California Increases Paid Sick Leave Entitlements

October 11, 2023

Governor Gavin Newsom recently signed SB 616, which amends California’s Healthy Workplaces, Healthy Families Act of 2014 by increasing the amount of paid sick leave employers must provide to eligible California employees.

Effective January 1, 2024, employers must comply with the increased paid sick leave entitlements as well as changes to usage restrictions. The amended statute also requires that employers comply with new timing requirements for issuing paid sick leave when using an alternative accrual method.

Certain employees covered under a valid collective bargaining agreement, previously exempted from the paid sick leave statute, are now entitled to use employer-provided leave for qualifying paid sick leave reasons under Labor Code Section 246.5 and are eligible for the protections provided therein.

KEY TAKEAWAYS

Topic	Existing	Effective Jan. 1, 2024
Frontloading at beginning of each year of employment, calendar year, or 12-month period	24 hours or 3 days	40 hours or 5 days
Continuous accrual cap (Note: Once employees use time to fall below the accrual cap, employees will start accruing again up to the cap)	48 hours or 6 days	80 hours or 10 days
Alternative accrual method timing	Regular Basis Accrual: 24 hours by the 120^th day of employment, calendar year, or 12-month period Non-regular Basis Accrual: 24 hours or 3 days by the 120^th day of employment	Regular Basis Accrual: 24 hours by the 120^th day of employment, calendar year, or 12-month period and 40 hours by the 200^th day of employment, calendar year, or 12-month period Non-regular Basis Accrual: 24 hours or 3 days by the 120^th day and 40 hours or 5 days by the 200^th day of employment
Use caps each year of employment, calendar year, or 12-month period	24 hours or 3 days	40 hours or 5 days
Non-construction unionized employees	Excluded from current paid sick leave law so long as the collective bargaining agreement (CBA) expressly provided for (1) certain wage and hour provisions, (2) final and binding arbitration of paid sick day disputes, (3) regular hourly rate or pay of at least 30% more than the state minimum wage, and (4) paid sick leave or other paid time off that could be used for paid sick leave reasons.	Partially excluded from amended paid sick leave law. Non-construction unionized employees will be entitled to the benefits under Labor Code 246.5, which means they are now entitled to (1) use CBA-provided leave intended for sick leave use for specific qualifying reasons, (2) not be required to find a replacement to take sick leave, and (3) be free from discrimination or retaliation for using such leave or engaging in other protected activity.
Employees covered by the Federal Railroad Unemployment Insurance Act (RUIA)	Covered under current paid sick leave law	Not covered under amended paid sick leave law. This change reflects the outcome of the Ninth Circuit’s decision in National Railroad Passenger Corp. v. Su (2022), which held that the RUIA preempted California law.

WHAT HAS NOT CHANGED

Much of the law has not changed, including the following:

There is no requirement to cash out unused paid sick leave upon termination of employment.
Employers must reinstate unused paid sick leave to employees rehired within one year of separation unless paid sick leave was cashed out.
An employer may advance paid sick days that have yet to be earned at the employer’s discretion.
The amount of paid sick leave available must be listed on an itemized paystub or in a separate writing provided every payday.
Employees must provide reasonable advance notification for foreseeable paid sick leave.If the need for paid sick leave is unforeseeable, the employee must provide notice of the need for leave as soon as practicable.
The calculations for paying paid sick leave are unchanged.
Paid sick leave must be paid on the payday for the next regular payroll period after the sick leave was taken.

The amended paid sick leave law also expressly preempts any local ordinance inconsistent with the provisions included in the above list.

Additionally, employers that provide paid time off to employees in lieu of paid sick leave continue to be required to provide paid time off that meets or exceeds the requirements of the paid sick leave law to covered employees.

Next Steps

Employers should review their current paid sick time policies or paid time off policies to ensure that starting January 1, 2024, eligible California employees are receiving sufficient paid sick time in compliance with the new accrual requirements. Employers with non-construction employees covered under a CBA should also ensure that such employees are able to use their available paid sick time for the reasons set forth under Section 246.5.

Employers will also want to review their attendance and disciplinary policies to account for the protections now extended to unionized employees in the use of their paid sick leave for qualifying reasons under Section 246.5.

Contacts

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

Jacqueline C. Aguilera (Los Angeles)

M. Nicole Beckley (Seattle / San Francisco)

Claire M. Lesikar (Seattle / Silicon Valley)

Michael D. Schlemmer

Alicia J. Farquhar