By Daniel Richardson

Beginning July 1, 2015, nearly all California employers will be required to provide full-time and part-time employees with a minimum of three days of paid sick leave per year.
The Healthy Workplaces, Healthy Families Act of 2014, signed into law by Governor Brown on September 10th, makes California the second state (the other is Connecticut) to require certain employers to provide employees with paid sick leave. In addition, the new law mandates notice and record-keeping obligations on employers. California employers should become familiar with the law’s requirements before it goes into effect next July to avoid administrative fines and other civil penalties. This article will provide an overview of some of the new law’s requirements.

Employers and Employees Covered by the New Law
The new law applies to nearly all California employees regardless of the size of the employer. There are, however, some carve-outs in the law for employees covered by collective bargaining agreements. For instance, an employee covered by a valid collective bargaining agreement is not subject to the new law if the agreement expressly provides for the wages, hours of work, working conditions, paid sick days, arbitration of disputes concerning the use of sick days, premium wage rates for all overtime hours worked, and a regular hourly rate of pay of not less than 30 percent more than the state minimum wage rate. Construction employees covered by a collective bargaining agreements with the same provisions are also exempt from the law if the collective bargaining agreement was entered into before January 1, 2015 or expressly waives the new law in clear and unambiguous terms.

Additionally, the law also exempts providers of in-home supportive services and certain individuals employed by an air carrier as a flight deck or cabin crew member.

Permitted Usage of Paid Sick Days

Sick days may be used for diagnosis, care, or treatment of an existing health condition, or preventive health care. In addition to the employee, sick days under this law may also be used to care for a spouse, child, parent, domestic partner, grandparent, grandchild, or sibling. In addition, paid sick days may be used by an employee who is a victim of domestic violence, sexual assault, or stalking.
An employer must provide the covered employee with the paid sick time off upon the oral or written request from the employee. It is up to the employee to determine the amount of paid sick leave that is required, however, the employer may establish minimum increments for the sick leave of at least two hours. The employee is required to give “reasonable” advance notice of the sick leave to his employer if the reason for the sick leave is foreseeable.

Calculating Accrued Sick Leave
Employers are required to provide employees covered by the new law with at least 24 hours or three days of sick leave each employment year. Covered employees will begin accruing sick leave after July 1, 2015 at a rate of at least one hour for every 30 hours worked. To use accrued sick leave, employees must have been employed for at least 90 days. Accrued sick leave is carried over to the next year, however, the law allows employers to cap the total amount of six leave at 48 hours or six days. Employers are not required to carry-over sick leave to the next employment year if the employee is given the full three days of sick leave at the beginning of each employment year. In addition, if an employee leaves the company and is then rehired by the same employer within one year, the employer must reinstate the employee’s accrued sick leave.
Pay for sick leave is based on the employee’s hourly wage. If the employee has been paid at different hourly rates, was a nonexempt salaried employee, or received a commission or piece rate, the rate of pay for sick leave is determined by taking the employee’s non-overtime wages for the previous 90 days and dividing it by the total number of hours worked. Employees are not entitled to a payout of accrued sick leave at the time of termination.
For employers that already have a paid sick leave policy in place, the law does not require additional sick leave to be provided to employees if the sick leave policy already in place satisfies the minimum requirements of the law.

Notice and Record Keeping Requirements
The new law amends the current Labor Code to require an employer to provide a newly hired employee written notice of the employee’s right to accrue and use sick leave without retaliation from the employer. In addition, the employer must display a poster in a conspicuous place that states the employees’ rights under the new law. The Labor Commissioner is required to make available to employers templates for the written notice and the poster. All employers, including employers who have existing sick leave policies in place that meet or exceed the law’s requirements, are still required to provide new employees with written notice of their rights under the law and display the poster.
Employers are also be required to maintain records for each employee of the hours worked and the paid sick days accrued and used over a three year period.

Enforcement and Penalties
Violations of the new law are enforced by the California Labor Commissioner. If the Labor Commissioner determines that a violation occurred, the Labor Commissioner may order reinstatement, back pay, payment for sick days withheld, and additional administrative penalties. Violations of the law could result in the following actions:

• For sick days that are unlawfully withheld from an employee, the employee is entitled to the dollar amount of the paid sick days withheld from the employee multiplied by three or $250, whichever is greater, up to $4,000.
• If there is additional harm to the employee, such as termination, the employer may be subject to an additional penalty of $50 per day for each day the violation occurred up to an aggregate amount of $4,000.
• Employers who willfully violate the notice or posting requirements of the new law may be subject to a fine of up to $100 per offense.
• If the Labor Commissioner determines that the employer was not forthcoming during the investigation, a civil action may be filed by the Labor Commissioner against the employer that could result in an additional penalty of $50 for each day a violation of the law occurred for each employee whose rights were violated.
• The law also authorizes either the Labor Commissioner or Attorney General to bring a civil action against an employer or person violating this law. The Labor Commissioner or Attorney General may seek legal and equitable relief including reinstatement of the employee, up to $4,000 for sick days unlawfully withheld, liquidated damages in the amount of $50 to each employee for each day the employee’s paid sick leave rights were violated times a multiple of three, as well as attorney’s fees and costs.

Conclusion
This article only gives an overview of the provisions of California’s new paid sick leave law. To avoid fines and penalties under the new law, it is essential that California employers update their employee sick leave policies and employee handbooks. It is also important to note that the new law does not preempt paid sick leave laws enacted by municipalities, such as the one in San Francisco, if they meet the minimum requirements of the new state law. A competent employment law attorney can help ensure that your business is in compliance with California’s new paid sick leave law.

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