New Bill Requires California Employers to Provide Paid Sick Days

With the recent close of the 2014 legislative session, Sacramento has been in a flurry with the passage and signing of new state laws, which are set to be enacted in the coming new year. One bill that has garnered significant press is the Healthy Workplaces, Healthy Families Act of 2014 (AB 1522), signed into law by Governor Jerry Brown on September 10, 2014. AB 1522 will require California employers to provide paid sick leave to their employees starting on July 1, 2015.

Currently, it is estimated that 40% of the state’s workforce do not earn sick leave benefits through employer-sponsored benefit programs. This means that approximately 6.5 million workers in California cannot take a paid day off when they are ill or when a family member is sick. The signing and enactment of AB 1522 positions California as the second state in the nation to pass such a law after Connecticut approved a similar measure in 2011.

Under California’s new law, employers will be required to provide 3 days or 24 hours of paid sick leave to employees who work 30 or more days within a year from commencement of employment, accruing at a minimum of one hour of paid sick leave for every 30 hours worked. An employee would be entitled to begin using their accrued time after 90 days of employment. Additionally, not only will employees be able to use this time off for their own illnesses, but they also will be allowed to use this time to care for a sick family member. It is important to note that if a business already has an existing paid leave or paid time off policy, it is not required to provide additional paid sick days under the new law.

For businesses within the state, the enactment of this law could mean additional labor costs and the reduction of schedule flexibility for industries that need it the most. Should an employer withhold paid sick leave from an employee or not comply with the bill’s requirements, penalties of up to $4,000 per day can be imposed. To avoid these penalties, businesses are required to:

• Provide written notice to employees on their pay stubs with the amount of paid sick leave available to them.
• Post informational posters related to the new legislation in the workplace.
• Retain records related to an employee’s paid and accrued sick days for a minimum of three years.

While the new law will be welcomed and supported by many, there are numerous ramifications that businesses in California need to be aware of before the law goes into effect next year to minimize its initial burden.

Should you have any questions or concerns about the Healthy Workplaces, Healthy Families Act of 2014 and how it will affect your business, feel free to contact your BPW advisor at (805) 963-7811.