Seyfarth Synopsis: With the new year right around the corner, California published updated FAQs on the state’s amended Paid Sick Leave Law, which goes into effect January 1, 2024. We’re here to break down the key insights and details of the FAQs so you can start 2024 off on the right foot, including compliance requirements for January 1, coordination with local ordinances, exemption information, and medical documentation guidelines.

Out with the old, and ring in the new! Effective January 1, 2024, California’s amended Paid Sick Leave (“PSL”) law goes into effect. As detailed in our prior update, the amendments increase the annual amount of California paid sick leave from 3 days or 24 hours, to the greater of 5 days or 40 hours for eligible employees. The amendments also raise the accrual and year-end carryover cap from 6 days or 48 hours to the greater of 10 days or 80 hours.

The DIR has now published updated FAQs on the amended law, detailing requirements regarding employees’ annual entitlement to paid sick leave, eligibility criteria, accrual versus frontloading, use of paid sick leave, payment and tracking of earned and taken leave, and information to be provided to employees, which we will break down for our readers.

New Year, New Non-Calendar Benefit Year Compliance Requirements

The FAQs highlight how employers who provide paid sick leave benefits on a benefit year other than the calendar year (i.e., where the year does not start on January 1 and end on December 31) can comply with the impending PSL amendments as of January 1, 2024.

If an employer uses an accrual method, has an annual start date other than January 1, and caps annual usage at 3 days or 24 hours, according to the FAQs, the annual usage cap must increase to the greater of 5 days or 40 hours on January 1. The FAQ No. 15 offers the following example:

If an employer uses the 12-month period of May 1 – April 30 for accrual of paid sick leave with a usage cap of 24 hours or three days, the employer must allow the employee to use an additional 16 hours or two days before April 30 if the employee has accrued that additional leave.

Similarly, if an employer frontloads paid sick leave on an employee’s anniversary date, the FAQs provide that employer can either frontload two additional days on January 1, or move the measurement of the yearly period to January 1, 2024, and frontload the greater of 5 days or 40 hours at the start of 2024. Although not explicitly stated, the same guidance would likely apply for employers who frontload paid sick leave on another date that is not January 1.

Don’t Let The Ball Drop Regarding Local Paid Sick Leave Ordinances

The FAQs highlight that employers must comply with any applicable local ordinances and California’s PSL law. Generally speaking, where there are differences, employers must follow the law that is more generous to employees.

But, the new PSL law does bring some slight cheers for employers, with some limited exceptions where the state law requirements will preempt any different local ordinance provisions on the same subject, including:

  1. The lending of paid sick leave;
  2. Paystub statements;
  3. Calculation of paid sick leave;
  4. Providing notice of the leave if it is foreseeable;
  5. Timing of payment of paid sick leave; and
  6. Whether payment of sick leave is required upon termination.

While some local jurisdictions put their own special spin on paid sick leave requirements, none of these ordinances currently conflict with California’s PSL requirements on these six specific points. However, there are local PSL laws that include more generous sick leave provisions that are not preempted by the state PSL law, which employers would need to continue to comply with in the new year. 

For example, West Hollywood employees and hotel workers in the City of Los Angeles are eligible to receive up to 96 hours of compensated leave (inclusive of vacation and sick leave) each year, with a maximum cap of 192 hours. The first 24 hours allocated for sick leave purposes accrues at a rate of 96/52 hours per week rather than the 1 hour for every 30 hours worked state accrual rate. Check in with your favorite Seyfarth counselor for other oddities to keep on the radar!      

Limited Exemptions Stick Around Past The Stroke Of Midnight

California’s PSL requirements exempt individuals employed in specific industries including: (1) by an air carrier as a flight deck or cabin crew member, if they receive compensated time off at least as generous as the California PSL requirements; (2) retired annuitants working for government entities; (3) railroad employees; and (4) construction employees covered by a CBA with specific provisions.

As we previously wrote, certain CBA-covered employees outside of the construction industry can also be partially exempt from the state’s PSL requirements—if they are covered by a CBA with specific detailed provisions (detailed at new Labor Code section 245.5(a)(1)). But, this is a partial exemption only—these employees are still entitled to some PSL under their CBA. The updated FAQs note that as of January 1, 2024, CBA-covered employees must be allowed to take PSL for all the reasons covered in the California PSL law, they cannot be required to find a replacement worker as a condition for taking PSL, and they cannot be retaliated against for taking PSL (including likely not being disciplined for the absence), among other things.

For Auld Lang Syne, Employers Still Can’t Require Medical Documentation

As with the prior iteration of California’s PSL law, the amended law is silent on employers’ ability to require documentation for use of paid sick leave.

But, the FAQs confirm that employees can take PSL immediately upon oral or written request, and may not be denied the sick leave due to a lack of medical documentation. The FAQs note that it may be reasonable for an employer to ask for documentation before paying sick leave only if it has reason to believe the employee’s sick leave request is for an invalid purpose.

Make A Resolution To Update Your Model Poster And Wage Theft Notice

Last but not least, as we previously detailed, in addition to the FAQs, the Labor Commissioner has updated California’s paid sick leave poster and wage theft notice to comply with the amended law. Don’t forget to role these updates out on January 1! (And remember to check out our post regarding other updates to the Wage Theft Notice.)

Workplace Solutions

As the California Paid Sick Leave law amendments’ January 1, 2024, effective date is mere days away, here are some next steps for your business to consider:

  • Review existing sick leave or PTO policies and practices, including those in a California locality with a separate local paid sick leave mandate, and either implement new policies and practices or revise existing policies and practices to ensure compliance with the amendments, while doing the same for any related attendance, conduct, anti-retaliation, and discipline policies and practices.
  • Train supervisory and managerial employees, as well as HR, on the new requirements.
  • Update onboarding packets for non-exempt workers with an updated Wage Theft Prevention Act Notice reflecting the changes to CA law, if needed.

Seyfarth is here to help employers with solutions and recommendations to comply with California and nationwide paid leave requirements. Check out the CalPeculiarities Blog for updates on other laws affecting California employers.

Edited by Coby Turner