Calif.: Paid Sick Leave Bill Moves Forward

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Known as the Healthy Workplaces, Healthy Families Act of 2014, Assembly Bill (AB) 1522 passed the Assembly along a party-line vote and is pending in the Senate. The bill would implement a number of new Labor Code provisions requiring employers to provide paid sick leave for their employees. It would apply to all employers regardless of size, and would include public employers, the state and municipalities.

After July 1, 2015, employees who work in California for seven or more days in a calendar year would accrue paid sick leave at a rate of no less than one hour for every 30 hours worked. Exempt employees would be deemed to work 40 hours per week for accrual purposes, unless their normal workweek schedule is less than 40 hours, in which case they would accrue paid sick leave based upon that normal workweek. Employees would be entitled to use accrued paid sick days beginning on the 90th calendar day of employment, after which they may use paid sick days as they are accrued. Employers would also have the discretion to lend paid sick days to an employee in advance of accrual.

While accrued paid sick days would carry over to the following calendar year, employers could limit an employee’s use of paid sick leave to 24 hours, or three days, in each calendar year. Employers would not be required to compensate employees for unused sick days upon employment ending, but they would be required to reinstate the previously unused balance if they rehired the employee within one year.

Employees would be entitled to use paid sick time for preventive care for themselves or a family member, as well as for the diagnosis, care, or treatment of their or their family member’s existing health condition. For purposes of this bill, “family member” means (1) a child (as defined), (2) parent (as defined), (3) spouse, (4) registered domestic partner, (5) grandparent, (6) grandchild, or (7) sibling. The employer shall also provide paid sick days for an employee who is a victim of domestic violence, sexual assault, or stalking, as discussed in Labor Code sections 230 and 230.1.

The bill states it is not intended to preclude employers from implementing more generous policies. Also, an employer would not be required to provide additional sick pay under this bill if the employer already has a paid leave or paid time off policy that permits accrual at at least the same rate, and the accrued time is to be used for the same purposes and under the same conditions as in this bill.

Like many other recent Labor Code amendments, this bill also contains carve-outs for employees covered by collective bargaining agreements (CBAs) with certain provisions. Specifically, this bill would not apply to employees covered by CBAs that expressly provide for the wages, hours of work, and working conditions of employees, as well as for paid sick days (with final and binding arbitration for any disputes regarding paid sick days), premium wage rates for all overtime, and a regular hourly rate of not less than 30 percent more than the state minimum wage.

Similarly, construction industry employees covered by a CBA with these provisions would also not be covered by this bill if the CBA was entered into before Jan. 1, 2015, or if the CBA expressly waives the requirements of “this article” in clear and unambiguous terms.

This bill would also prohibit discrimination or retaliation against employees for using sick days, or for filing a complaint regarding any sick day policy violation. However, similar to last year’s protections against “immigration-related practices” (AB 263), this bill would create a rebuttable presumption of unlawful retaliation if an employer takes an adverse employment action (including denying the right to use sick days) within 30 days of an employee (1) filing a complaint with the Labor Commissioner or in court alleging violations of this article; (2) cooperating with an investigation or prosecution of an alleged violation of this article; or (3) opposing a policy, practice or act that is prohibited by this article. (A proposed 90-day presumption was reduced to the current 30-day presumption in a recent amendment).

Under Labor Code section 248.5, the Labor Commissioner would be entitled to enforce this article by awarding reinstatement, back pay, and payment of sick days unlawfully withheld, plus the payment of an additional (currently unspecified) sum in the form of an administrative penalty to an employee whose rights were violated. Where paid sick leave was unlawfully withheld, the employee shall recover the greater of $250 or the dollar value of the paid sick days withheld, multiplied by three. To encourage such reporting, the Labor Commissioner would be permitted to keep the reporting employee’s identifying information confidential.

The Labor Commissioner or the Attorney General would be able to file a civil action in court against the employer or any person violating this article. (A provision that would have authorized employees to file civil actions was deleted by recent amendment). The Labor Commissioner or Attorney General would be entitled to appropriate legal and equitable relief, including reinstatement, back pay, the payment of sick days improperly withheld, and liquidated damages of $50 to each employee for each violation each day, plus reasonable attorneys’ fees and costs.

New Labor Code section 247 would also require the employer to provide employees written notice of these paid sick leave rights in English, Spanish, Chinese, Tagalog, Vietnamese, and Korean, as well as any other language spoken by at least 5 percent of its employees. An employer will also be required to display a poster (which the Labor Commissioner will create) in a conspicuous place notifying employees of these paid sick leave rights. Employers who willfully violate the notice and posting requirements will be subject to a civil penalty of not more than $100 per offense.

New Labor Code section 247.5 would also require employers to retain, for at least five years, records documenting the hours worked, paid sick days accrued, and paid sick days used by each employee. These records may be inspected by the Labor Commissioner or by an employee, and if an employer fails to maintain adequate records, it shall be presumed that the employee is entitled to the maximum number of hours accruable under this new article, unless the employer proves otherwise by clear and convincing evidence.

Lastly, this bill would amend Labor Code section 226 to require employers to include on the itemized wage statements accompanying paychecks, the “paid sick leave accrued and used” during each pay period.

This bill is very similar to bills that have repeatedly been introduced but stalled, although this version is less far-reaching as it only requires three days of sick leave per year rather than up to nine days of annual sick leave.

Michael Kalt, an attorney at Wilson Turner Kosmo in San Diego, serves as the government affairs director for CalSHRM, the California State Council of the Society for Human Resource Management.

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