In a state known for setting trends, California’s latest move to require more paid sick leave is drawing considerable interest (and a certain amount of concern) from employers nationwide.
The California Healthy Workplaces, Healthy Families Act of 2014, generally referred to as the Sick Leave Law, went into effect just over a year ago, on July 1, 2015. Statewide, it provides at least three days (24 hours) annual sick leave for most employees. Accrual caps cannot be less than six days (48 hours).
President Barack Obama issued a related Executive Order that goes into effect as of 2017. As of that date, federal contractors and sub-contractors to provide a minimum of seven days paid sick leave per year to their employees.
But it gets more complicated.
What has employers concerned most is the fact that individual cities are taking it one step further — enacting their own, more stringent, sick leave rules. And the number of cities doing this is growing. Let’s look at some examples from around the state.
- Not waiting for state action, San Francisco started requiring paid sick leave back in 2007, for workers on the job at least 90 days:
- Accrual rate is 1 hour for every 30 hours worked.
- For employers with more than 10 workers, accrual caps at 72 hours.
- Most employees must receive at least six days (48 hours) sick leave per year.
- Employees may make the entire amount available immediately, or dole it out via the state-mandated rate, up to the cap.
- Employees can accrue up to 72 hours of sick leave, based on mandated accrual and carry-over procedures. The accrual rate matches the state law.
- As of 2017, businesses with no more than 25 employees can cap accrual at 32 hours; for larger businesses, the cap will be 40 hours, but that goes up to 72 hours in 2018.
- Employers may invoke a 90-day waiting period before employees can take their sick leave.
- Anyone who works at least two hours/week must be allowed to accrue sick leave at the state-mandated rate.
- Businesses with nine or fewer employees can cap accrual at 40 hours, but they still must comply with the state-mandated overall cap of 48 hours.
- Those with 10 or more employees can cap accrual at 72 hours.
- As in Santa Monica, employers may impose a 90-day waiting period.
- Companies with 55 or fewer employees can cap accrual at 48 hours. For larger businesses, it’s 72 hours.
- No employer can cap the number of paid sick days an employee uses in a year.
Most cities allow workers to use their paid sick leave to tend to family members. But it’s easy to see the problem, isn’t it? Without consistency, what’s an employer to do?
This trend has implications for every employer, and not just in California.
There are numerous practical concerns about implementation, especially for companies with workers in multiple cities. And California isn’t the only state helping to set this trend. Connecticut, Massachusetts, Oregon, Vermont, the District of Columbia and a number of individual cities in other states also have paid sick leave laws now. It’s such a patchwork that some states have embargoed local enactment of such rules. Nonetheless, if your company isn’t already affected, you probably will be.
Preparation is essential. Industry experts suggest you have some choices:
- Review your current sick leave policies and adjust them as necessary to match the “highest common denominator” among laws that affect your locations.
- Consider whether it’s feasible to adopt a single paid time off (PTO) policy for all your locations, or if you need separate PTO and sick leave policies.
- Implement appropriate policies, if you have none now.
And remember that your sick leave policy reflects on you as an employer. In an environment where competition for top job candidates can be truly fierce, your benefits package and “employee care” culture can tip the scales.