September 14, 2020

Last week had significant policy impacts for large employers, as Governor Newsom signed a bill providing additional sick leave benefits and a second bill offering worker protections awaits his signature, and the City passed its own ordinance. More specifically:

AB 1867, a budget trailer bill, was signed that provides supplemental paid sick leave for businesses with over 500 employees nationwide. This bill is designed to mirror the benefits given to workers as provided in the federal Families First Coronavirus Response Act, which applied to companies with less than 500 employees (however did provide certain credits to ease the burden of employer compliance with the law, which the state bill expressly does not).

• The bill requires 80 hours of supplemental paid sick leave to be provided to employees working full time (which is defined by an employee working an average of at least 40 hours per week in the two weeks prior to paid sick leave being received). Part-time employees would also be eligible for the benefit based on a variable determined by the amount of hours they worked in the previous two weeks.
• Paid sick leave is available for:
  • Employees subject to a federal/state/local quarantine order
  • Employees advised by a doctor to self-quarantine or isolate
  • Employees prohibited from working because of transmission concerns.
• Supplemental paid sick leave is capped at $511 per day, and $5,110 total per employee.
• If employers have provided a supplemental benefit equal to or greater than that outlined in AB 1867 before the implementation of the act, the employer is not required to then add another 80 hours of leave.
• AB 1867 was passed under urgency, meaning it will go into effect no less than 10 days after signing (latest would be 9/19/2020). The Department of Labor must issue guidance for compliance and enforcement before going into effect.
  • The bill does not say whether medical documentation is necessary, or allowable, for the employer. It’s likely DOL guidance will determine that.

AB 3216 (Kalra) is pending the Governor’s signature, and would not go into effect until January 1, 2021. This bill outlines worker recall after lay-offs, and retention requirements. It is the statewide version of local ordinances passed in many large cities, including the City of San Diego (outlined below).

• The bill applies to hotels, private clubs, event centers, airport hospitality services, airport service providers, and building service providers.
• Outlines that rehiring after COVID-related lay-offs must be done by order of seniority.
  • Employers can make simultaneous offers, but employees are allowed five days to respond to the offer.
  • Employers must make offers for any job which the laid-off employee is qualified for, not necessarily the job they were laid off from.
• For worker retention, the bill outlines that if a covered employer (outline above) goes out of business, the successor employer must keep the staff on for a minimum of 90 days and must consider making permanent offers. This would be enforced by allowing employees to file complaints with the Department of Labor.

Councilmember Chris Ward offered his own local policy proposals reflecting the two above, in the instance that one or both bills may be vetoed by the Governor. AB 1867 was an urgency bill, so there will be no additional effort on a local supplemental paid sick leave policy. However, AB 3216 has a later effective date, making the Councilmember’s Emergency Recall and Retention Ordinance a sort of “bridge” policy that will go into effect in the time between now and January 2021. The local policy:

• Will require hotels with 200+ rooms or commercial properties with 25+ security/janitorial staff to prioritize the rehiring of laid-off staff based on the amount of time they have worked for the employer.
• Laid-off employees that have been offered to be rehired will have three days to decide if they want to accept the position.
• This ordinance will go into effect immediately and will sunset in 6 months or on December 31, 2020, when the state law (AB 3216) is expected to go into effect.