It has been seven months since the enactment of California's new Paid Sick Leave law (AB 1522), also known as the Healthy Workplace, Healthy Family Act of 2014. By now you have probably implemented all the required processes and posted notices, issued forms, and so forth.
Lack of compliance can be an expensive and potentially devastating oversight for an employer. Your sick pay policies and practices must be adjusted according to the stipulations of this legislation.
So what does this mean for you? For one, it means that as of January 1st of this year, the qualifying periods that determine which employees are eligible for paid sick leave and the employee notice required by Labor Code 2810.5 became effective. Actual entitlement began on July 1st of 2015.
While the details of AB 1522 are quite extensive, there are a certain points that are most pertinent.
6 Points To Know About the Paid Sick Leave Law
While a large number of other new laws and regulations also went into effect at this year, few have had as significant and immediate impact on your payroll process as AB 1522, the new California Sick Leave Law.
Here are six points to keep in mind when revising your previous sick pay policies and practices:
1. Who is eligible for paid sick leave under the new law
An employee qualifies for paid sick leave by working for an employer on or after January 1, 2015, for at least 30 days within a year in California and by satisfying a 90 day employment period, which works like a probationary period, before an employee can actually take any sick leave.
Temporary employees of a staffing agency are covered by the new law. Therefore, whoever is the employer or joint employer is required to provide paid sick leave to qualifying employees.
2. How qualifying employees accrue and take paid sick leave
Starting July 1, 2015, employees will earn at least one hour of paid leave for every 30 hours worked. That works out to a little more than eight days a year for someone who works full time. But employers can limit the amount of paid sick leave you can take in one year to 24 hours, or three days.
Because paid sick leave accrues beginning on July 1, 2015 or the first day of employment if hired after July 1, 2015, the 12 month period will vary by hire date for those employees hired after July 1, 2015. Therefore, the measurement will mostly be tracked by the employee’s anniversary date.
3. Employers can provide more paid sick leave but not less
The new law establishes a minimum requirement, but an employer can provide sick leave through their own plan or establish different plans for different categories of workers. However, each plan must satisfy the accrual, carryover, and use requirements of the law or put the full amount of leave into the employee's leave bank at the beginning of each year in accordance with the PTO policy.
If an employer provides a policy which exceeds the minimum requirements, including providing a specific cap, the policy must be clear as to the additional terms that apply to their employees.
4. What reasons employees are allowed to take sick leave
An employee can take paid leave for themselves or a family member for preventive care or care of an existing health condition or for specified purposes if they are a victim of domestic violence, sexual assault or stalking. Family members include the employee’s parent, child, spouse, registered domestic partner, grandparent, grandchild, and sibling.
Preventive care would include annual physicals or flu shots. For partial days, you can require the employee to take at least two hours of leave, but otherwise the determination of how much time is needed is left to the employee.
5. Employer payment and tracking of earned and taken leave
The new law requires that an employer provide payment for sick leave taken by an employee no later than the payday for the next regular payroll period after the sick leave was taken. This does not prevent an employer from making the adjustment in the pay for the same payroll period in which the leave was taken, but it permits an employer to delay the adjustment until the next payroll.
Employees must be paid at their regular hourly rate. If their pay fluctuates because they receive a commission or piece rate, the employer will divide the total compensation for the previous 90 days by the number of hours worked and pay that rate.
6. Required information employers must provide their employees
Beginning January 1, 2015, employers were required to post in a conspicuous place at the workplace, a poster containing the following information:
- That an employee is entitled to accrue, request, and use paid sick days
- That retaliation or discrimination against an employee who requests paid sick days or uses paid sick days or both is prohibited
- That an employee has the right under this law to file a complaint with the Labor Commissioner against an employer who retaliates or discriminates against an employee.
In addition, employers are required to provide most employees with an individualized Notice to Employee that includes paid sick leave information.
You can find more information on the FAQ page of the State of California's Department of Industrial Relations website.
Be Informed, Be Compliant
An updated and streamlined sick leave strategy will help your organization meet its obligations, while providing accuracy and timeliness. So take time to understand the law, automate sick leave tracking and calculations, and prioritize accurate record keeping. In this way, you will make compliance a sure thing.
Another key step in maintaining HR compliance and increasing your company's cost-effectiveness is to consider outsourcing. A professional agency such a Accuchex can provide much-needed help with Human Resources needs and questions. Accuchex is a full spectrum Payroll Management Services provider offering expertise in Time Management, Insurance and Retirement issues, as well.
If you are looking for reliable resource for your HR issues, we can help. And you can get your Free Download: Payroll Outsourcing Guide to help you make an informed decision, or call Accuchex Payroll Management Services at 877-422-2824.