California Legislature Expands COVID-19 Supplemental Paid Sick Leave Through September 30, 2021 for Employers with More than 25 Employees: FAQ Guide

On March 19, 2021, Governor Newsom signed Senate Bill 95, which requires employers in California with more than 25 employees to provide COVID-19 supplemental paid sick leave to covered employees.  The bill takes effect on March 29, 2021, at which time the requirements will apply retroactively to January 1, 2021.  California’s previous supplemental paid leave expired on December 31, 2020 and SB 95 broadens the scope in various material ways.

Given the expansion of coverage, SB 95 (codified in Cal. Labor Code § 248.2 et seq.) raises significant compliance concerns for covered employers in California. And, because the bill takes effect shortly, covered employers need to understand what must be done in order to comply without expending unnecessary business costs. To this end, the following Frequently Asked Questions guide lays out the key aspects of SB 95 and answers some of the questions Michelman & Robinson, LLP has recently received about the new legislation.

Q:        What employers are covered under the law?

A:        The law broadens the definitions of covered employers to include employers who employ 26 or more employees nationwide.

Q:        What are the qualifying reasons for which an employee may take leave under the law?

A:           The law provides a total of seven qualifying reasons under which an employee will qualify for supplemental paid sick leave. These include receiving a vaccination, caring for others, school closures, and child care closures – all of which were not qualified reasons under previous legislation. The reasons are listed here:

  1. The covered employee is subject to a quarantine or isolation period related to COVID-19 as defined by an order or guidelines of the State Department of Public Health, the Centers for Disease Control or Prevention, or a local health officer who has jurisdiction over the workplace. If the covered employee is subject to more than one of the foregoing, the covered employee must be permitted to use COVID-19 supplemental paid sick leave for the minimum quarantine or isolation period under the order or guidelines that provides for the longest such minimum period;
  2. The covered employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
  3. The covered employee is attending an appointment to receive a vaccine for protection against contracting COVID-19;
  4. The covered employee is experiencing symptoms related to a COVID-19 vaccine that prevent the employee from being able to work or telework;
  5. The covered employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  6. The covered employee is caring for a family member who is subject to a quarantine or isolation period related to COVID-19 or who has been advised to self-quarantine due to COVID-19; or
  7. The covered employee is caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.

Q:        How many hours of supplemental paid sick leave must a covered employer provide under the law?

A:         A worker considered to be “full-time” by the employer is entitled to 80 hours of supplemental paid sick leave. Additionally, an employee who worked or was scheduled to work, on average, at least 40 hours per week in the two weeks before they received supplemental paid sick leave is similarly entitled to 80 hours of leave. Part-time employees are eligible for variable leave amounts based upon the amount of hours worked.

Q:        At what rate must supplemental paid sick leave be paid under the law, and is there a monetary cap?

A:         For nonexempt employees, supplemental paid sick leave shall be paid at the highest of four provided methodologies: 1) the rate calculated in the same manner as the regular rate of pay for the work week in which the covered employee uses sick leave; 2) the rate calculated by dividing the employee’s total wages (not including overtime) by the employee’s total hours worked in the full pay periods of the prior 90 days of employment; 3) the state minimum wage; or 4) the local minimum wage. This calculation requires an individual analysis each time an employee takes qualified leave.

For exempt employees, the rate of pay shall be calculated in the same manner as the covered employer calculates wages for other forms of paid leave (i.e., by determining the employee’s hourly rate of compensation based on the employee’s salary). Importantly, the amount of COVID-19 supplemental paid sick leave is capped at $511 per day, and $5,110 total per employee.

Q:        May an employer require an employee to exhaust his or her regular paid sick leave (or other paid or unpaid time off) before providing supplemental paid sick leave under the law?

A:         No. Supplemental paid sick leave under the law is to be used first, followed by any other paid or unpaid leave, paid time off, or vacation time to which the employee may be entitled.

Q:        Is the leave bank under the law in addition to other forms of paid and/or unpaid leave?

A:         Yes. The leave bank is in addition to the paid sick leave previously made available under AB 1867 (which expired in December 2020).

Q:        How does paid sick leave under the law interact with other COVID-19-related leave requirements, including the LA County Regulations & OSHA’s Emergency Temporary Standard?

A:         Employers who already provide COVID-19 specific supplemental paid sick leave for leave taken after January 1, 2021 that is available for the same reasons and paid at the same rates may count those hours toward the supplemental paid sick leave obligation under the new legislation. This means that an employer will not be subject to any form of double payment.

Q:        Do employers have any notice and tracking requirements under the law?

A:         Yes. Employers must track available supplemental paid sick leave and provide the same as a separate line item on employee paystubs. Employers must additionally provide employees with written notice of the supplemental paid sick leave made available by the law, on either the employee’s itemized wage statement or in a separate writing provided on the designated pay date with the employee’s payment of wages. The Department of Industrial Relations has provided a sample notice, which can be found here:

Q:        Is a covered employer required to show the supplemental paid sick leave bank on wage statements?

A:         Yes, employers are required to provide the supplemental paid sick leave bank on each wage statement (separate from the ordinary leave bank). For employees with part-time or variable schedules, the law allows employers to do an initial calculation of leave time with the notation “variable” next to it. Employers will need to provide updated calculations related to the supplemental paid sick leave bank for these employees upon request.

Q:        Does the law apply retroactively and when does it end?

A:         Yes, the law applies retroactively to January 1, 2021 for leaves taken for any reason covered by the legislation, and ends September 30, 2021, unless extended or otherwise replaced. If an employer did not compensate a covered employee in an amount equal to or greater than the amount the employee is entitled to under SB 95, the employer shall provide such retroactive compensation. However, this obligation only triggers upon written or oral request by a covered employee of the employer. Employers should carefully track employee absences and the reasons for said absences to prepare for any employee requests of this nature.

Of course, the employment attorneys at M&R are available to answer any questions you may have about the implications of SB 95.

This blog post is not offered, and should not be relied on, as legal advice.  You should consult an attorney for advice in specific situations.