On September 25, 2020, we provided an update regarding AB 1867, which codified Governor Newsom’s executive order creating supplemental paid sick leave for food sector workers for employers with 500 or more employees as Labor Code 248. AB 1867 also created Labor Code 248.1, which established similar though different requirements for non-food sector employers with 500 or more employees.

Q: Do I have to provide notice to my employees regarding their available California Supplemental PSL on their paystubs?

A: It depends. One of the key differences between LC 248 and LC 248.1 is that LC 248.1 creates a notice requirement whereas LC 248 does not.

LC 248 does not require any notice be provided in writing to food sector employees. LC 248 defines food sector workers as a person who is subject to one of the following: Wage Order 3 (Canning, Freezing, and Preserving Industry), Wage Order 8 (Industries Handling Products After Harvest), Wage Order 13 (Industries Preparing Agricultural Products for Market, on the Farm), or Wage Order 14 (Agricultural Occupations). Additionally, food sector workers include any person who works for an employer that operates a food facility, or a person who delivers food from a food facility. 

All other workers are non-food sector workers and are subject to LC 248.1, which requires that all non-food sector California employers who employ at least 500 employees across the United States of America, the District of Columbia, or any U.S. territories in industries not explicitly mentioned above must provide written notice to their employees about the number of available CA Supplemental PSL hours they have available.  More details about the notice are stated below.

  • Eligible Employees: Although section 248.1 covers all persons employed by the hiring entity, CSPSL is only available if an employee “leaves the person’s home or other place of residence to perform work for the person’s hiring entity.” In other words, CSPSL is not available to employees who exclusively work remotely.  The DLSE did not provide any additional guidance on whether requiring an employee to come into the office for paperwork or on some other limited basis qualifies an employee for CSPSL.  However, if an employee must leave their home to perform any work for the employer on September 19, 2020 or later, it is presumable the employee is eligible for CSPSL.  Additionally, the DLSE has advised that, unlike CSPSL for food sector workers, CSPSL for non-food sector workers does not apply to independent contractors.
  • Effective Date: Employers must provide CSPSL to eligible employees as of September 19, 2020. Because California intended the new law to complement the FFCRA, it also is set to expire on December 31, 2020.  However, if the federal government extends the coverage date for the FFCRA, then California’s CSPSL will be extended to the same end date.  Notably, if the law expires while an employee is taking CSPSL, the employee can finish taking the amount of leave they are entitled to receive.
  • Covered Reasons: CSPSL is only available to employees who are:
  1. subject to a federal, state, or local quarantine or isolation order related to COVID-19;
  2. advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19; and/or
  3. prohibited from working by the Company due to health concerns related to the potential transmission of COVID-19.

Therefore, CSPSL is only available in connection with an employee’s own health or exposure.  Unlike the FFCRA or many local supplemental paid sick leave ordinances, CSPSL is not available to employees who must care for children whose schools or childcare close for COVID-19 related reasons.

  • Available Amount of Leave: An employee is entitled to 80 hours of CSPSL if considered “full time” or if the employee worked or was scheduled to work, on average, at least 40 hours per week in the 2 weeks preceding the leave.  Part-time employees with a regular weekly schedule are entitled to CSPSL equal to the total number of hours they are normally scheduled to work over 2 weeks. However, if a part-time employee’s scheduled hours vary, the employee is entitled to 14 times the average number of hours the employee worked each day in the 6 months preceding the leave.  If a part-time employee who works variable hours has worked fewer than 6 months but more than 14 days, the employee is eligible for CSPSL in the amount of 14 times the average number of hours for the same period.  Employees who have worked for 14 days or fewer are entitled to CSPSL equal to the number of hours worked.
  • Rate of Pay: Employers must pay CSPSL at the regular rate of pay for the employee’s last pay period (including any collectively bargained pay rate), or the state or local minimum wage, whichever rate is highest. However, employers are not required to pay more than $511 per day or $5,110 in the aggregate.
  • Offset: The new law allows employers to offset their obligation to provide CSPSL hours with previously provided COVID-19 related supplemental paid sick leave if (1) the leave was provided for the same reasons covered by section 248.1, and (2) the compensation was equal or greater than the amount of CSPSL compensation available. As discussed further below, the lack of uniformity across CSPSL and local supplemental paid sick leave  (“LSPSL”) ordinances may be problematic for some employers.  Additionally, employers may not require employees to use other forms of paid or unpaid leave prior to using CSPSL.
  • No Collective Bargaining Exemption: Employers with unionized employees should note that section 248.1 does not contain a collective bargaining exemption. This represents a departure from California’s paid sick leave under the Healthy Workplace and Healthy Families Act (“HWHFA”) and numerous LSPSL ordinances.  Consequently, any employers who already agreed to separate paid sick leave provisions in collective bargaining agreements, including provisions that exempted the employer from LSPSL ordinances, will need to comply with section 248.1 and also provide employees with CSPSL.
  • Notice Posting Requirement: Section 248.1 requires employers to post the Labor Commissioner Office’s model notice in the workplace so that it is available for all employees to view. Further, the law states that employers should disseminate the notice electronically, e.g., by email, if workers do not frequent the workplace.
  • Wage Statement Requirement: Like the wage statement requirement for California paid sick leave, employers must also provide employees with written notice concerning the amount of CSPSL available on either an itemized wage statement or in a separate writing provided on designated pay dates.  This requirement is effective for the “next full pay period following the date of enactment” of AB 1867. Any employers who utilize a third party payroll provider should communicate with their payroll provider immediately if they have not done so already to ensure the company’s wage statements are compliant with this requirement.  Additionally, section 248.1 incorporates by reference the HWHFA’s recordkeeping requirement for paid sick leave, and therefore requires employers to retain records for at least three years documenting hours worked, the amount of CSPSL provided, and any CSPSL used by an employee.

Potential Issues That Employers May Need to Address

In addition to the requirements outlined above, employers should also review their COVID-19 leave policies and procedures to identify whether any of the following issues are present.

  • Complications With Offsetting: As mentioned above, differences between the covered reasons for COVID-19 related leave, amount of part-time leave available, and calculation of the rate of pay between CSPSL and the various LSPSL ordinances throughout California may be problematic for some employers, especially employers with employees throughout the state.
    • Covered Reasons: CSPSL clearly covers an employee who receives a governmental order or instructions from a health care provider to self-isolate or quarantine. Presumably, employees are also eligible for CSPSL if exposed to a member of the same household who has a confirmed case or exhibits COVID-19 symptoms because the employer will prohibit the employee from coming into work.  However, numerous LSPSL ordinances cover employees who must care for a child whose school or childcare provider is closed.  Because section 248.1 states that an employer may only offset LSPSL as CSPSL if the LSPSL covers the 3 reasons identified above, an employee who already received LSPSL for a school or childcare closure could conceivably receive CSPSL as well.  Further, some employees may try to distinguish previously provided leave as not covered.  Thus, employers should ensure they document internally the reasons that leave was provided previously and going forward.  Additionally, the language in most LSPSL ordinances states that any other supplemental paid leave provided to an employee for the LSPSL’s qualifying reasons offsets the LSPSL.  Therefore, an employee who receives CSPSL first will no longer be eligible for LSPSL under most ordinances.
    • Amount of Leave/Rate of Pay: After determining whether previously provided leave is covered, employers must then assess the leave provided. Employers should compare the amount of leave available for any part-time employees under any applicable LSPSL ordinances.  If the LSPSL ordinance provides for less paid leave than section 248.1, then the employer will need to provide additional CSPSL leave.  Likewise, the rate of pay for LSPSL must be equal to or greater than the amount of leave paid through CSPSL.  If the LSPSL previously paid to the employee was not commensurate with CSPSL, the employer may want to retroactively provide supplemental pay to the employee to satisfy the compensation requirements of section 248.1 so that the employer can then count those hours towards an employees’ CSPSL entitlement.
  • Accurate Wage Statement Compliance: The complications with offsetting also may impact an employer’s compliance with providing employees with an accurate wage statement. Section 248.1 requires employers to provide employees with written notice concerning the amount of CSPSL available on either an itemized wage statement or in a separate writing provided on designated pay dates.  Consequently, employers would be wise to immediately review any previously provided COVID-19 supplemental paid sick leave to ensure that each employee’s wage statement accurately reflects any offset and the current amount of CSPSL available.
  • Requesting Supporting Documentation: The DLSE’s FAQ page instructs that CSPSL must be available immediately upon the employee’s oral or written request and cannot be conditional upon providing a medical certification. The DLSE further advises that while an employer cannot deny CSPSL for lack of certification, it may be reasonable in certain circumstances to ask for documentation before paying CSPSL when the employer has other information that indicates the employee is not requesting sick leave for a valid purpose.  For example, the DLSE states that if an employee is subject to a local quarantine order and the employer subsequently learns that the worker was at a park, a request for documentation would be reasonable.  Thus, employers should review their current policies on requesting documentation from employees in connection with COVID-19 related leave to ensure they comply with the DLSE’s guidance.

Given the continually changing legal landscape, we strongly encourage employers to reach out to Raimondo & Associates with questions regarding specific situations. We are closely monitoring these developments. Because of these frequent developments, and the need to adapt the general guidance below to specific circumstances, employers should consult counsel regarding specific circumstances. There are many nuances and fact-specific elements that make individualized legal counsel on these questions of critical importance.

Raimondo & Associates has developed templates for compliant IIPPs and for additional COVID-19 supplements in order to assist businesses with being in compliance.