Employment Law Alert: New San Diego & Los Angeles Sick Leave/Minimum Wage Laws
June 28, 2016
The Cities of San Diego and Los Angeles recently enacted local sick leave and minimum wage laws. Employers with employees working in those cities should take action immediately to update their policies and practices to ensure compliance. As to differences between local city, California, and federal laws, employers are required to comply with the provisions that are most generous to the employees.
We summarize below the coverage parameters of the San Diego sick leave law, and key requirements that are stricter than California state law:
- Compliance Deadline: The City of San Diego has advised that the law will take effect on the day the City Council approves a resolution certifying the election results. This is expected to occur on July 11 or 18.
- Covered Employees: Employees who work at least two hours in a week within the City of San Diego. Unlike California state law, there is no requirement that an employee work for the same employer for 30 days within a year from commencement of employment. There are some narrow exceptions to employee coverage (e.g., student employees, camp counselors), but no special exception for employees covered by a collective bargaining agreement. The San Diego law seems unclear as to whether it applies only to non-exempt employees, or to both exempt and non-exempt employees. The law’s definition of “employee” includes a requirement that the employee “[q]ualifies as an employee entitled to payment of a minimum wage” under California law (suggesting non-exempt status). However, the sick leave portion of the law specifies that “Employees who are not covered by overtime requirements” (i.e., suggesting exempt status) “are assumed to work forty hours in each work week for purposes of Earned Sick Leave accrual unless their regular work week is less than forty hours, in which case Earned Sick Leave accrues based upon that regular work week” (suggesting that exempt employees are entitled to accrual). The City of San Diego has published FAQs taking the position that the law covers both exempt and non-exempt employees.
- Lump Sum Method: San Diego does not authorize employers to provide a yearly lump sum allotment of sick leave in lieu of the mandatory accrual standard of 1 hour of sick leave per 30 hours of work. The City of San Diego’s FAQs indicate that a future implementing ordnance may clarify methods that may be used to satisfy the law.
- Accrual Cap: San Diego law does not allow an employer to set a maximum cap on sick leave accrual. The City of San Diego’s FAQs indicate a future implementing ordinance may adopt an accrual cap.
- Usage Purposes: In addition to qualifying reasons under state law, San Diego requires employers to allows sick leave use when the employee’s place of business is closed by order of a public official due to a public health emergency, or the employee is providing care or assistance to a child, whose school or child care provider is closed by order of a public official due to a public health emergency.
- Family Member: In addition to using sick leave to care for a family member as defined under state law, a San Diego employee may use sick leave to care for a step-sibling.
- Usage Cap: San Diego law allows employers to establish an annual usage cap of 40 hours per year, whereas state law permits a usage cap of 3 days or 24 hours per year.
- Notice & Posting: The law requires employers to post an annual notice published by the City of San Diego regarding sick leave and minimum wage rights. Also, the law requires employers to provide each employee at the time of hire or the effective date of the law (whichever is later) a written notice including the employer’s name, address, and telephone number and the employer’s requirements under the law. Translation is required into languages spoken by at least five percent of the employees at a job site.
When the ordinance takes effect (anticipated July 11 or 18, 2016), the minimum hourly wage in San Diego will be $10.50. It will increase to $11.50 on January 1, 2017, and starting January 1, 2019, will be adjusted annually based upon cost of living.
We summarize below the coverage parameters of the Los Angeles sick leave law, and key requirements that are stricter than California state law:
- Compliance Deadline:
- Employers with 26 or more employees: July 1, 2016
- Employers with 25 or fewer employees: July 1, 2017
- Covered Employees: Employees non-exempt from California minimum wage requirements who work at least two hours in a week within the City of Los Angeles. As a further condition to eligibility, on or after July 1, 2016, the employee must work in the City of Los Angeles for the same employer for 30 days or more within a year from the commencement of employment. There is no special exception for employees covered by a collective bargaining agreement.
- Lump Sum Method: If an employer chooses to provide a lump sum of sick leave at the beginning of each year (instead of accrual at the rate of 1 hour of sick leave per 30 hours of work), it must provide a lump sum of at least 48 hours. The California state standard is 3 days or 24 hours.
- Accrual Cap: Los Angeles allows employers to set a maximum accrual cap of no less than 72 hours, whereas the state law specifies 6 days or 48 hours.
- Family Member: In addition to using sick leave to care for a family member as defined under state law, a Los Angeles employee may use sick leave to care for “any individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship.”
- Usage Cap: Los Angeles law allows employers to establish an annual usage cap of 48 hours per year of employment, calendar year, or 12-month period (whereas state law permits an annual usage cap of 3 days or 24 hours).
Employers with 26 or more employees must pay the following minimum hourly wages to employees working in Los Angeles: $10.50 (effective July 1, 2016), $12.00 (July 1, 2017), $13.25 (July 1, 2018), $14.25 (July 1, 2019), and $15.00 (July 1, 2020). For employers with 25 or fewer employees, each of the above minimum wage effective dates is postponed one year. Starting July 1, 2022, the Los Angeles minimum wage will be adjusted annually based upon the consumer price index.