Question: I run a small business and provide my employees with 3 days of sick leave per year. Someone told me employees might be entitled to more starting next year. Is this true?
Answer: Yes, most likely. The state Senate is currently considering Senate Bill 616, which would amend the Healthy Workplace Healthy Family Act of 2014 (the “HWHFA”) to increase the number of paid sick days for California employees beginning in 2024. The current version of the Senate Bill 616 increases the minimum number of paid sick leave days from three to five days per year. The Governor is expected to sign the final version of this bill into law this Fall. This means that beginning in January 2024, most employers in California will likely need to provide employees with at least five days of paid sick leave per year.
Among other things, the HWHFA provides eligible employees with a minimum amount of paid sick leave to care for themselves and others. Currently, under the HWHFA, eligible employees are entitled to a minimum of three days of paid sick leave per year. An employer can comply with the minimum paid sick leave requirements in one of three ways. The employer can either allow employees to accrue one hour for every thirty hours worked, accrue a minimum of three days of paid sick leave each year, or provide employees with a lump-sum of three days of paid sick leave per year. If an employer elects the accrual method, the employer may limit the use of paid sick leave to three days per year but must allow the employee to carry-over up to six days of paid sick leave from year-to-year.
If Senate Bill 616 is enacted, the annual lump-sum option will increase from three days to five days per year. Three of the five days must be made available to the employee by the completion of the employee’s 120th day of employment, and the remaining two days must be made available to the employee by the completion of the employee’s 200th day of employment. Similarly, the accrual method of three days of paid sick leave each year will be increased to five days of accrued leave per year, with at least three days being accrued by the 120th day of employment and no less than all five days being accrued by the 200th day of employment. The accrual method of one hour for every thirty hours worked would remain the same. Finally, for employers who choose one of the accrual methods, the bill increases the minimum carry-over cap to 10 days of accrued paid sick leave that employees can maintain from year-to-year.
Employers with workers in California should consider whether their current leave policies and communication methods would need to be revised. For example, employers may want to streamline the recordkeeping aspect of employee paid sick leave by providing employees with their annual amount of paid sick leave as an up-front lump sum, rather than having to calculate the accrual of paid sick leave throughout the year. Employers may also want to revisit their accrual caps on paid sick leave. Employers should monitor this bill, and if enacted, contact their labor counsel for guidance on compliance with the new law.