the 24 hours or three days of paid sick leave required under the Healthy Workplace Healthy Family Act of 2014.

Background

Since March 2020, various local, state, and federal governments have passed laws requiring employers to provide paid sick leave for absences related to COVID-19. For example:

  • On April 1, 2020, the federal FFCRA, which included the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family and Medical Leave Expansion Act (EFMLEA), went into effect. Read our blog here for more information.
  • On April 16, 2020, Governor Gavin Newsom signed Executive Order N-51-20 (Executive Order), providing supplemental paid sick leave for food sector workers who work for a “hiring entity” employing 500 or more employees nationwide. The order was expansive, covering employees such as farmworkers and those working in the retail food supply chain, including pick-up, delivery, supply, packaging, retail, and preparation. Read our blog here for more information.
  • Local governments like San Francisco, Los Angeles, Long Beach, and several others also adopted a paid sick leave requirement geared towards employers with 500 or more employees. Read our blog here for more information for a list of local ordinances adopted as of April 1, 2020.

AB 1867 Requires Employers to Provide COVID-19 Supplemental Paid Sick Leave

The California Legislature, through AB 1867, requires employers to provide COVID-19 supplemental paid sick leave (SPSL) under Labor Code sections 248 or 248.1.

Labor Code section 248. This section adopted most of the provisions of the Executive Order N-51-20 (see our blog here). The bill’s provisions apply to food sector workers employed by industries or occupations under Wage Order No. 3, 8, 13 and 14, a food facility as defined under Section 113789 of the Health and Safety Code, and any transportation network company (e.g., Uber, Lyft).

Labor Code section 248.1. The Legislature also extended the right to SPSL to non-food sector workers in newly enacted Labor Code section 248.1. The law applies to employers with 500 or more employees, as well as employers, including public entities, who decided to exercise their ability to exclude “health care providers” and “emergency responders” from paid leave under the FFCRA.

Labor Code Sections 248 and 248.1 are similar, and both impose requirements already existing under California’s Paid Sick Leave law. Unlike the Healthy Workplace Healthy Family Act of 2014, AB 1867 does not include a collective bargaining exemption.

Effective Date of SPSL

AB 1867 went into effective on September 9, 2020. Employers subject to the Executive Order (i.e., food sector workers) were required to provide applicable leave starting April 16, 2020, and that requirement continues. All other employers must begin to provide SPSL by September 19, 2020.

The leave for food sector workers applies to employees and independent contractors alike. However, leave for non-food sector workers (Labor Code section 248.1) does not apply to independent contractors.

Under the FFCRA, employers can exclude “health care providers” and “emergency responders” from paid sick leave and/or expanded family and medical leave. Not so under Labor Code 248.1. Employers, including public entities that opted to use the health care provider and emergency responder exemptions must now provide SPSL without regard to the size of their employer. AB 1867 refers to the FFCRA in defining the terms health care provider and emergency responder. See the Families First Coronavirus Response Act: Questions and Answers Question #56 and #57. Also, note that the Department of Labor has revised its definition of “health care providers” and “emergency responders.”

SPSL will expire on December 31, 2020, on the same date that the FFCRA is set to expire, unless, of course, the expiration date for the FFCRA is extended. If SPSL expires while an employee is taking SPSL, the employee can finish taking the full leave entitlement.

Notice Requirements

The Labor Commissioner has prepared two notices that an employer must display in a conspicuous place. The employer will need to select the appropriate notice.

Wage Statement Requirement

Labor Code section 246(i) requires that employers notify employees each pay period of the paid sick leave they have available for use. Employers can include the balance on a wage statement or on a separate written document provided to employees when they are paid. Labor Code section 246(i) applies to non-food sector employees subject to Labor Code 248.1. Employers of food sector employees may want to consult with legal counsel to determine if they should also provide notice on the employee paystub. However, the requirement in subdivision (i) of Section 246 is not enforceable until the next full pay period following the date of enactment of this section. The Labor Commissioner’s FAQ does not address the number of hours that must be included in the wage statement or separate written document. Employers must retain records documenting the hours worked and leave provided for at least three years.

COVID-19 Reasons for Leave

To receive SPSL, the employee must leave the person’s home or other place of residence to perform work for or through the person’s employer and must be unable to work for the following reasons:

  • The worker is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
  • The worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19; or
  • The worker is prohibited from working by the worker’s hiring entity due to health concerns related to the potential transmission of COVID-19.

The “quarantine or isolation order” means a quarantine or isolation order that is specific to the worker’s circumstances, not a general stay-at-home order. For example, an order that directs individuals who live with someone who has COVID-19 to quarantine themselves would satisfy the eligibility requirement for taking SPSL.

Employers must provide SPSL upon oral or written request. The employee does not need to provide a certification from a healthcare provider before taking such leave. Depending on the circumstances, an employer may request documentation before paying the sick leave, if the employer has other information indicating that the employee is not requesting SPSL for a valid purpose.

Employers may not require the use of any other paid or unpaid leave before using SPSL.

Amount of Leave

The amount of leave an employee is able to take depends on their work schedule.

  • 80 hours for those considered full-time workers, in addition to any other accrued paid sick leave.
  • For part-time workers with a normal weekly schedule, the number of hours the worker is normally scheduled to work over two weeks.
  • For part-time workers with variable schedules, 14 times the average number of hours worked per day over the past 6 months.
  • For workers who have worked fewer than 6 months but more than 14 days, the number of hours worked done over the entire period.
  • For newly hired workers who have worked 14 days or fewer, the number of hours worked over the preceding two weeks.

The Labor Commissioner has set forth examples on their webpage along with additional information on AB 1867. See FAQs on Supplemental Paid Sick Leave for California Workers at Companies with 500 or More Employees Nationwide and for Health Care Providers and First Responders excluded from the federal COVID-19 Related Paid Sick Leave.

Rate of Pay

The employer must pay the highest of the following, not to exceed $511 per day and $5,110 in the aggregate:

  • The regular rate of pay for the last pay period;
  • The California minimum wage; or
  • The local minimum wage.

For non-food sector workers, the employee must receive the rate of pay for the last pay period, including pursuant to the collective bargaining agreement that applies.

Also, if an employer must provide SPSL at a different rate due to a local supplemental paid sick leave law, the employer must provide leave at a rate that would ensure compliance with both the local and California law, i.e., the higher of the rates required.

Prohibitions and Penalties

AB 1867 also revised Labor Code 248.5, which prescribes the Labor Commissioner’s enforcement procedures. The Labor Commissioner can order appropriate temporary relief to mitigate the alleged violation or to maintain the status quo pending a full investigation or “hearing through the procedures set forth in Sections 98, 98.3, 98.7, 98.74, or 1197.1, including by issuance of a citation against an employer who violates this article, and by filing a civil action.” The hearing process is known as a Berman hearing. For more information on Berman hearings, read our blog or visit the Labor Commissioner’s webpage by clicking here.

AB 1867 incorporates the existing provisions prohibiting discrimination and retaliation. The employer may be subject to an administrative penalty of at least $250 per day, but not to exceed $4,000 in the aggregate. The Labor Commissioner or the Attorney General may also bring a lawsuit to collect other legal or equitable relief, including reinstatement, back pay, the payment of sick days unlawfully withheld, and liquidated damages. Employees may file a claim or report of alleged violations with the Labor Commissioner.

Other AB 1867 Provisions

AB 1867 requires that food facility employers permit employees to wash their hands every 30 minutes and additionally as needed. AB 1867 also adds Government Code § 12945.21 that adds a small employer family leave mediation pilot program under the California Department of Fair Employment and Housing (DFEH).

Takeaways for Affected Employers

  • Review the FAQs provided by the Labor Commissioner.
  • Download the applicable notice(s) (see link above), post it, and distribute it to employees.
  • Immediately review and update paid sick leave policies.
  • Create a new line item on the wage statements that differentiates between the 24 hours or three days of paid sick leave and SPSL hours, including the amount available and used.
  • This and other new California laws for employers will be discussed at our upcoming California Wage and Hour Law Update on October 20, 2020. For more information on these and other events, visit our Events Page.