New COVID-19 Supplemental Paid Sick Leave?
Yesterday, March 18, 2021, the California Legislature officially passed a new bill regarding COVID-19 supplemental paid sick leave, and we anticipate it will be signed by Governor Newsom. A previous law provided for COVID-19 supplemental paid sick leave for those in the food sector, certain health care providers or emergency responders, and private businesses of 500 or more employees through December 31, 2020. This new law would apply to business with 25 or more employees and requires supplemental paid sick leave--in addition to what paid sick leave the employer already provides--for employees who cannot work or telework for any of the following reasons:
The covered employee is subject to a quarantine/isolation related to COVID-19 by a state or federal order or guideline, or by a local health officer. If that employee is subject to more than one of the foregoing, they may use COVID-19 supplemental paid sick leave for the minimum quarantine/isolation period.
The covered employee has been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19.
The covered employee is attending an appointment to receive a vaccine for protection against contracting COVID-19.
The covered employee is experiencing symptoms related to a COVID-19 vaccine that prevent the employee from being able to work or telework.
The covered employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
The covered employee is caring for a family member (including their child, parent, legal guardian, spouse, registered domestic partner, spouse's or registered domestic partner's parent or legal guardian, grandparent, grandchild, or sibling) who is subject to an order, guideline, or instruction to self-quarantine as described above.
The covered employee is caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.
Ten days after the bill is signed into law, full-time employees will be entitled to up to 80 hours of supplemental paid sick leave if they averaged 40 hours per week in the previous two weeks before the leave. Otherwise, the hours of supplemental leave are variable based on the total number of hours the covered employee is normally scheduled to work for the employer over two weeks. This is subject to a maximum pay of $511 per day for a total of $5,110.
Additionally, employers will also have to provide notice of the availability of this supplemental paid sick leave, and it could be sent through electronic means. Once the Governor signs the bill, the Labor Commissioner will be developing a model notice, which we will add here once it becomes available.
Just like before, the state is not providing any tax relief for paying supplemental sick leave. However, the recent American Rescue Plan extension of the FFCRA’s Emergency Paid Sick Leave does offer the employees tax relief for “voluntarily” offering sick leave and family leave to their employees (READ MORE HERE). As a result, employers with between 25 and 500 employees should look into voluntarily complying with the extension of the FFCRA so that they can try to qualify for tax credits while providing this supplemental leave. Though it is not guaranteed that the federal agencies will give those tax credits now that California employers are not “voluntarily” providing the sick leave but instead must do so under state law, at this time there appears to be little harm in employers trying to follow the requirements of both laws in order to try and obtain the federal tax credit.
Unfortunately for employers, the bill states that it is retroactive to January 1, 2021, which would require employers to pay the difference owed under this bill and anything they may have already paid, upon oral or written request by the employee. Such pay would be owed on or before the next regularly scheduled payday following the request. We anticipate that this provision will be contested in the courts, so we will stay apprised of any litigation and provide updates as necessary. It may also be prudent for employers to hold off on issuing retroactive pay until the initial legal challenges are decided.