COVID-19: California Implements New COVID-19 Sick Leave Benefits Retroactive to January 1, 2021 For Employers With 26 Or More Employees

COVID-19: California Implements New COVID-19 Sick Leave Benefits Retroactive to January 1, 2021 For Employers With 26 Or More Employees
Posted March 23, 2021

With Governor Newsom’s signing of California Senate Bill 95 (SB 95) on March 19, 2021, California has significantly expanded employers’ obligations to provide supplemental paid sick leave to employees impacted by COVID-19 in 2021.

Retroactive to January 1, 2021, SB 95 requires all employers with 26 or more employees to provide 80 additional hours of COVID-19-related supplemental paid sick leave in 2021. SB 95 also expands the list of qualifying reasons for the use of paid sick leave, and requires employers to provide this paid leave through September 30, 2021.

Notably, this is not an extension of the sick leave benefits enacted through California’s Supplemental Paid Sick Leave law (“CSPSL”) in September 2020. Rather, SB 95 is a new law requiring an entirely new bank of 80 hours (prorated for part-time and variable hour employees) of paid sick leave benefits in 2021.

When does SB 95 take effect?

SB 95 creates California Labor Code Sections 248.2 and 248.3. It is set to become effective “not later than 10 days after the date of enactment,” which will be Monday, March 29, 2021. Again, once effective, the benefits provided by SB 95 are retroactive to January 1, 2021.

Do I have to post a notice?

Yes. The California Labor Commission is required to publish a model notice by April 5, 2021. Employers must post the notice in the workplace, and may provide it electronically or by mail to remote workers.

When do SB 95 sick leave benefits end?

SB 95 benefits will end on September 30, 2021, unless the program is extended. However, any employee already using SB 95 benefits on the day the law expires will be entitled to continue using the full amount of SB 95 benefits available to them for that ongoing absence.

Who is a “covered employer” under SB 95?

Under SB 95, all employers with 26 or more employees must provide paid sick leave for COVID-19 related reasons. This is an expansion in covered employers because the 2020 CSPSL applied only to companies with 500 or more employees and food sector workers.

Who is a “covered employee” under SB 95?

A covered employee under SB 95 is any employee who “is unable to work or telework” for any one of the qualifying uses listed by the statute.

What are the qualifying uses for emergency paid sick leave under SB 95?

A covered employee may use the 80 hours of emergency paid sick leave under SB 95 for any of the following COVID-19-related uses:

The covered employee “is subject to a quarantine or isolation period related to COVID-19” as defined by an order or guidelines of the California Department of Public Health, the CDC, or a local health officer who has jurisdiction over the workplace.
The covered employee “has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.”
The covered employee “is attending an appointment to receive a vaccine for protection against contracting COVID-19.”
The covered employee “is experiencing symptoms related to a COVID-19 vaccine that prevent the employee from being able to work or telework.”
The covered employee “is experiencing symptoms of COVID-19 and seeking a medical diagnosis.”
The covered employee is caring for a family member who is subject to a quarantine order or isolation period or who has been advised to self-quarantine by a health care provider.
The covered employee is caring for a child “whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19.”

Note that the previous CSPSL benefit for larger employers in California did not allow employees to use paid sick leave for many of these reasons, including to care for a family member. Under SB 95, “family member” includes a child, grandchild, grandparent, parent, sibling, or spouse. The previously-available sick leave benefits also did not cover vaccination appointments, which are now a qualifying reason for sick leave under SB 95.

The requirement that employers provide paid sick leave benefits to employees who are unable to “telework” is also new. This means that home-based remote workers with a qualifying reason are entitled to use SB 95 benefits if they are unable to telework.

In addition, if an employee is subject to more than one isolation or quarantine period recommended by different agencies, SB 95 requires that the employee be permitted to use paid sick leave benefits under the order or guidelines that provide for the longest minimum period. However, the total paid sick leave under SB 95 would not exceed 80 hours.

How much emergency paid sick leave is available under SB 95?

Full-time employees are entitled to 80 hours of emergency paid sick leave if they are considered by the employer to be “full time” or if they worked at least 40 hours per week on average in the preceding two weeks.

Part-time workers receive paid sick leave based upon the number of hours they typically work in a two-week period. For part-time workers with variable schedules, the employer is required to pay an average of the daily hours worked by the employee, with different calculations based on the employee’s tenure.

As with CSPSL, the COVID-19-related paid sick leave benefits required under SB 95 are in addition to sick time benefits required under existing law (including California-mandated sick leave and voluntary company-sponsored sick leave).

Employers cannot require that employees use their normal sick leave or other paid time off benefits instead of or before using SB 95 sick leave benefits. It is the employee, not the employer, who decides the amount of SB 95 sick leave benefits the employee will use (up to the maximum limits noted above).

How are SB 95 sick leave benefits calculated?

A covered non-exempt employee is paid at the highest of (A) the regular rate of pay as calculated for the workweek in which the covered employee uses SB 95 sick leave; (B) the regular rate of pay as calculated by dividing the covered employee’s total wages (excluding overtime premium pay) by the total hours worked in the full pay periods of the prior 90 days of employment; (C) the state minimum wage; or (D) the local minimum wage applicable to the employee.

A covered exempt employee’s SB 95 benefits must be calculated in the same manner as other paid leave time provided by the employer. As with the federal Families First Coronavirus Response Act ("FFCRA") and CSPSL, the benefit is capped at $511 per day and $5,100 in the aggregate.

Must SB 95 benefits be included on wage statements?

Yes. A covered employer must list the amount of an employee’s available SB 95 paid sick leave benefits on the employee’s wage statement as a separate line item. The SB 95 sick leave must be listed separately from other available paid sick leave or paid time off benefits. This wage statement requirement becomes effective on the next full pay period after the date that this law takes effect.

May an employer apply an employee’s SB 95 paid sick leave benefits to the employee’s compensation during a mandatory quarantine for a work-related exposure or positive case under the Cal-OSHA COVID-19 Emergency Temporary Standards (ETS)?

Yes. When an employee has been excluded from the workplace for a work-related COVID-19 exposure or positive case under Cal-OSHA’s COVID-19 ETS standards, the employer may first exhaust any available SB 95 sick leave in order to maintain the employee’s earnings.

Is an employer required to pay all sick leave required by SB 95 if the requesting employee has already exhausted the 80 hours of emergency paid sick leave granted under the FFCRA and/or CSPSL, or paid sick leave required by a local jurisdiction?

This depends upon whether the prior COVID-19 sick leave was paid to the employee in 2020 or 2021.

For paid sick leave hours granted to the employee under the FFCRA, CSPSL or any local ordinance before January 1, 2021, the employer may not credit any of those hours against the 80 hours of paid sick leave mandated by SB 95. For example, if an employee used 80 hours of FFCRA emergency paid sick leave in 2020, the employer will owe an additional 80 hours of emergency paid sick leave under SB 95 to that same employee.

For COVID-related paid sick leave provided after January 1, 2021, under the FFCRA, CSPSL or any local ordinance, the employer may credit the employee with those paid sick time hours and reduce the employee’s SB 95 paid sick leave allotment proportionally. For example, if a full-time employee already used eight hours of emergency paid sick leave under the FFCRA in the calendar year 2021, the employer will owe 72 additional hours of emergency paid sick leave under SB 95 to that employee.

Note that for the offset/credit to occur, the employee must have used the paid sick leave for a qualifying reason under SB 95, and must have been compensated in an amount equal to or greater than the amount required by SB 95.

How should employers handle situations in which an employee requested sick leave on or after January 1, 2021 and was denied compensation for that sick leave?

SB 95 is retroactive to January 1, 2021, which means that employees can choose to use their SB 95 sick pay for any qualifying use on or after January 1, 2021.

If an employee took unpaid time off for a qualifying reason on or after January 1, 2021, the employee may request retroactive sick pay under SB 95. Upon the employee's written or oral request, the employer must issue a retroactive payment to an employee who previously took unpaid time off for a qualifying reason. The amount of hours retroactively paid would reduce the employee’s 80-hour allotment of SB 95 benefits accordingly.

Employers must make this retroactive payment on or before the payday for the next full pay period after the employee makes the request. The employee’s wage statement also must reflect the retroactive payment of these benefits.

Are there different rules for different types of employees?

Yes. A covered firefighter scheduled to work more than 80 hours in the two weeks preceding the use of SB 95 benefits is entitled to an increased allotment of SB 95 sick pay benefits in the (higher) amount of hours they were scheduled to work. In addition, in-home supportive services and/or personal care services providers under the Welfare and Institutions Code are entitled to SB 95 benefits in addition to any unused emergency paid sick leave benefits provided by the FFCRA, which can still be used through September 30, 2021. This means that employers of these employees cannot offset paid sick leave under the FFCRA against SB 95 benefits.

Will the California Labor Commission enforce SB 95?

Yes. SB 95 requires the Labor Commissioner to enforce SB 95 in the same manner that it enforces “paid sick days,” “paid sick leave,” or “sick leave” under existing law.

For more information, the bill language for SB 95 can be accessed here.

For further information regarding COVID-19 questions, or other employment law issues, contact the attorneys at LightGabler.