Posted on November 6th, 2017
What Employers Need to Know About California Sick Leave Law
California sick leave law is one of those things that we see pop up over and over again as a thorn in the side of employers.
This is mostly because, while most employers want to comply, the law can be confusing. In this post we will give you some of the most important points about California sick leave law to ensure compliance in your business. It is so important to understand and have company sick pay policies.
Everyone gets sick every now and then, and in California, there are laws requiring employers to offer sick leave pay.
So unless you want to end up in legal trouble, you should pay close attention to the California sick leave law.
Read the following guide to get a better understanding of how it all works.
The Recent Changes in California Sick Leave Law
The sick leave laws as they are now is a pretty recent change. It all started when California Governor Jerry Brown made the Healthy Workplaces, Healthy Families Act of 2014 (AB1522).
It went into effect July 1, 2015 and requires all California employers to offer a minimum towards employees’ annual sick leave pay.
How the California Sick Leave Law Affects Your Business
On average, workers accumulate one hour of sick leave for every 30 hours worked. So this requires you to keep track of how many sick leave hours each of your employees generate. And you’ll also have to report the balance each pay period, then deduct hours used from the balance.
So Who Qualifies Under this Act?
Now, this is a great question. In most cases, employees who put in more hours are normally entitled to more benefits. However this time, it’s a bit different Under this Act, California employees who work at least 30 days in a one-year period qualify for sick leave.
So part-time and temporary employees qualify, but with some exceptions.
Determining How Much Sick Leave to Pay Your Employees
There are different ways you can calculate sick leave for your employees. For instance, you can accrue the sick leave balance based on the hours worked each pay period. Or another option is to give employees a lump sum at the start of each year.
But either way, you have to give employees at least one hour for every 30 hours they work. So if you go with the lump sum option, you’ll have to give employees three days (or 24 hours).
How to Report Sick Leave
It’s required for employers to show the number of sick leave days employees have on their pay stub. Or you can display this on a separate document that’s issued at the same time as paychecks.
There are services you can use to help calculate and report sick leave balances. One worth checking out if you have a small business is Square Payroll.
Paying Out Sick Leave
Now, it’s important to pay out sick leave at the same hourly rate employees receive. Also, it’s important to note that employees who quit working for you aren’t entitled to their remaining sick leave balance.
What Happens If Your Employees Don’t Use Their Sick Leave?
In the event employees don’t use their sick leave pay for the year, they can roll over up to 48 hours for the next year. However, you’re allowed to limit sick leave taken per year to 24 hours.
Then if you give employees 24 hours of sick leave pay upfront at the beginning of the year, then whatever’s remaining doesn’t have to roll over.
Are There Any Exemptions to the California Sick Leave Law?
There are a few exceptions within the California sick leave law. The law applies to most workers, including part-timers who’ve put in overtime, temp and seasonal workers, and staff agency employees and contractors.
However, the exemptions apply to in-home supportive service employees, airline cabin crew, aviation employees, construction industry employees and those working under a collective bargaining agreement and earn at least 30% of the state’s minimum wage ($10/hr as of 2016).
Checklist for Complying with the California Sick Leave Law
To help ensure you’re complying with the sick leave law of California, here is a quick checklist:
Calculate, track and report the sick leave balance for each employee
Give a written copy of your sick leave policy to each employee upon hiring
Put up a poster that explains your company’s sick leave policy
Give at least 24 hours (3 days) paid sick leave annually to eligible employees
Show available sick leave days on pay stub or attached document
Maintain a record of sick leave hours earned and used for past three years
What If You Already Had a Generous Sick Leave Policy?
Now, it’s important to understand that if you already had a generous sick leave policy for employees, it may not meet the standards of the California law. For instance, some employers don’t include sick pay for employees needing to care for family members.
In the sick leave law, family members covered include grandchildren, siblings, grandparents, registered domestic partners, spouse, parents and children.
Then some employers excluded part-timers from their sick leave policy, who are now covered under the California law.
Also, accrual rates may not be accurate in these older policies. So with all this, it’s very important to update your policy.
Putting a Cap On Your Sick Leave
If you end up using an accrual method, you should consider whether to place a cap on how much can accrue. On average, employees can generate up to 9 days of paid sick leave annually. This is based on the one hour for every 30 hours worked calculation.
Then the days accrued can carry over to the following year. Unless you impose a cap. Under the sick leave law, employers are able to impose a cap of 48 hours, which equates to six days.
So once reaching the cap, no hours will accrue until those hours are used.
Create a Custom Sick Leave Policy
Trying to keep up with the times is hard enough for business owners. Throw on top of that all the new employment laws being passed, and you have yourself the potential of landing in legal hot waters.
So it’s necessary to stay abreast of policy changes and quickly make amendments to your own company policies. But when push comes to shove, you can obtain legal guidance. This way, you can ensure everything is in accordance with California laws.
At Defend My Biz, I extend my legal expertise to businesses like yours.
If you’re looking to have your sick leave policy updated or created from scratch, I can help.
We offer an affordable package of policies and procedures you can use with your employees that covers sick leave pay and the other California labor laws that can get you in trouble.