California Expands Paid Family Leave

California Governor Jerry Brown recently signed into law Senate Bill 770, which significantly expands California’s Paid Family Leave (“PFL”). Effective July 1, 2014, the new law expands California PFL to include employee time off to care for a seriously ill grandparent, grandchild, sibling, or parent-in-law. Under prior law, PFL was available only to employees who take time off work to care for a seriously ill child, spouse, parent, domestic partner, or to bond with a minor child within one year of birth or placement of the child in connection with foster care or adoption. The new law defines “parent-in-law” to mean “the parent of a spouse or a domestic partner.” “Sibling” means a person related to another person by blood, adoption, or affinity through a common legal or biological parent.”

Employers are reminded that California PFL does not, itself, provide employees with the legal right to take leave covered by PFL. Rather, PFL merely provides a form of wage replacement through California’s unemployment compensation system.

Other laws, such as the Family & Medical Leave Act (“FMLA”) and California Family Rights Act (“CFRA”), do provide certain eligible employees with the right to take leave for new child bonding or to care for a child, parent, spouse, or domestic partner with a serious health condition. FMLA and CFRA do not provide employees with the right to take leave to care for a grandchild, grandparent, parent-in-law, or sibling. Consequently, in most cases, requests for leave to care for the new family members covered by PFL would be considered as requests for discretionary personal leaves.

We expect this new law to result in an increase of employee requests for personal leave. In light of this, we recommend that employers review their personal leave policies in anticipation of such an increase. One option to consider is whether to require employees to use up to two weeks of vacation or PTO in advance of receiving PFL, which the law expressly allows, and which effectively extends the standard one-week waiting period for PFL. This could have the benefit of reducing vacation/PTO balances, and decreasing the amount of time that the employee remains out of work. The law does not allow employers to require use of sick leave prior to receiving PFL (although employers must allow employees to use up to one-half of their accrued sick leave to care for an ill child, parent, spouse, or domestic partner).

Employers are reminded that, when PFL overlaps with FMLA or CFRA, they should not require employees to use accrued vacation, PTO, or sick leave. Mandatory use of such accrued benefits is allowed only when the FMLA/CFRA leave is “otherwise unpaid.” Court rulings have held that leave is not “otherwise unpaid” when the employee receives partial wage replacement from a third party source, such as a governmental wage replacement program.

California law requires employers to provide a California PFL pamphlet (published by the California Employment Development Department) to all new employees, and to employees who may be eligible for PFL. Employers should anticipate the publication of a new, updated pamphlet that they will be required to distribute based upon the changes to PFL.

Employers seeking further guidance on any of these issues may contact any of the firm’s lawyers listed below.

Raymond H. Hixson, Esq. ([email protected]; 408-486-9977)

Brian K. Nagatani, Esq. ([email protected]; 408-486-9988)

Mary Wang, Esq. ([email protected]; 408-486-9933)