Effective Now! California Expands COVID-19 Related Paid Sick Leave.

by Victoria Dolan

As a result of the ongoing pandemic, we have experienced an unprecedented level of related emergency legislation. Just when we think we have it down, something new pops up. The Governor is busy signing new legislation, here is one of the latest developments to impact California employers related to COVID-19.

FIRST A LEGISLATIVE HISTORY LESSON ON COVID-19 PAID LEAVE:

The Families First Coronavirus Response Act (FFCRA)

When the national FFCRA law went into effect on April 1, 2020, it required most employers with fewer than 500 employees to provide two weeks (up to 80 hours) of emergency paid sick leave when the employee is unable to work or telework for the following qualifying reasons:

  1. The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
  2. The employee has been advised by a health care provider to self-quarantine related to COVID-19.
  3. The employee is experiencing COVID-19 symptoms and is seeking a medical diagnosis.
  4. The employee is caring for an individual subject to an order described in #1 or self-quarantine as described in #2.
  5. The employee is caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19.
  6. The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury. (Note, to date, the Secretary has not specified a qualifying condition under this provision, so it is currently not applicable.)

The FFCRA covers employers in the United States, with fewer than 500 employees, however, there are some gaps where workers are not covered:

  • Employees working for employers with 500 or more employees
  • Independent contractors and “gig” workers
  • Health care providers and emergency first responders can be excluded at the employer’s option
  • Some public sector employer exceptions
  • Limited exceptions for small business employers with fewer than 50 employees if providing leave would jeopardize the viability of the business as a going concern

The interpretation of health care providers who may be excluded from the FFCRA benefits has narrowed and cannot be applied to all employees of a company in the health care industry, but rather should only be applied to employees who are performing diagnostic, preventative, treatment or other duties that are directly integrated with patient care. Examples include doctors, nurses, lab technicians, or care providers carrying out a course of treatment or care that if not performed would negatively impact patient care. These tasks also must be something that, if not performed, would adversely affect the patient’s care, and they also must be integrated into that patient’s care.

CA Executive Order N-51-20

Subsequently, Governor Newsom issued Executive Order N-51-20 which went into effect on April 16, 2020. The Order provided up to 80 hours of COVID-19 Supplemental Paid Sick Leave for essential food sector workers (including “gig” worker/independent contractors) working for hiring entities with 500 employees or more. (More details available on our blog: https://www.holdenlawgroup.com/california-expands-protections-for-essential-food-workers/.)

NEW! AB 1867 – Small employer family leave mediation: handwashing: supplemental paid sick leave.

The Executive Order closed the gap for essential food sector workers, but uncharacteristically for California, still left most of the FFCRA gaps intact. So, not surprisingly, on September 9, 2020, the Governor signed AB 1867 which codified the Executive Order and expanded upon it to close many of the gaps left by the FFCRA. The new rules effective September 19, 2020 essentially provide for most California workers (excluding independent contractors outside of the food sector) to be covered for two weeks of COVID-19-related paid sick leave. However, unlike the FFCRA, there are no qualifying reasons to care for others. Rather, to qualify for paid leave, covered workers can be eligible for three reasons:

  1. They are subject to a government quarantine or isolation order related to COVID-19.
  2. They have been advised by health care provider to quarantine or isolate due to concerns related to COVID-19.
  3. They are prohibited from working by the hiring entity due to health concerns related to potential transmission of COVID-19.

AB 1867 contains multiple provisions. It adds Labor Code Section 248 (LC 248) which essentially converted Executive Order N-51-20 into law and is specific to the food sector. It also created Labor Code Section 248.1 (LC 248.1) which mimics LC 248 for entities outside of the food sector. Both apply to employers and hiring entities with 500 or more workers. LC 248.1 also specifies that employers and hiring entities of health care providers and emergency responders with fewer than 500 employees who have elected to exclude such employees from emergency paid sick leave under the FFCRA must provide COVID-19 supplemental paid sick leave for the three reasons outlined above.

There is some good news for employers who may already have generous paid time off benefits because LC 248.1 specifies that if a hiring entity already provides a covered worker with a supplemental paid benefit that can be used for the three reasons listed above then the hiring entity may count the hours of the other paid leave benefit towards the total number of hours of COVID-19 supplemental paid sick leave (as long as the worker is compensated in an amount equal to or greater than what is required by the law). It is important to note, however, that the 24 hours (three days) of mandatory paid sick leave under California’s existing Healthy Workplaces Healthy Families law cannot be counted toward the COVID-19 supplemental paid sick leave entitlement. Additionally, under LC 248.1 if a hiring entity already provided supplemental leave after March 4, 2020 for one or more of the three qualifying reasons but did not compensate the covered worker (or did not compensate at the level required under AB 1867), the employer may retroactively provide supplemental pay to the covered worker to satisfy the compensation requirements and may then count those hours towards the total number of hours of COVID-19 supplemental paid sick leave required. Thus, employers are not required to provide two weeks of additional leave if two weeks of COVID-19 supplemental paid leave have already been provided for a covered reason.

KEY SIMILARITIES BETWEEN THE FFCRA AND CALIFORNIA’S REQUIREMENTS:

First, it’s helpful to understand all of the areas that the various laws have in common:

  • Workers are generally going to be entitled to two weeks of paid sick leave for a COVID related reason if they personally need to isolate or quarantine themselves. The two weeks is typically capped at 80 hours for full-time employees (with an exception for California active firefighters who may receive more based on their schedule) and pro-rated for part-time workers.
  • Like emergency paid sick leave under the FFCRA, COVID-19 supplemental paid sick leave must be at the regular rate of pay, but total paid benefits can be capped at $511 per day.
  • Employees must still be allowed to take their 24 hours or three days of California paid sick leave in addition to two weeks of additional time for COVID-19 related qualifying reasons. Employees cannot be required to use any other form of paid sick leave or time off benefits before using COVID benefits.
  • California’s law is designed to sync up with the FFCRA in terms of expiration date, which is currently December 31, 2020. Employees with COVID-19 leaves starting on or before year end, are still entitled to take the full two weeks of leave, so long as the qualifying reason started on or before December 31, 2020.

KEY DIFFERENCES BETWEEN THE FFCRA AND CALIFORNIA’S REQUIREMENTS:

Next, the laws differ in some important ways:

  • More covered workers – by wrapping in large employers, food sector workers (including gig workers and independent contractors), healthcare workers, and emergency responders, California’s law effectively ensures that most workers not already covered by the FFCRA have access to paid sick leave benefits if a COVID related reason prevents them from working.
  • Fewer covered reasons – California’s law focuses on ensuring workers are provided with paid time when they need time off to care for themselves related to COVID-19. It does not provide for time off to care for others like the FFCRA. Most notably, California’s law does not provide for expanded FMLA leave related to school or daycare closure.
  • Employers foot the bill – unlike the FFCRA which provides employers with reimbursement  through payroll tax deduction for the cost of the COVID-19 related paid time off benefits, California’s law has no such provision.
  • Paystub requirement – LC 248.1 requires that available COVID-19 supplemental paid sick leave must be reflected on employee paystubs, in the same manner as California’s existing 24 hours of paid sick leave. The FFCRA and LC 248 do not have a paystub requirement.

PUTTING IT ALL TOGETHER, WHAT DOES THIS MEAN FOR YOUR BUSINESS?

So, keeping all of this in mind and with the history lesson out of the way, how should you proceed?

  • For employers of health care providers and emergency first responders who have been opting to exclude these employees from taking emergency paid sick leave (EPSL) under the FFCRA, decide whether to continue that practice or to consider offering the FFCRA EPSL to all employees.
    • The advantages of this approach are first, EPSL will be made available to all of your employees rather than just the administrative or support functions of your staff; and second, you will not bear the cost burden of providing these benefits because you can take the payroll tax credit under the FFCRA.
    • The potential disadvantage is that you must allow employees to use EPSL for all five of the qualifying reasons under the FFCRA. That is, you cannot limit the reasons for taking EPSL to only the three reasons provided under California’s law. This means that while you are not required to offer the 12 weeks of expanded FMLA benefit related to school or daycare closure if you choose to offer EPSL, you would have to allow an employee to use two weeks of EPSL for this purpose if they choose to do so.
  • Determine which paid sick leave regulations will apply to your workers and provide employees with the appropriate required notice:
  • When you have paid leave benefits that can be used for the COVID-19 qualifying reasons, decide whether you will use them as a credit toward the California COVID-19 supplemental paid sick leave requirement, or if they will be in addition to the COVID-19 requirement. For example, if your paid sick leave policy provides for 48 hours of paid sick leave which is 24 hours over the 24 hour/three day requirement in California, a full-time 40 hour employee would have to be provided with an additional 56 hours of COVID-19 supplemental paid sick leave hours to meet the California requirement (24 + 56 = 80). [Note, this choice does not apply when following the FFCRA, all FFCRA benefits are in addition to existing paid time off benefits. Therefore, if providing benefits under the FFCRA, employees must be provided with 104 hours of COVID-19 related sick leave (24 + 80).]
  • When operating under LC 248.1, be sure to update your payroll systems to reflect available CA COVID-19 supplemental paid sick leave hours on employee paystubs.

Although fairly detailed, this is merely a summary of a complex area of law, so feel free to reach out if you have additional questions that I have not addressed.