California’s Newest Employment Law: Mandatory Paid Sick Leave for all Workers

California’s Newest Employment Law: Mandatory Paid Sick Leave for all Workers

Big news came out of Sacramento yesterday as California Governor Jerry Brown signed Assembly Bill 1522 into law. AB 1522, also known as the Healthy Workplaces, Healthy Families Act of 2014, requires all California-based employers to provide employees with up to three days of paid sick leave per year, beginning on July 1, 2015.

The Law

Under the new law, aside for a few limited exceptions, all employees working in California will earn a minimum of one hour of paid sick leave for every 30 hours worked.  Governor Brown’s office estimates that the new law will provide sick benefits to about 6.5 million employees, or 40 percent of California’s workforce, who do not currently receive paid sick leave.

The new law also requires that once the hours are accrued, up to 24 hours (or three days) of paid sick leave per year, they can carry over to the next calendar year. Employers are allowed to limit, or “cap,” the total accrual of paid sick leave to six days (48 hours).

The law in this regard is not dissimilar to vacation accrual caps that are permitted under existing California law. That is, if an employee reaches their 48 hour paid sick time cap and has not used any of it, they will stop accruing additional hours until they used some of the accrued time. Employers, at their discretion, may set a higher maximum limit to the amount of hours that may be accrued.

It should be noted that an employer is not required to provide any additional paid sick time to its employees if its existing policy already meets the law’s minimum requirements.

The Reaction

As would be expected, the reaction to the new law is split. Governor Brown’s office issued the following statement:

“Whether you’re a dishwasher in San Diego or a store clerk in Oakland, this bill frees you of having to choose between your family’s health and your job. Make no mistake, California is putting its workers first.”

And House Democratic Leader Nancy Pelosi had this to say:

“Paid sick leave is essential for the health of our families, the strength of our workers, and the success of the middle class. California’s Healthy Workplaces, Healthy Families Act will help lower health care costs, reduce employee turnover, prevent the spread of illnesses, and support both women and men caring for their families. In order to jumpstart the middle class, Congress must now follow California’s lead and guarantee paid sick leave for workers across the entire country.”

On the other side of the aisle, conservative business advocates argue that the new law will add more financial strain on already burdened employers and will damage the state’s business climate.

John Kabateck, the executive director of the National Federation of Independent Business in California stated:

“Our small business owners, who make up more than 99 percent of the employer community in California, already face an increase in minimum wage, among the highest taxes and more regulations than any other state.”

If you have any questions about this newest California employment law, CPEhr is available to provide assistance and guidance in creating a compliant paid sick benefits policy.

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