FRESNO, California – With many questions surrounding the Paid Sick Leave law in California, Datatech would like to update you on the California Labor Commissioner’s updated ‘frequently asked questions’ about this new law. California’s new Paid Sick Leave law, AB 1522, came into law on January 1, 2015 and was amended in AB 304, effective July 13, 2015.
Many questions lingered about employers with pre-existing paid time off plans and the rate of pay they provided employees for this benefit. There was also a question about whether disciplinary action could be taken if an employee use PSL for a doctor’s appointment. The DIR has thus updated their website with the latest answered questions from the Labor Commissioner on these topics.
Datatech, which serves the ag industry with cost accounting and payroll software solutions, follows these updates for our many payroll clients. The following is the latest released information on this provided by the California Department of Industrial Relations.
Questions about An Employer’s Use of a “Grandfathered” (Existing) Paid Time Off Plan to Provide Paid Sick Leave
1. If my employer already had a paid time off plan that employees could use for paid sick leave before this law went into effect in 2015, was my employer required to provide additional sick days in response to the new law?
No. The statute has provisions that allow for what are commonly referred to as “grandfathered” paid time off plans. Basically, in very general terms, and as described in more detail in additional FAQs below, if at the time the law went into effect in 2015, an employer already had an existing paid leave policy or paid time off plan, and if that existing policy or plan made an amount of paid leave available that could be used for at least as many paid sick days as required under the new law, and that could be used under the same conditions as specified in the new law, or that had conditions more favorable to employees, (i.e., that provided more sick days than created under the new law, or that had a more favorable accrual rate, etc.), the employer is allowed to continue to use that existing paid time off plan in order to satisfy the paid sick leave requirements of the new law.
2. If my employer is providing paid sick days through an existing (grandfathered) paid time off policy, does the new law change the rate of pay my employer is required to pay for days that I take off under the existing paid time off policy for reasons other than a paid sick day?
No, the paid sick leave law addresses only the rate of pay that must be paid for time taken off as paid sick leave; it does not address or impact the rate of pay for paid time off taken for other purposes, such as vacation time or personal time.
Under the paid sick leave law, an employer must pay an employee for time taken for paid sick leave using any of the following calculations:
- (1) Paid sick time for nonexempt employees shall be calculated in the same manner as the regular rate of pay for the workweek in which the employee uses paid sick time, whether or not the employee actually works overtime in that workweek.
- (2) Paid sick time for nonexempt employees shall be calculated by dividing the employee’s total wages, not including overtime premium pay, by the employee’s total hours worked in the full pay periods of the prior 90 days of employment.
- (3) Paid sick time for exempt employees shall be calculated in the same manner as the employer calculates wages for other forms of paid leave time.
(Lab. Code § 246, subd. (l), emphasis added.)
In general terms, these provisions mean that time taken off as paid sick leave must be paid at an employee’s regular rate of pay, either for the workweek in which the paid sick leave was taken, or as determined by averaging over a 90-day period.
An employer using a “grandfathered” (i.e., existing) paid time off policy or plan must ensure that the plan “makes available an amount of leave applicable to employees that may be used for the same purposes [i.e., for paid sick leave] and under the same conditions [i.e., paid at the same rate] as specified in” section 246 of the new law. This means that an employer using a grandfathered paid time off plan must ensure that time that is taken off for paid sick leave must be paid in the manner as specified in the new law (as quoted and summarized above).
The new paid sick leave law, however, does not address in any way, nor impact, how employers must compensate employees under existing paid time off plans for time that is taken off for purposes other than paid sick leave, for example, for time that is taken as vacation, or for personal holidays, etc. (Note, however, the provisions of Labor Code section 227.3 concerning the requirements for payment for vested vacation time at termination of employment.) In practical terms, this means that an employer may compensate employees under an existing paid time off plan for vacation or personal holiday time, during employment, at a “base rate” of pay, whereas time taken as paid sick leave must be paid at a higher regular rate of pay (determined for the workweek or by a 90-day average), as described above.
Paid Sick Leave and Employer Attendance Policies
3. Can my employer discipline me for taking a paid sick day or for using paid sick leave for part of a day to go to a doctor’s appointment?
In general, no, an employer may not discipline an employee for using accrued paid sick leave. Depending on the circumstances, however, the issue may be more complex and may require more analysis.
The paid sick leave law specifically says the following:
An employer shall not deny an employee the right to use accrued sick days, discharge, threaten to discharge, demote, suspend, or in any manner discriminate against an employee for using accrued sick days, attempting to exercise the right to use accrued sick days, filing a complaint with the department or alleging a violation of this article, cooperating in an investigation or prosecution of an alleged violation of this article, or opposing any policy or practice or act that is prohibited by this article.
(Lab. Code § 246.5, subd. (c)(1).)
Separately, Labor Code section 233 (commonly referred to as the “Kin Care” law) requires an employer to allow an employee to use accrued and “available” sick leave (which is the amount that would accrue during a six month period) for the purposes specified in the paid sick leave law. Labor Code section 234 provides that “[a]n employer absence control policy that counts sick leave taken pursuant to Section 233 as an absence that may lead to or result in discipline, discharge, demotion, or suspension is a per se violation of Section 233.”
This means, in general terms, that if an employee has accrued sick days available, an employer may not deny the employee the right to use those accrued paid sick days, including the right to use paid sick leave for a partial day (e.g., to attend a doctor’s appointment), and may not discipline the employee for doing so.
Many employers have attendance policies under which employees may be given an “occurrence” or similar adverse personnel action (which is a form of discipline with potentially negative repercussions) if the employee has an unscheduled absence or provides insufficient notice of an absence. Under the terms of the paid sick leave law (and Labor Code sections 233 and 234), if an employee has accrued and available sick leave, and is using his or her accrued paid sick leave for a purpose as specified in the law, it is not permissible for an employer to give the employee an “occurrence” for the absence under such an attendance policy because this would constitute a form of discipline against an employee for using his or her paid sick leave as allowed under the paid sick leave law.
If an employee does not have any accrued or available paid sick leave, however, (e.g., if the employee has already used all of his or her accrued and available paid sick leave under the employer’s policy, including as consistent with Labor Code section 233), and if the employee has an unscheduled absence that would otherwise violate the employer’s attendance policy, the paid sick leave law does not prohibit the employer from giving the employee an “occurrence” for such absence, even if the employee was actually sick and/or could have used paid sick leave for the absence if he or she had any such leave accrued. The paid sick leave law does not “protect” all time off taken by an employee for illness or related purposes; it “protects” only an employee’s accrued and available paid sick leave as specified in the statute.
Similarly, if an employee has an absence that would otherwise violate the employer’s attendance policy, and if the absence was for a reason not covered under the paid sick leave law, the employer is not required to allow the employee to use paid sick leave for that absence, and it is not a violation of the law for the employer to give an “occurrence” for such absence. The paid sick leave law provides that an employer shall provide paid sick days for the following purposes:
- (1) Diagnosis, care, or treatment of an existing health condition of, or preventive care for, an employee or an employee’s family member.
- (2) For an employee who is a victim of domestic violence, sexual assault, or stalking, the purposes described in subdivision (c) of Section 230 and subdivision (a) of Section 230.1.
(Lab. Code § 246.5, subd. (a).) An employer is not required to allow an employee to use accrued paid sick days for reasons other than those listed in the statute (as quoted above).
In addition, if an employee has an unscheduled absence that would otherwise result in an “occurrence” under an employer’s attendance policy, and if the employee elects to use accrued paid sick leave for only part of the unscheduled absence (for example, if the employee is absent for a full eight-hour day of work, but elects to use only four hours of his or her accrued paid sick leave for the absence [which the employee is allowed to do], the employer would be allowed to give an “occurrence” (or 1/2 of an “occurrence”) for the one-half day of unscheduled absence for which no paid sick leave was used. Only time that is properly taken as accrued paid sick leave is protected from disciplinary action. The same would be true if the employee had a full eight-hour unscheduled absence, but only had available four hours of accrued paid sick leave. The portion of the unscheduled absence not covered by accrued paid sick leave could be subject to disciplinary action under the employer’s attendance policy.