California’s New COVID-19 Supplemental Paid Sick Leave

This blog provides an overview of a specific developing situation. It is not intended to be, and should not be construed as, legal advice for any particular fact situation.

On March 19, 2021, California Governor Gavin Newsom signed Senate Bill (SB) 95, which extends and expands employer requirements to provide supplemental paid sick leave (SPSL) to employees impacted by COVID-19. SB 95 goes into effect on March 29, 2021, (i.e., 10 days after being signed by Gov. Newsom) and adds sections 248.2 and 248.3 to the California Labor Code.

Previous Law

Last September, the California legislature passed AB 1867 to, among other things, codify Gov. Newsom’s Executive Order N-51-20 (signed April 16, 2020), which provided supplemental paid sick leave to food sector employees for an employer with 500 or more employees nationwide as a result of the COVID-19 pandemic.

However, AB 1867 expired on December 31, 2020 — with no action or clarification until now on whether the requirements would continue or be modified.

Are More Employers Covered?

Yes. The new law applies to many more California employers, now applying to public and private employers with more than 25 employees as defined by Labor Code section 245.5.

Are More Employees Covered?

Yes. In addition to more employees being covered by the nature of more employers being covered, SPSL is now expanded to employees who are “unable to work or telework” due to one of the qualifying reasons discussed below — as opposed to the previously more limited language.

Are There New Qualifying Reasons for Leave?

Yes. There are seven qualifying reasons for SPSL under SB 95:

As with AB 1867, an employee is entitled to SPSL if:

1. The employee is subject to a quarantine or isolation period related to COVID-19 (as defined by an order or guidelines by the California Department of Public Health, the CDC or local public health authorities). Should an employee be subject to more than one quarantine or isolation period, the employee shall be permitted to use the SPSL under the order or guidelines that provides for the longest minimum period); or
2. The employee is advised by a health care provider to self-quarantine or isolate due to concerns related to COVID-19.

SB 95 expands qualifying reasons with the following five additional reasons, some of which address COVID-19 vaccines:

1. The employee is attending an appointment to receive a vaccine for protection against contracting COVID-19;
2. The employee is experiencing symptoms related to a COVID-19 vaccine that prevent the employee from being able to work or telework;
3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
4. The employee is caring for a family member (as defined under Labor Code section 245.5(c), including a child (regardless of age or dependency status), parent or stepparent, spouse, registered domestic partner, grandparent, grandchild, or sibling) who is subject to a quarantine or isolation period, or who has been advised to self-quarantine; or
5. The employee is caring for a child (as defined under Labor Code section 245.5(c)) whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.

For How Much Leave Are Employees Eligible?

Employers who previously complied with AB 1867 and provided SPSL in 2020 are required to provide an additional “bank” of leave for employees in 2021.

As with AB 1867, employers must provide 80 hours of SPSL to a full-time employee or an employee who worked or was scheduled to work, on average, at least 40 hours per week in the two weeks preceding the date employee took SPSL.

Part-time employees are entitled to SPSL as follows:

• If the employee has a normal weekly schedule: the total number of hours the employee is normally scheduled to work for the employer over a period of two weeks.
• If the employee works a variable number of hours: 14 times the average number of hours the employee worked each day for the employer in the six months preceding the date the employee took SPSL. If the employee has worked for the employer over a period of fewer than six months but more than 14 days, SB 95 requires that this calculation be instead made over the entire period the employee has worked for the employer.
• If the employee works a variable number of hours and has worked for the employer over a period of 14 days or fewer: the total number of hours the employee has worked for that employer.

Is the Calculation of the Hourly Rate Different?

Yes. The rate of pay for this new SPSL differs from AB 1867.

For exempt employees, an employer must calculate the rate of pay in the same manner as the employer calculates wages for other forms of paid leave time.

Non-exempt employees are entitled to the highest of the following:

• Calculated in the same manner as the regular rate of pay for the workweek in which the employee uses SPSL, whether or not the employee actually works overtime in that workweek;
• Calculated by dividing 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;
• The California minimum wage (which is currently $14.00/hour for employers with 26 employees or more); or
• The local minimum wage to which the employee is entitled.

The amount of SPSL is capped at $511 per day and $5,110 total per employee unless these amounts are increased by the federal Emergency Paid Sick Leave Act established by the federal Families First Coronavirus Response Act (commonly referred to as the FFCRA).

Is There a Notice Requirement?

Yes. Employers must post a notice of the new requirements in a conspicuous place in the workplace, or disseminate by electronic means if the employees do not frequent a workplace.

Are There Itemized Wage Statement Requirements?

Like AB 1867, SPSL under SB 95 must be reflected on itemized wage statements (or other written notice) as required by Labor Code section 246(i) in addition to any regular paid sick leave the employee is entitled to under the California Healthy Workplaces, Healthy Families Act of 2014. In addition, for part-time employees or those with variable schedules, SB 95 allows employers to satisfy the itemized wage statement requirements (or other written notice) by doing an initial calculation of SPSL available and indicating “(variable)” next to that calculation. The actual amount of SPSL will then need to be updated on the itemized wage statements (or other written notice) when such employee requests to use SPSL or requests relevant records. The wage statement requirement becomes enforceable on the next full pay period after March 29, 2021.

How Does SB 95’s Retroactivity Work?

SB 95 applies retroactively to January 1, 2021.

First, if an employer continued to provide SPSL or Families First Coronavirus Response Act (“FFCRA”) leave on or after January 1, 2021, consistent with the new requirements of SB 95, then those hours may count towards the SPSL obligation. Generally, if leave is taken under the FFCRA, the employer may receive a federal tax credit. However, there are exceptions! (Check with counsel!)

Second, if an employer did not provide paid leave to an employee eligible for SPSL or did not compensate the employee in an amount equal to or greater than the amount of compensation for SPSL to which the employee is entitled to under SB 95, then “upon the oral or written request of the employee,” the employer must provide the employee with a retroactive payment that provides for such compensation from January 1, 2021.

Third, for any such retroactive payment, the number of hours of leave corresponding to the amount of the retroactive payment shall count towards the total number of hours of SPSL that the employer is required to provide to the employee under SB 95.

Finally, this retroactive payment shall be paid on or before the payday for the next full pay period after the employee’s oral or written request, and the itemized wage statement must reflect this retroactive payment.

Can This Leave Run Concurrent With, or in Lieu of, Other Leaves?

Generally, no. This bill prohibits an employer from requiring an employee to use other paid or unpaid leave, paid time off or vacation time provided by the employer to the employee before that employee uses SPSL or in lieu of SPSL.

Can an Employer Satisfy Cal/OSHA’s “Exclusion Pay” Requirements by Requiring an Employee to First Exhaust SPSL?

Yes. In order to satisfy Cal/OSHA’s exclusion pay requirements (i.e., when an employee is excluded from the workplace due to COVID-19 exposure as set forth in Cal/OSHA’s Emergency Temporary Standards effective November 30, 2020), an employer can require an employee to first exhaust the SPSL before the employer is required to pay exclusion pay under Cal/OSHA’s Emergency Temporary Standards.

Is This Law Permanent?

No. SB 95 is set to expire on September 30, 2021. That said, as with AB 1867, an employee who is on SPSL at the time of the expiration of this new law must be permitted to take the full amount of SPSL the employee would have otherwise been entitled to.

For More Information

Garcia & Gurney, ALC will continue to monitor and report on developments with respect to the COVID-19 pandemic and will post updates in the firm’s blog as additional information becomes available. If you have any specific questions, feel free to contact us.