LawFlash

California’s New Sick Leave Law Provides Supplemental Coverage for Employees Affected by COVID-19

September 21, 2020

California Governor Gavin Newsom signed into law Assembly Bill 1867 on September 9, requiring private employers with 500 or more employees nationwide to provide California employees with paid sick leave for coronavirus (COVID-19)-related absences. It also includes coverage for public and private employers of first responders and healthcare employees who did not provide leave under federal law, and other employees who might fall within the healthcare provider/emergency responder exemptions of the Families First Coronavirus Response Act (FFCRA) and other local supplemental paid sick leave laws.

The law also codifies Governor Newsom’s Executive Order N-51-20 issued on April 16, 2020, creating new Cal. Lab. Code 248, that provided paid sick leave and handwashing requirements for food sector workers, creates a small business family leave mediation pilot program, and amends enforcement provisions in California’s pre-COVID-19 paid sick leave law.

Effective Date

AB 1867, a budget trailer bill, is effective immediately, and intended to close the gaps in paid sick leave provided by federal law and the governor’s executive order. Employers, outside the food sector are required to provide COVID-19 supplemental paid sick leave (CSPSL) as of September 19, 2020 under new Cal. Lab. Code 248.1. For food sector workers, the leave requirement is retroactive to April 16, 2020 as provided under Executive Order N-51-20. The CSPSL provisions expire on December 31, 2020 or the expiration of the FFCRA (including any extension); whichever is later.

Covered Employers and Employees

The new law, under Cal. Lab. Code 248.1, applies to private employers with 500 or more employees in the United States doing business in California. It also applies to public and private employers that elected to exclude employees from emergency paid sick leave coverage under the FFCRA based on the healthcare provider or emergency responder exemptions.

A covered employee is one who works for a covered employer and leaves his or her home or residence to perform work for the employer. This includes healthcare providers or emergency responders who had been excluded from emergency paid sick leave under the FFCRA, and food sector workers. As noted above, food sector workers are covered under Cal. Lab. Code 248.

Reasons for Leave

The law allows employees to use CSPSL for three specific reasons:

  • The employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
  • The employee is advised by a healthcare provider to self-quarantine or self-isolate due to concerns related to COVID-19; or
  • The employee is prohibited from working by the employer due to health concerns related to the potential transmission of COVID-19.

Unlike the FFCRA and many California local emergency public health paid sick leave ordinances, AB 1867 does not provide leave for employees to care for others, such as children whose schools closed for COVID-19–related reasons.

How Much Leave Is Available to Employees?

The total hours available to an employee for CSPSL depends on the employee’s regular work hours.

  • Full-time employees, those considered full-time by the employer, or who worked or were scheduled to work, on average, at least 40 hours per week in the two weeks preceding the date the employee takes CSPSL, are entitled to 80 hours of CSPSL
  • Employees with a fixed weekly schedule are entitled to the total number of hours normally scheduled over two weeks.
  • Employees on a variable schedule are entitled to 14 times the average number of hours worked each day in the six months preceding the date the employee takes CSPSL. If the employee has worked for the employer for less than six months, the total length of their employment is used, unless the employee has been employed for 14 days or less. In that case, the total number of hours worked is used.

Compensation for COVID-19 Supplemental Paid Sick Leave

Employees using CSPSL leave must be paid an hourly rate equal to the highest of:

  • their regular rate of pay for the last pay period, including amounts any applicable collective bargaining agreement (CBA);
  • the state minimum wage; or
  • the local minimum wage.

Pay for CSPSL is capped at $511 per day or $5,110 in the aggregate. Payment of CSPSL must be made no later than the payday for the next regular payroll period after the leave was taken.

Interaction with Other Leaves

CSPSL under AB 1867 is in addition to any “regular” paid sick leave required under the California paid sick leave law, Cal. Lab. Code §246. However, an employer cannot require employees to use any other paid/unpaid leave, paid time off, or vacation before using, or in lieu of using, CSPSL.

Employers who provide supplemental paid sick leave hours for the reasons related to AB 1867’s covered reasons listed above, may count those hours towards the required amount of CSPSL hours under the new law. But, the compensation for those hours must be equal to, or greater than the compensation the employee would have received under AB 1867. This includes supplemental paid sick leave provided pursuant to federal or local laws (such as the FFCRA or local COVID-19 supplemental paid sick leave ordinances). If the employer provided supplemental paid leave between March 4, 2020 and September 9, 2020 at a rate lower than required under AB 1867, the employer may retroactively provide supplemental pay sufficient to make up the difference, so that those prior supplemental paid leave hours will be considered compliant with AB 1867 and can be offset against CSPSL.

Likely No CBA Exemption

Unlike the California paid sick leave law and some local COVID-19 paid sick leave ordinances, AB 1867 does not specifically contain a CBA exemption.

Notice and Wage Statement Requirements

Employers covered by Cal. Lab. Code 248.1 must post this poster drafted by the Labor Commissioner. If there are any employees who do not frequent the workplace, the notice requirement can be satisfied by disseminating the notice electronically. Employers must also provide notice of the amount of CSPSL available each pay period either on the employee’s wage statement or a separate writing, as required by Cal. Lab. Code §246(i). This notice requirement goes into effect the first full pay period following September 9, 2020.

For food sector workers, Cal. Lab. Code 248 incorporates the pre-COVID-19 statewide sick leave law posting requirements.

Enforcement

The Labor Commissioner is expressly authorized to enforce the requirements of AB 1867, including investigations, citations, and ordering temporary relief to mitigate violations. If the Labor Commissioner finds the COVID-19 supplemental sick leave pay was unlawfully withheld, the employer may face administrative penalties of at least $250 a day up to $4,000 in the aggregate. The Labor Commissioner or Attorney General may bring a civil action for legal and equitable relief, including reinstatement, back pay, the payment of sick days unlawfully withheld, and liquidated damages.

Return to Work Resources

We have developed many customizable resources to support employers’ efforts in safely returning to work. These include tracking of state and local orders on return to work requirements and essential/nonessential work; policy templates and guidelines for key topics such as social distancing procedures, temperature testing, and workplace arrangements for high-risk employees; and webinar training on safety measures for return to work. View the full list of return to work resources and consult our workplace reopening checklist.

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Contacts

If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:

Century City
Harry I. Johnson, III

Los Angeles
Jacqueline C. Aguilera
Kathryn T. McGuigan

Orange County
Barbara J. Miller

Silicon Valley
Alicia J. Farquhar
Michael D. Schlemmer