As you all should know, California amended its sick leave law effective January 1 of this year and increased the amount of annual days provided to employees from 3 to 5, and the number of hours from 24 to 40. Obviously, if you are in locales like Los Angeles or Santa Monica where the requirement is already high, this doesn’t appear to affect you as much. But there are a few things about the new state law that have caused some questions or that I thought I would at least point out to start.
First, if you are governed by the new state sick leave law, California Labor Code Section 2810.5 requires that you update your written policy on this and distribute it to your employees within 7 days of it becoming law. Well, clearly that date already came and went. Don’t panic; there are no Labor Commissioners standing on street corners waiting to issue you fines for this. However, you are required to update your sick leave policies, and it’s just another reminder to update your handbooks if you haven’t done that yet – which is why I keep that flyer that the top. And by the way, it is a PAGA violation not to give out the Labor Code 2810.5 form to all new employees upon hire, which includes information on your sick leave policy.
Next, the new sick leave law allows for some flexibility in accrual methods that has caused some confusion. It allows you to front load all of the 40 hours, which used to be 24 hours, or it allows you to accrue the sick time like before – one hour for every 30 hours worked. But it also permits different accrual methods, so long as the employee accrues at least 24 hours of sick leave by the 120th calendar day and 40 hours by the 200th calendar day. Some of you have called me panicking because you have very part time employees, and you say some of them won’t meet these latter thresholds. Do not fear. You can ALWAYS use the one hour in every 30-accrual method. The latter tests are ONLY if you use a different accrual method. It is an “either-or” test. I wanted to clarify that, as I got several questions along that line.
Finally, last little fun fact that was raised by one of you. The state sick leave law requires employers to provide 5 days or 40 hours of sick leave per year, whichever is greater. And when would 5 days of sick leave be greater than 40 hours? Well, when your employees work more than 8 hours a day, right?
This issue frankly never occurred to me, but of course, it occurred to one of my clients who has employees who regularly work more than 8 hours in a day, and she looked up on the state website, the FAQs in particular, and found an Opinion Letter back from 2015 on point. Now, there are a few problems with this Opinion Letter. First, Opinion Letters are only given so much weight, because they are not formal regulations, according to the California Supreme Court in Tidewater. Second, in this case in particular, the Letter is unclear and I’ll explain why. I cannot tell if this Opinion Letter was addressing an employee who was regularly scheduled to work 10 hours a day as part of an AWS (Alternative Work Schedule), that is, a schedule that is approved under the Labor Code where an employee works 10 REGULAR hours of work; or rather, as most of you would have, an employee who works 8 regular hours and 2 with OVERTIME. To me, there is a big difference, because if an employee is scheduled to work 8 hours of regular work and 2 hours of overtime, then I think the sick pay should actually be 11 hours of regular pay. Wouldn’t that make the most sense? And in fact, for the handful of you that I know DO pay out their PTO or sick or vacation pay to non-exempt employees who regularly work 10 hour days including overtime, I think most of you DO pay it as 11 hours of sick pay. But this Opinion Letter did not address the issue of overtime at all.
In any case, the Letter concludes back in 2015 that those employees would get 3 – 10-hour days under the former state law. And now, those employees would get 5 – 10-hour days, or 50 hours under the new state law. And I think that is the correct reading.
It is hard to tell if this Opinion Letter is meant to address employees who work a 10-hour day with overtime. However, I do think that if you truly have hourly, non-exempt employees who work a regular 10-hour day, with or without overtime, and get sick leave or PTO, we should pay them for their full day. We can talk about whether that day should be 10 hours or 11 hours. But it should not be 8 hours, in any case.
