California’s Healthy Workplaces, Healthy Families Act of 2014 requires all employers to provide a set amount of paid sick leave (PSL) to employees working in California effective July 1, 2015, or on the first day of employment for new employees.
The law establishes minimum requirements; however, employers have the option to provide more sick time off than the minimum required under the act or to combine the time into a personal time off (PTO) policy.
In addition to California’s mandatory PSL law, employers should review local ordinances that might also provide PSL benefits. This resource is limited to covering the requirements of the state PSL law and does not provide specific details on the local ordinance requirements.
PSL can be calculated using several methods depending on which option the employer chooses to provide the leave.
An employer may use a different accrual method, other than providing one hour per every 30 hours worked, provided that the accrual is on a regular basis so that an employee has no less than 24 hours of accrued sick leave or PTO paid time off by the 120th calendar day of employment or each calendar year, or in each 12-month period.
If an employer already had a more generous PTO or PSL policy in place prior to January 1, 2015, the employer may continue to use the pre-existing accrual method as long as the accrual method meets the requirements below. These pre- existing policy accrual methods can be grandfathered in so long as certain conditions are met.
In order to avoid the administrative burden of tracking of accrual and carry-over, employers have the option to provide the time using a “lump-sum method” that grants the full amount of leave at the onset of the benefit year. The employee is provided the time, not a payment of wages, in advance for mandated PSL use.
With this method, an employee does not carry -over unused time at the end of the benefit year. The employee will receive 24-hours or three new PSL days at the beginning of the established benefit year.
The policy must satisfy the following requirements:
If an employer chooses any one of the accrual options, the employer should consider whether it wants to institute a cap on the maximum accrual. Any accrued but unused time must carry over to the following year of employment. However, employers are allowed to cap the amount of PSL carried over to the next year at 48 hours or six days.
If an employer does not cap the accrual by policy, a full-time employee (40 hours a week with no overtime) could potentially accrue more than 69 hours of PSL per year under the statutory accrual method, and be allowed to carry that over to the next year. This is nearly nine days per year if the employee works a 40-hour workweek.
Employers are encouraged to confirm that these annual and carry over accrual caps are in place with their payroll administrators as many of these providers rely on the employer to inform them of these limits. Payroll companies cannot be held responsible for employees who earn more than their employer’s intended limits, nor can employers take away time earned beyond the limits of the employer’s policy.
Employers who work an established alternative workweek
For those employers who work an established alternative workweek, the law as written requires 24 hours or three days of PSL, based on a standard eight-hour day/40-hour week schedule. The law does not consider employers whose employees have elected an alternative workweek schedule. Employees should be given the greater of either 24 hours or three days of PSL, regardless of whether the front-loading or accrual method is selected. This means that employees whose regular workday is 10 hours would get the greater of 24 hours or three 10-hour days.
The labor commissioner’s office issued an opinion letter that answers questions relating to how an employer provides “24 hours or three days” of PSL when you have employees that don’t work a traditional eight-hour day schedule.
Employers must allow employees to use the time for the diagnosis, care, or treatment of an existing health condition, or preventive care, for themselves or a “family member.” For example, an employee could take PSL for a cold or other sickness, for a sick child, or for an annual physical or other preventive care, like a flu shot.
An employee can use the full amount of the paid sick days for a qualifying family member. Please note that local ordinances may have additional definitions of qualifying family members.
A family member under California’s sick leave law is a:
PSL may also be used for an employee who is a victim of domestic violence, sexual assault or stalking. For more information, see Domestic Violence, Sexual Assault and Stalking Victims’ Leave notice.
The law is silent on the topic of whether and employer may require the employee to provide a doctor’s note of the need for PSL. The law simply states that the employee must provide reasonable advance notification. The labor commissioner has stated that denying leave because an employee failed to provide a doctor’s note or other details about the leave may lead to a claim against the employer for violation of the law. As a best practice, unless the doctor’s note is required pursuant to another leave law, there is no provision allowing an employer to require it for PSL.
Employers must pay employees no later than the payday for the next regular payroll period after the sick leave was taken.
Hourly employees, need to be paid their regular or normal non-overtime hourly rate for the amount of time taken as PSL. For example, if an employee took two hours of PSL to attend a doctor’s appointment, they will be paid for those two hours at the same non-overtime hourly rate they would have earned if they had been working.
To determine the rate of pay, the employer may either:
For salaried employees, PSL is calculated in the same manner as wages for other forms of paid leave time (for example, vacation pay, paid -time off).
If an exempt employee has no paid sick leave (PSL), vacation or PTO accrued, or has used up all available PSL, vacation pay or PTO, you can make deductions from salary for full- day absences. To determine the daily rate, an employee’s annual salary should be divided by 52 for the weekly amount, then divided by the number of days the employee usually works in a week. The Division of Labor Standards Enforcement (DLSE) allows deductions of no more than one-fifth of a week’s salary for each day of absence, even if the employee normally works less than five days per week.
Deductions from salary for an exempt employee’s partial- day absence are not permissible. If an exempt employee is absent for a partial work day and has no PSL, vacation or PTO available, the employee must be paid for a full day if he/she performs any work that day.
Although you cannot deduct from an employee’s salary, you are allowed to deduct from an exempt employee’s PSL, vacation or PTO accrual bank for a partial-day absence. Here’s an example: Judy asks to leave work at 10 a.m. on a Friday for a medical appointment. Her normal scheduled hours are from 8 a.m. to 4 p.m. She has only two hours available in her accrued PSL bank. Because Judy worked two hours of her typical schedule, she must receive her full salary for the day. Even though she does not have enough time in her PSL bank to cover her absence, her employer cannot deduct from her salary for the time missed. The employer may, however, apply the two hours remaining in her PSL bank toward her salary for the day.
Read more in the Policies and Interpretations Manual from the Division of Labor Standards Enforcement.
PSL is a protected leave right afforded by law. Employers should not:
Employers must post a required Healthy Workplaces/Healthy Families Act of 2014 Paid Sick Leave poster*:
The employer must provide the employee with a written notice indicating the amount of sick time available to the employee at each pay period. You can provide this notice to the employee either:
Keep records for at least three years that document the:
If an employer does not keep adequate records, there is a presumption that the employee is entitled to the maximum number of hours accruable unless the employer can show otherwise by clear and convincing evidence.
The records must be available for inspection by the labor commissioner. The records must also be available for inspection by the employee upon reasonable request, as with other payroll records.
Some cities in California have local mandates that require additional sick leave for employees, in addition to the new sick leave law requirements. Often times, these local laws supersede the state’s PSL policy, especially those that provide greater sick leave benefits to employees. When the two laws differ, you must follow whichever is more generous to employees. This includes but is not limited to the following cities: