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New Paid Sick Days Law

On September 10, 2014, Governor Jerry Brown joined legislators and workers in Los Angeles to sign the Healthy Workplaces, Healthy Families Act of 2014 (AB 1522), which now mandates at least 3 paid sick days per year to California's workforce. With the Governor's signature, California became only the second state (after Connecticut) in the nation to require paid sick leave.

The law takes effect on July 1, 2015, and applies to employees (including part time and temporary employees) who have worked 30 or more days in California within a year of their employment. Under the law, for every 30 hours worked, employees will accrue one hour of paid sick leave, which can be used to care for themselves or a family member. Unlike other California leave laws, there is no exception for smaller employers.

Paid sick days may be used for the diagnosis, care, or treatment of an existing health condition for, or the preventive care of an employee, or an employee's immediate family member. Family members are defined to include spouses, registered domestic partners, children, parents (including step-parents and parents-in-law), grandparents, and siblings. Paid sick days are also available for employees who are the victims of domestic violence, sexual assault, or stalking.

Employers may limit employees to using 24 hours (or three 8-hour work days) of paid sick leave per year, and employers may cap total accrual of paid sick days at 48 hours (or six 8-hour work days). Employees are entitled to use the accrued sick days on the 90th day of their employment. The employees may decide the amount of leave they need to use. However, employers may set a reasonable minimum increment, not to exceed 2 hours, for the use of the paid leave. Accrued, but unused, sick days must carry over into the following year. However, employers may limit this to the 48 hour/six-day accrual cap. Unlike vacation laws, employees are not entitled to be paid for accrued but unused sick days upon resignation or termination of employment. However, the law requires that if an employee is rehired within a year of their separation, any unused sick leave that was previously accrued must be reinstated.

At the time of hiring, employers must provide new employees notice of their entitlement to paid sick leave and their right to file a complaint with the Labor Commissioner where retaliation occurs by the employer for an employee's use of, or request for the use of, accrued paid sick leave.
Employers will also be required to post a workplace notice created by the Labor Commissioner containing all the information related to these laws.

Employers are now also required to provide employees with written notice that sets for the amount of paid sick leave available or the amount of PTO leave provided in lieu of sick leave. This notice must be either on the employee's itemized wage statement or in a separate writing provided on the employee's pay date with the employee's payment of wages.

Records documenting employee sick leave usage and accrual must be retained for at least three years. These records must be made available for employee inspection within 21 days of a written or oral request. If an employer fails to keep adequate records, it will be presumed that the affected employee is entitled to the maximum number of accruable hours under the law, unless the employer can show otherwise by clear and convincing evidence.

Importantly, this law creates a rebuttable presumption of unlawful retaliation for any adverse employment action occurring within 30 days of an employee engaging in certain protected activity, such as the filing of a complaint with the Labor Commissioner, or opposing a policy practice or act of the Company.

If a violation of this law is found to have occurred, the Labor Commissioner may order "any appropriate relief" including reinstatement, backpay, payment of unlawfully withheld sick days, administrative penalties, and enforcement fines payable to the state. If paid sick days are found to have been unlawfully withheld, the employer will be penalized in the dollar amount of paid sick days withheld multiplied by 3 or $250, which is greater (with a maximum of $4,000.00). Further, if the violation of this law has resulted in additional harm to the employee (such as discharge), employers will also be subject to an administrative penalty of $50 for each day that the violation occurred. The law also authorizes the Labor Commissioner or the Attorney General to institute a civil action, on behalf of aggrieved employees, to seek as reinstatement, backpay, administrative penalties, liquidated damages, and reasonable attorney's fees.

Employers are encouraged to update their sick leave and record-retention policies, as well as their employee handbook to ensure compliance with these new laws. Employers must also ensure that they comply with the new notice and posting requirements, and that the employee itemized wage include the newly required written notice setting forth the available sick leave for PTO.