On Wednesday evening, Governor Newsom signed a budget trailer bill (AB 1867) providing paid sick leave for full-time and part-time employees to take time off work when ill or caring for a family member due to COVID-19. The federal law exempted employers with 500 or more employees, but AB 1867 has closed that exemption by including employers with over 500 employees and public and private employers of first responders and health care employees who opted not to cover their employees under federal law.
The requirement to provide COVID-19 supplemental paid sick leave shall expire on December 31, 2020, or upon the expiration of any federal extension of the Emergency Paid Sick Leave Act established by the federal FFCRA, whichever is later. AGC is working with our National chapter to gather any insight or information existing on to the expectations of the Federal Act and any potential extensions.
To read the full statute that was added to Section 248.1 of the Labor Code, click here. You can also view the Governor’s press release about the legislation here and FAQs related to the added statute, below. If you have any additional questions, contact Kate Mergen at email@example.com. Additional details and clarifications will be distributed as they are obtained.
1. When does this law take effect?
The statute states that the requirement to provide COVID-19 supplemental paid sick leave as set forth in this section shall take effect not later than 10 days after the date of enactment. The enactment date was Wednesday, September 9, 2020. While the law is effective immediately, companies must comply no later than Saturday, September 19, 2020.
2. Who is required to pay “COVID-19 supplemental paid sick leave”?
All hiring entities (employers) within the State of California who have 500 employees or more at the time a claim is submitted. This includes all employees who are located outside of the State of California. The calculation rate is the same as the Federal Families First Coronavirus Response Act which is mandated by Section 826.40(a)(1) and (2) of Title 29 of the Code of Federal Regulations.
*AGC of California is seeking further clarification on the Joint Employer Status and how that will impact employee counts. More information will be provided as a follow up.
3. What if a hiring entity already provides paid sick leave?
Paid sick leave already provided by a hiring entity pursuant to state and city normal paid sick leave laws may NOT be counted toward an employer’s obligation to provide COVID-19 supplemental paid sick leave.
4. What is the criteria in order for a worker/employee to be covered?
A covered worker is a person who is employed by a hiring entity and leaves their home or other place of residence to perform work for their hiring entity who has been previously excluded from the FFCRA (Families First Coronavirus Response Act).
5. What criteria triggers the supplemental paid sick leave by the hiring entity?
A hiring entity shall provide the supplemental paid sick leave to each covered worker who performs work for the hiring entity if that covered worker is unable to work due to any of the following reasons:
A- The covered worker is subject to a federal, state, or local quarantine or isolation order related to COVID-19. (ex. The county in which work is being performed issues Public Health Orders that mandates isolation or quarantine.)
B- The covered worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19. (ex. Your Safety Coordinator tests positive for COVID-19 and is advised by a medical professional to not return to work until 72 hours after being symptom free.)
C- The covered worker is prohibited from working by the covered worker’s hiring entity due to health concerns related to the potential transmission of COVID-19. (ex. If you have one worker in a crew test positive and through contact tracing the hiring entity identifies 4 other individuals who came in contact with that worker and ask them to self-quarantine. Those 4 individuals would be entitled to the supplemental pay while off work.)
6. What is the rate of the supplemental pay?
A hiring entity shall not be required to pay more than five hundred and eleven dollars ($511) per day and five thousand one hundred and ten dollars ($5,110) in the aggregate to a covered worker for COVID-19 supplemental paid sick leave taken by the worker.
Hiring entities should issue payment at the regular rate of pay. The compensation rate should equal to the highest of the following (subject to the caps listed above):
(i) The employee’s regular rate of pay for the last pay period, including pursuant to any collective bargaining agreement that applies.
(ii) The state minimum wage.
(iii) The local minimum wage to which the employee is entitled.
*AGC is working to clarify payment requirements for signatory companies. Additional information will be distributed through the UCC as it is obtained.
7. How is the amount of time a covered worker is entitled to calculated?
If the covered worker worked or was scheduled to work, on average, at least 40 hours per week for the hiring entity in the two weeks preceding the date the covered worker took the leave, the covered worker is considered to be full-time and is entitled up to 80 hours of COVID-19 supplemental paid sick leave.
For Full-Time Staff - If the covered worker is not considered to be full-time, but the worker has a normal weekly schedule, the total number of hours the covered worker is normally scheduled to work for the hiring entity over two weeks will be what the covered worker is entitled to receive.
For Part-Time Staff (More than 6 months) - If the covered worker works a variable number of hours, the covered worker is entitled up to fourteen times the average number of hours they worked each day for the hiring entity in the six months preceding the date they took paid sick leave.
For Part-Time Staff (More than 14 days but less than 6 months) - If the covered worker has worked for the hiring entity for a period of more than 14 days but less than 6 months, this calculation shall instead be made over the entire period the employee has worked.
For Part-Time Staff (14 days or fewer) - If the covered worker works a variable number of hours and they have worked for the employer over a period of less than 14 days, the total number of hours the employee has worked for the employer.
8. What if there is a local ordinance in effect that mandates COVID-19 supplemental paid sick leave?
If a local ordinance is in effect that requires hiring entities with 500 employees or more to provide the COVID-19 supplemental paid sick leave, this will meet the requirements for the state. YOU ARE NOT REQUIRED TO PAY TWICE.
However, if the hiring entity was providing COVID-19 supplemental pay at a rate that does not meet the same requirements as the state mandated program, hiring entities will be responsible for making up the difference.
9. What if I am a signatory contractor and there is a Collective Bargaining Agreement Waiver in effect through the local ordinance?
AB 1867 was enacted to ensure that ALL covered workers are entitled to the COVID-19 supplemental paid sick leave. This means that even if there is a CBA waiver in effect through the local ordinance, all hiring entities would still be required by state law to provide the pay. No exemptions will apply.
10. Are there any requirements to post this information with our other Labor Law Posters/Information?
The law requires that the Labor Commissioner issue a template notice for hiring entities to distribute to their employees notifying them of the new law. This template notice will be distributed by AGC once the Labor Commissioner releases the document (which is mandated to be released no later than Wednesday, September 16, 2020.)
If a hiring entity’s workforce is not currently frequenting the workplace, a hiring entity may distribute the information electronically (via email) to satisfy the obligation to communicate the information.
11. Will there be any requirements for pay stubs due to this new law?
The bill itself does not contain any new pay stub requirements. However, it incorporates certain provisions of the existing California sick leave law, including its pay stub requirement (Labor Code 246(i)). Labor Code section 246(i) states that employers must provide employees with written notice of the amount of paid sick leave they have available on their itemized wage statement, or in a separate writing provided on the designated pay date with the payment of wages. This requirement also applies to supplemental COVID paid sick leave. The pay stub requirement is effective on the first full pay period following enactment of the new law.
12. The Federal Families First Coronavirus Response Act had reimbursement/tax incentives attached to the program. Does the state statute offer anything similar?
NO, hiring entities are not entitled for any reimbursement or tax incentives by offering the requirement COVID-19 Supplemental Paid Sick Leave.
13. When does this law remain in effect until?
The requirement to provide COVID-19 supplemental paid sick leave shall expire on December 31, 2020, or upon the expiration of any federal extension of the Emergency Paid Sick Leave Act established by the federal FFCRA, whichever is later.