Our prior articles “Mandatory Paid Sick Leave For California Employees” and “Shall the Fog Be Forever Forsaken? California Labor Commissioner Again Attempts to Resolve Questions on New Paid Sick Leave Benefits Law” cover provisions of California’s new paid sick leave (PSL) Healthy Workplaces, Healthy Families Act (the Act), key portions of which went into effect July 1, 2015.

Confusion in the Act's language prompted proposed clean-up legislation (Assembly Bill [AB] 304) in February, 2015: "Proposed Amendments Aim to Modify the Healthy Workplaces, Healthy Families Act". After numerous revisions, Governor Brown has signed AB 304 into law, effective July 13, 2015. The changes, many of them fairly technical include:

1. Excluded Employees: Revised Labor Code 245.5(a) now excludes a “retired annuitant” of a government entity [a person receiving an annuity or pension] from PSL eligibility. That section also broadens the types of workers covered by construction industry collective bargaining agreements who can be excluded from receiving PSL benefits. Proposed AB 11, which would have extended PSL benefits to providers of “in-home supportive services,” did not pass. Thus, such caregiver employees continue to be excluded from the Act.

2. Eligible Employees Clarification: Under revised Labor Code 246(a), an employee who, on or after January 1, 2015, works in California for 30 or more days for the same employer within a year from the commencement of his or her employment becomes eligible for paid sick days.

3. Optional Accrual Methods: Originally the Act required an employer using an accrual method to provide a minimum of one hour of paid sick leave for every 30 hours actually worked. Revised Labor Code 246(b)) now allows an employer to implement a different accrual method provided that the accrual occurs regularly and the employee will have at least 24 hours of accrued sick leave or paid time off available by the 120th calendar day of employment or each calendar year or 12-month period.

4. Grandfathered Policies: Under revised Labor Code 246(e)(2), certain employer policies in existence prior to January 1, 2015, that have not yet been modified can be grandfathered so long as (i) they provide for regular accrual of paid sick leave (or “paid time off” [PTO]); (ii) the employee accrues at least one day or eight hours within three months of employment of each calendar year or 12-month period; and (iii) the employee was eligible to earn at least 24 hours/three days of paid sick leave/PTO within nine months of employment.

5. Reinstatement: Revised Labor Code 246(f) clarifies that the employer’s requirement to reinstate previously accrued and unused paid sick days for any employee rehired within one year from the separation date does not apply to employees who were paid out at the time of separation of employment.

6. Pay Stub Notification: Originally, the Act specified that all eligible employees must receive written notice of the amount of available paid sick leave or PTO on the employee’s pay stub or a separate writing provided with the employee’s payment of wages. Under revised Labor Code 246(h), an employer who provides unlimited sick leave to its employees (no maximum cap) may now meet this notice requirement by indicating “unlimited” [sick leave] on the employee’s itemized wage statement or in a separate writing provided on each designated pay date. Also, employers covered by Wage Orders 11 or 12 (broadcasting and motion picture industries) now have until January 21, 2016 to comply with the pay stub notification requirements.

7. Improved Hourly Rate Calculations: Revised Labor Code 246(k) now allows employers to select from several alternative calculations when determining how to pay PSL. For non-exempt employees, either (i) calculate pay in the same manner as the “regular rate of pay”* for the same workweek in which the employee uses paid sick time; or (ii) divide the employee’s total wages, not including overtime premium pay, by the employee’s total hours worked in the full pay periods of the prior 90 days of employment; and (iii) for exempt-from-overtime employees, calculate paid sick time in the same manner as the employer calculates wages for other forms of paid leave time.

* Regular rate of pay means the employee’s actual rate of pay, not just the straight hourly rate. It includes all hourly earnings plus compensation in the form of commissions, non-discretionary production bonuses, piece work compensation and the value of meals and lodging. To calculate the regular rate of pay divide the total of all such compensation by the total hours worked (including overtime hours) in the given pay period(s).

8. Record keeping Requirements: Although employers must maintain records for at least three years documenting the number of hours worked and paid sick days accrued and used, revised Labor Code 247.5(b) confirms an employer is not obligated to inquire into or record the purposes for which an employee uses PSL or PTO.

The Division of Labor Standards Enforcement (DLSE) is currently revising its Frequently-Asked Questions to address AB 304’s changes to the Act. We will continue to update the status of DLSE announcements and postings.

Employers should review their paid sick leave/PTO policies and workplace record keeping, timekeeping and payroll practices to ensure continued compliance with the modified Act.

For additional assistance understanding and implementing the Healthy Workplaces, Healthy Families Act, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Law Offices of Timothy Bowles
August 24, 2015

As described in our article “California Paid Sick Leave Law,” several portions of California’s Healthy Workplaces, Healthy Families Act (the Act) are just a shade clearer than mud.

In the latest attempts to clarify, the Division of Labor Standards Enforcement (DLSE) recently issued its first opinion letter addressing the Act and updated its frequently asked questions list.

The opinion letter resolves a question concerning the total annual PSL certain employees must receive. Under an accrual PSL policy, in which employees earn sick leave over time, with accrued time carrying over in each year of employment, the Act allows an employer to limit an employee’s use of paid sick days to 24 hours or three days in each year of employment. Under an up-front PSL policy the employer must provide at least 24 hours or three days of paid sick leave per year and the full amount of this leave must be available for the employee’s use at the beginning of the applicable 12-month period.

The question had arisen under both types of policies as to what is meant by “24 hours or three days” of PSL, particularly for part-time employees. For example, if a part-time employee works only four hours per shift, can that part-time worker lawfully receive only three days’ paid sick leave (i.e. 12 hours total) or must the worker receive 24 hours of paid sick leave (i.e. six days total)?

The opinion letter confirms the Division’s position that employers must provide an employee an annual allotment of up to three days or 24 hours of PSL, whichever is greater. According to the DLSE, as the Act regulates wages, hours and working conditions for employees’ protection and benefit, its provisions must be “liberally construed with an eye to promoting such protection.” “To limit a part-time worker who works four hour days to only 12 hours of paid sick leave, based on a ‘three day’ standard, disregards the statutory reference to a minimum of 24 hours and would defeat the legislative objective of providing low wage workers with at least a minimum of 24 hours of paid sick leave per year.” Thus, a part-time worker must receive up to 24 hours of PSL.

For additional assistance understanding and implementing the Healthy Workplaces, Healthy Families Act, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Law Offices of Timothy Bowles
August 24, 2015

Our prior articles “Mandatory Paid Sick Leave For California Employees” and “Shall the Fog Be Forever Forsaken? California Labor Commissioner Again Attempts to Resolve Questions on New Paid Sick Leave Benefits Law” cover provisions of California’s new paid sick leave (PSL) Healthy Workplaces, Healthy Families Act (the Act), key portions of which went into effect July 1, 2015.

Confusions in the Act’s language prompted proposed clean-up legislation (Assembly Bill [AB] 304) in February, 2015: “Proposed Amendments Aim to Modify the Healthy Workplaces, Healthy Families Act”. After numerous revisions, Governor Brown has signed AB 304 into law, effective July 13, 2015. The changes, many of them fairly technical, include:

1. Excluded Employees: Revised Labor Code 245.5(a) now excludes a “retired annuitant” of a government entity [a person receiving an annuity or pension] from PSL eligibility. That section also broadens the types of workers covered by construction industry collective bargaining agreements who can be excluded from receiving PSL benefits. Proposed AB 11, which would have extended PSL benefits to providers of “in-home supportive services,” did not pass. Thus, such caregiver employees continue to be excluded from the Act.

2. Eligible Employees Clarification: Under revised Labor Code 246(a), an employee who, on or after January 1, 2015, works in California for 30 or more days for the same employer within a year from the commencement of his or her employment becomes eligible for paid sick days.

3. Optional Accrual Methods: Originally the Act required an employer using an accrual method to provide a minimum of one hour of paid sick leave for every 30 hours actually worked. Revised Labor Code 246(b)) now allows an employer to implement a different accrual method provided that the accrual occurs regularly and the employee will have at least 24 hours of accrued sick leave or paid time off available by the 120th calendar day of employment or each calendar year or 12-month period.

4. Grandfathered Policies: Under revised Labor Code 246(e)(2), certain employer policies in existence prior to January 1, 2015, that have not yet been modified can be grandfathered so long as (i) they provide for regular accrual of paid sick leave (or “paid time off” [PTO]); (ii) the employee accrues at least one day or eight hours within three months of employment of each calendar year or 12-month period; and (iii) the employee was eligible to earn at least 24 hours/three days of paid sick leave/PTO within nine months of employment.

5. Reinstatement: Revised Labor Code 246(f) clarifies that the employer’s requirement to reinstate previously accrued and unused paid sick days for any employee rehired within one year from the separation date does not apply to employees who were paid out at the time of separation of employment.

6. Pay Stub Notification: Originally, the Act specified that all eligible employees must receive written notice of the amount of available paid sick leave or PTO on the employee’s pay stub or a separate writing provided with the employee’s payment of wages. Under revised Labor Code 246(h), an employer who provides unlimited sick leave to its employees (no maximum cap) may now meet this notice requirement by indicating “unlimited” [sick leave] on the employee’s itemized wage statement or in a separate writing provided on each designated pay date. Also, employers covered by Wage Orders 11 or 12 (broadcasting and motion picture industries) now have until January 21, 2016 to comply with the pay stub notification requirements.

7. Improved Hourly Rate Calculations: Revised Labor Code 246(k) now allows employers to select from several alternative calculations when determining how to pay PSL. For non-exempt employees, either (i) calculate pay in the same manner as the “regular rate of pay”* for the same workweek in which the employee uses paid sick time; or (ii) divide the employee’s total wages, not including overtime premium pay, by the employee’s total hours worked in the full pay periods of the prior 90 days of employment; and (iii) for exempt-from-overtime employees, calculate paid sick time in the same manner as the employer calculates wages for other forms of paid leave time.

* Regular rate of pay means the employee’s actual rate of pay, not just the straight hourly rate. It includes all hourly earnings plus compensation in the form of commissions, non-discretionary production bonuses, piece work compensation and the value of meals and lodging. To calculate the regular rate of pay divide the total of all such compensation by the total hours worked (including overtime hours) in the given pay period(s).

8. Record keeping Requirements: Although employers must maintain records for at least three years documenting the number of hours worked and paid sick days accrued and used, revised Labor Code 247.5(b) confirms an employer is not obligated to inquire into or record the purposes for which an employee uses PSL or PTO.

The Division of Labor Standards Enforcement (DLSE) is currently revising its Frequently-Asked Questions to address AB 304’s changes to the Act. We will continue to update the status of DLSE announcements and postings.
Employers should review their paid sick leave/PTO policies and workplace recordkeeping, timekeeping and payroll practices to ensure continued compliance with the modified Act.

For additional assistance understanding and implementing the Healthy Workplaces, Healthy Families Act, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth
August 6, 2015

Click here for our more recent article about 2018 California Minimum Wage Rates (updated Jan 4, 2018)

On July 21, 2015, the Los Angeles County Board of Supervisors voted 3-2 to increase the minimum wage in unincorporated portions of LA County. The enactment of this law follows on the heels of an identical move by the City of Los Angeles. Click here to see the LA County minimum wage schedule for 2016 to 2020.

The County-approved measure will gradually increase the minimum wage each July over five years in identical increments, starting at $10.50/hour on July 1, 2016, then $12.00 (2017), $13.25 (2018), $14.25 (2019), and $15.00 (2020). Following 2020, minimum wage will adjust according to the cost of living.

Consistent with the City of Los Angeles, compliance of businesses with under 26 on payroll will start a year later. For example, a small office employing 8 – 10 persons will begin its required increases with $10.50/hour minimum by July 1, 2017.

The City of Los Angeles ordinance applies only to businesses located within the incorporated city limits. A business that pays taxes to the City or is under City utilities is likely covered by the City’s ordinance.

The County ordinance will apply only to locations not within the boundaries of the City of Los Angeles or of any other incorporated city. Thus, the new law will not reach a business within Glendale, Pasadena, Santa Monica, Palmdale, Burbank, Lancaster, Long Beach, or any of the other 81 incorporated municipalities in the county with a local government, e.g., a mayor, city council and local ordinances. The Los Angeles County website provides a directory and a map of its incorporated cities.

For further information on the LA County minimum wage schedule, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Helena Kobrin, July 27, 2015

Click here for more data on the the LA County minimum wage schedule for 2016 to 2020.

Law Offices of Timothy Bowles
July 27, 2015

On July 21, 2015, the Los Angeles County Board of Supervisors voted 3-2 to increase the minimum wage in unincorporated portions of LA County. The enactment of this law follows on the heels of an identical move by the City of Los Angeles. See our blog, City of Los Angeles Minimum Wage Increasing Annually from 2016 to 2020.

The County-approved measure will gradually increase the minimum wage each July over five years in identical increments, starting at $10.50/hour on July 1, 2016, then $12.00 (2017), $13.25 (2018), $14.25 (2019), and $15.00 (2020). Following 2020, minimum wage will adjust according to the cost of living.

Consistent with the City of Los Angeles, compliance of businesses with under 26 on payroll will start a year later. For example, a small office employing 8 – 10 persons will begin its required increases with $10.50/hour minimum by July 1, 2017.

The City of Los Angeles ordinance applies only to businesses located within the incorporated city limits. A business that pays taxes to the City or is under City utilities is likely covered by the City’s ordinance.

The County ordinance will apply only to locations not within the boundaries of the City of Los Angeles or of any other incorporated city. Thus, the new law will not reach a business within Glendale, Pasadena, Santa Monica, Palmdale, Burbank, Lancaster, Long Beach, or any of the other 81 incorporated municipalities in the county with a local government, e.g., a mayor, city council and local ordinances. The Los Angeles County website provides a directory and a map of its incorporated cities.

For further information, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Law Offices of Timothy Bowles
July 27, 2015

Employees eligible for California’s Paid Family Leave (PFL) benefits may receive up to six weeks of state-funded partial wage replacement for leaves of absence to care for a seriously ill family member or to bond with a newborn child.

All California employers are required to provide a PFL pamphlet to all new hires as well as those qualifying employees taking time out from work for baby-bonding or care-giving.

The PFL pamphlet describes the PFL program, outlines employee eligibility criteria, and explains how to apply for benefits.

In May, 2015, the California Employment Development Department (EDD) recently issued two mandatory changes to the pamphlet, including a new government mailing address where employees should submit paid family leave claims and new government phone numbers, including a new number for the hearing impaired. Employers may download the pamphlet as a pdf or purchase it from the California Chamber of Commerce.

For further information, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Law Offices of Timothy Bowles
July 16, 2015

Employees eligible for California’s Paid Family Leave (PFL) benefits may receive up to six weeks of state-funded partial wage replacement for leaves of absence to care for a seriously ill family member or to bond with a newborn child.
All California employers are required to provide a PFL pamphlet to all new hires as well as those qualifying employees taking time out from work for baby-bonding or care-giving.

The PFL pamphlet describes the PFL program, outlines employee eligibility criteria, and explains how to apply for benefits.

In May, 2015, the California Employment Development Department (EDD) recently issued two mandatory changes to the pamphlet, including a new government mailing address where employees should submit paid family leave claims and new government phone numbers, including a new number for the hearing impaired. Employers may download the pamphlet as a pdf or purchase it from the California Chamber of Commerce.

For further information, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth
July 16, 2015

Private-sector employers with 50 or more employees are covered by the California Family Rights Act (CFRA) and the federal Family and Medical Leave Act (FMLA). These state and federal laws enable a qualified worker to take an unpaid health-related leave of absence – for example, for his/her or a family member’s serious health condition, child birth or newborn care — with assurance of return to his/her job position.

The California Fair Employment and Housing Council has updated the CFRA regulations, effective July 1, 2015. The amended regulations align more closely with FMLA regulations. The changes include updates to the definitions of “covered employer” and “eligible employee.” The definition of “spouse” now includes same-sex marriage partners. The reinstatement provisions are now expanded along with greater clarity on an employer’s permissible justifications for declining to reinstate.

Some of the differences remaining between the state and federal acts are:

• The CFRA regulations caution against prying into the nature of the medical condition (under CFRA, employers may only contact a health care provider to authenticate a medical certification). Under FMLA, employers may contact the provider to clarify as well as authenticate the certification.
• In contrast with FMLA, the CFRA regulations only permit second medical opinions where leave is for the employee’s own serious health condition.
• Pregnancy disability is only covered as a serious health condition under FMLA, not the CFRA. California has a separate set of laws and regulations governing pregnancy disability leave.

Covered employers must post the revised CRFA Notice B from July 1, 2015 on. That updated poster can be purchased through the California Chamber of Commerce.

Leave administrators of covered employers should re-visit their leave policies and practices to ensure compliance with the new amendments, including correct handling of leave requests, extensions, and reinstatement.

For further information, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth
July 10, 2015

Private-sector employers with 50 or more employees are covered by the California Family Rights Act (CFRA) and the federal Family and Medical Leave Act (FMLA). These state and federal laws enable a qualified worker to take an unpaid health-related leave of absence – for example, for his/her or a family member’s serious health condition, child birth or newborn care -- with assurance of return to his/her job position.

The California Fair Employment and Housing Council has updated the CFRA regulations, effective July 1, 2015. The amended regulations align more closely with FMLA regulations. The changes include updates to the definitions of “covered employer” and “eligible employee.” The definition of “spouse” now includes same-sex marriage partners. The reinstatement provisions are now expanded along with greater clarity on an employer’s permissible justifications for declining to reinstate.

Some of the differences remaining between the state and federal acts are:

• The CFRA regulations caution against prying into the nature of the medical condition (under CFRA, employers may only contact a health care provider to authenticate a medical certification). Under FMLA, employers may contact the provider to clarify as well as authenticate the certification.
• In contrast with FMLA, the CFRA regulations only permit second medical opinions where leave is for the employee’s own serious health condition.
• Pregnancy disability is only covered as a serious health condition under FMLA, not the CFRA. California has a separate set of laws and regulations governing pregnancy disability leave.

Covered employers must post the revised CRFA Notice B from July 1, 2015 on. That updated poster can be purchased through the California Chamber of Commerce.

Leave administrators of covered employers should re-visit their leave policies and practices to ensure compliance with the new amendments, including correct handling of leave requests, extensions, and reinstatement.

For further information, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Law Offices of Timothy Bowles
July 10, 2015