Written by: Carl Larson

Category: General Legal Updates

The long-awaited amendments to the paid sick leave (“PSL”) law have arrived. They make a good number of clarifications, change calculations of sick pay, provide a grandfather clause for pre-existing PTO plans, and lays out how it affects certain state employees. Although the amendments still do not explain how the “24 hours or 3 days of sick leave” translates for employees working 10 hour regular shifts, it is a welcome change from the previous version of the law.
A breakdown of the changes is as follows:
Threshold qualification for leave is now employment in California for the same employer for 30 or more days within a year from the commencement of employment.
Broadens the construction exclusion to include construction work not performed onsite.
Excludes retired annuitants of public entities from the PSL law.
Accrual Basis
Allows for accrual on any period basis so long as it is a regular basis and will result in at least 24 hours or 3 days of sick leave available by the 120th calendar day of employment.
No longer limited to using basis of 1 PSL hour accrued for every 30 hours worked.
Can be by pay period or other regularly occurring period of time.
Frontloaded sick days are allowed to be provided for each year of employment, calendar year, or 12 month period.
Use of Sick Leave
Allows employers to limit the use of sick leave to 3 days or 24 hours in each year of employment,calendar year, or a 12 month period.
Payment of Sick Leave
Allows three methods of calculating how sick leave is paid and clarifies the formulas regardless of whether the employee has different hourly rates, or is paid by commission or piece rate.
For non-exempt employees:
Method 1: PSL pay is calculated based on regular rate of pay during the workweek in which the employee uses paid sick time whether or not the employee actually works overtime in that workweek.
Method 2: PSL pay is calculated by dividing the employee’s total wages, not including overtime, by the total number of hours worked in the full pay periods of the prior 90 days of employment.
For exempt employees:
Method 3: Paid sick time is calculated in the same manner as the employer calculates wages for other forms of paid leave time.
Employee Reinstatement
Makes clear that an employer who rehires an employee within 12 months of separation is not required to reinstate any paid time off that was cashed out.
Tracking of Sick Leave
Allows employers with unlimited leave policies to indicate “unlimited” on the wage statement.
Makes clear the employer has no obligation to inquire into purposes of sick leave.
PTO Compliance Method
Employers who provide a paid time off (“PTO”) or other paid leave policy (not limited to sick leave) that provides an amount of leave that can be used for the same purposes under the same conditions, do not need to provide additional sick days under the PSL law if:
It satisfies the accrual, carry over, and use requirements of the PSL law listed above.
It satisfies the new grandfather clause:
An employer provided paid sick leave before January 1, 2015 pursuant to a sick leave or PTO policy on any regular accrual basis that resulted in at least 1 day or 8 hours of leave within the first three months of employment of each calendar year or 12 month period and the employee was eligible to earn at least 3 days or 24 hours within 9 months of employment. If the plan is modified from the one in place Jan 1, 2015, then it must comply with the new PSL law requirements.
State Employees
For state employees, leave provided pursuant to specified sections of the government code covering leave or as part of a memorandum of understanding will satisfy the requirements of the paid sick leave law.
Notice Requirements
Delays the notice of PSL rights requirement for employers covered under wage order 11 and 12 to Jan 21, 2016.
Counsel to Management:
The new amendments provide a great deal more flexibility in crafting a PSL plan that complies with the law. It will also ease some of the administrative burden of implementing these policies. Check with the experts at the Saqui Law Group to be certain your existing policy complies, and is still meeting your needs.