The Healthy Workplaces, Healthy Families Act of 2014 (Act) requires most California employers, regardless of size, to provide paid sick leave benefits to any temporary, part-time, and full-time employee.

On October 4, 2023,Governor Newsom signed Senate Bill 616, which expands the amount of employer-provided paid sick leave benefits under the Act from 24 to 40 hours. Specifically:

• Advance method: Under current law, an employer may opt to reserve 24 hours or three days of paid sick leave benefit in an up-front lump sum for eligible employees to use during the 12-month eligibility year. Starting January 1, 2024, employers must reserve 40 hours or five days on an annual basis.

• Statutory accrual/carryover method: Under current law, an employer may instead opt for eligible employees to accrue paid sick leave over time, such as one hour for every 30 hours worked. An employer can limit annual usage to 24 hours or three days and cap the amount accrued at six days or 48 hours. Starting January 1, 2024, the accrual rate remains at one hour for every 30 hours worked but the employer must raise the annual usage limit to 40 hours or five days and the total accrual cap to 10 days or 80 hours.

• Optional accrual/carryover method: Under current law, an employer may use another regularly-recurring accrual method, such as per pay period, so long as employees accrue at least three days or 24 hours by the 120^th day of the 12-month eligibility period. An employer can limit the annual usage and total cap as with the above statutory accrual method. Starting January 1, 2024, the accrual rate must result in an employee earning at least 24 hours by the 120^th day of his/her eligibility year and no less than 40 hours by the 200^th calendar day, and the employer, as with the statutory accrual method, must raise the annual usage limit to 40 hours or five days and raise the total accrual cap to 10 days or 80 hours.

It remains to be seen whether any of the eight local sick pay ordinances will modify their mandatory sick pay thresholds in response to Senate Bill 616.

Employers must comply with the Act and all pertinent local laws, applying the provision or rule that confers greater rights to the employee.

Take-Aways:

Covered employers should promptly review their existing paid sick leave policies, payroll procedures, and absence request forms with competent legal counsel; assess any interplay with local laws; and notify and train relevant human resources and accounting staff on these changes.

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

See also:

• True Group; Workplace Policy Handbook & Forms for 2023 (September 28, 2023)
• Disability Leave Policy - Accommodation Dispensation (August 25, 2023)
• Inclusion, Expanded - California's Greater Reach on Family Leave and Paid Sick Benefits (December 9, 2022)

Cindy Bamforth
October 11, 2023