COVID-19 Hazard Pay Ordinances

by Holden Law Group

During the COVID-19 pandemic, most Californians have received the benefit of California grocery, drug store, and other front-line workers continuing to sell essential products, stock shelves, clean buildings, and otherwise keep our economy moving.  As a result, cities and counties are getting in line to provide a temporary pay boost.  In case you have not heard, local and county officials have taken action by forcing employers of these workers to provide premium pay for their front-line service, and the trend is not slowing down.  In fact, even despite lawsuits pending against four cities by the California Grocers Association over “hazard pay” or “hero pay” obligations that have pushed onto employers, several more cities and counties have passed, or are considering passing ordinances for hazard pay as a reward for their front-line service.

Just in the last week, ordinances took effect in six jurisdictions including: San Francisco, San Jose, and Irvine.

Overall, roughly 47 cities and counties in California have considered ordinances providing additional pay to grocery and drug store employees, as well as some other essential workers, such as maintenance workers and security guards. So far, roughly 25 have enacted hazard pay ordinances and that number is expected to rise.

Who pays for all this hazard pay?  No, not the taxpayers.  Rather, the pay is in the form of an immediate (and sometimes retroactive) hourly wage increase (between $3 to $5 an hour that local governments impose on local businesses).

Hazard Pay Ordinances Currently in Effect

As of March 29, 2021, the following cities or counties have hazard pay ordinances in place, requiring additional wages ranging from $3 to $5 per hour, effective as of the dates shown:

  • American Canyon (3/25/21) ($5/hr.)
  • Berkeley (2/23/21) ($4/hr.)
  • Buena Park (4/8/21) ($4/hr.)
  • Coachella (3/26/21) ($4/hr.)
  • Costa Mesa (3/16/21) ($4/hr.)
  • Daly City (3/28/21) ($5/hr.)
  • Irvine (3/25/21) ($4/hr.)
  • Los Angeles (City) (3/8/21) ($5/hr.)
  • Los Angeles County (2/23/21) ($5/hr.)
  • Long Beach (1/19/21) ($4/hr.)
  • Millbrae (3/9/21) ($5/hr.)
  • Montebello (1/27/21) ($4/hr.)
  • Oakland (2/2/21) ($5/hr.)
  • Pomona (3/2/21) ($4/hr.)
  • San Francisco (3/22/21) ($5/hr.)
  • San Jose (3/25/21) ($3/hr.)
  • San Leandro (2/16/21) ($5/hr.)
  • Santa Ana (3/2/21) ($4/hr.)
  • Santa Clara (County) (3/9/21) (to be eff. 4/8/21) ($5/hr.)
  • Santa Monica (3/10/21) ($5/hr.)
  • South San Francisco ($5/hr.) (2/25/21, retroactive to 2/11/21)

Hazard Pay Ordinances That Have Passed but Are Not Yet in Effect

As of March 29, 2021, the following cities or counties have adopted ordinances that will become effective on the dates indicated:

  • Alameda (City) (5/6/21) ($5/hr.)
  • Alhambra (5/12/21) ($5/hr.)
  • El Monte (4/15/21) ($4/hr.)

Generally, common elements among the ordinances include: the scope of coverage, which specific employers are covered, the amount of required hazard pay, and the duration of the ordinance. Additional provisions often prohibit retaliation, provide credits for employer-initiated hazard pay, require employers to post notice of the ordinance at the workplace, and require certain record-keeping standards.

Who is Covered?

By the looks of it, the City of Los Angeles’s ‘Premium Hazard Pay for On-Site Grocery and Drug Retail Workers Ordinance’ has served as a template for other local jurisdictions (with some exceptions noted below). The Los Angeles ordinance has these key terms:

  • “Premium Hazard Pay.” Los Angeles premium pay ($5 per hour) is in addition to all other forms of compensation (from hourly wages to bonuses) and reimbursement.
  • “Employer.” A Los Angeles covered “employer” is a grocery, drug, or retail store, with more than 300 employees nationwide and more than 10 employees on-site at a Los Angeles store that either primarily sells grocery items (including both food and household goods) or sells various prescription and nonprescription medicines, along with other sundries or is a retail store with over 85,000 square feet of retail space, 10% of which is dedicated to either groceries or drug retail.
  • “Employee.” A Los Angeles covered “employee” is any individual who, during a particular week, performs at least two hours of work for a covered employer within the city and is entitled to the California minimum wage.

Depending on the county, salaried managerial workers may or may not be entitled to hazard pay. For example, exempt managers are ineligible for hazard pay in Los Angeles and Daly City.  However, San Francisco employees, both hourly and salaried, are entitled to hazard pay to the extent that they earn less than $35 per hour (whether paid hourly or by an equivalent salary, based on a 40-hour workweek).

Other Common Requirements between the Local and County Ordinances are as follows:

Credit for previous employer-initiated hazard pay: The ordinances typically allow employers who are voluntarily providing hazard pay to offset the amount already being paid against the mandated additional pay. The credit typically must be clearly identified on wage statements.

Enforcement: Most ordinances empower not only local enforcement officials, but also employees to sue the employer for violations of the ordinance.

Anti-retaliation: Most hazard pay ordinances state that employers cannot discharge employees, reduce their compensation, or otherwise discriminate against them for asserting their rights under the ordinances.

Enforcement: Most ordinances empower not only local enforcement officials but also employees to sue the employer for violations of the ordinance.

Notices to Employees: The ordinances usually require employers to post a notice in a conspicuous spot at the workplace, to provide a copy of the notice to employees, or both. San Francisco provides the requisite poster for employers online and Irvine promises to do so as well. In locales that do not provide a sample, employers must create their own notices.

Sunset Clauses: Most ordinances are set to expire 90 or 120 days after the ordinance takes effect. But some cities, such as South San Francisco, have linked the effective dates of the ordinance to California’s Blueprint for a Safer Economy: once a pre-designated reopening tier applies, the ordinance sunsets.

Individual Oddities

Although most of the hazard pay ordinances are similar, a few have some interesting oddities:

San Francisco requires only that eligible grocery and drug stores with at least 500 employees nationwide and at least 20 employees in San Francisco to provide hazard pay. But the San Francisco ordinance also covers third-party janitorial and security contractors whose employees work in covered grocery and pharmacy retail stores, regardless of how many employees the contractor has. Therefore, if a small to medium sized security contractor services a large grocery store, then the security contractor must comply with the ordinance.

In addition, San Francisco imposes a cap on the mandated hazard pay. Covered San Francisco grocery and drug store employers must pay all employees an additional $5 per hour, up to a maximum of $35 per hour. As such, an employee who already earns $33 per hour would be entitled to hazard pay of only $2 per hour.

South San Francisco requires employers to pay employees up to four hours for time spent obtaining a COVID-19 vaccine. South San Francisco’s ordinance (effective February 25, 2021) also makes hazard pay retroactive to February 11, 2021.

Keep Your Guard Up

These ordinances often pass with little advance notice and with little media coverage. In addition, each locality often has its own idea of what obligations should fall on the grocery, drug, and retail stores operating in the area. So, keep your guard up and your eyes peeled for hazard pay ordinances in your area.

Holden Law Group continues to monitor local, state, and federal legislation pertaining to COVID-19.  If you have questions about premium pay ordinances or other employment concerns related to COVID-19, contact us to discuss.