California’s latest move on the COVID-19 front is an attempt to fill the gap left by the federal Families First Coronavirus Response Act (FFCRA) – and requires larger employers to act immediately. The FFCRA – which mandates paid sick and FMLA leave for designated COVID-19 reasons – does not apply to employers with 500 or more employees. The FFCRA also allows employers of certain health care workers and emergency responders to exclude those employees from its coverage.

On September 10, 2020, Governor Newsom closed these FFCRA loopholes for California-based employees by signing A.B. 1867 into law. The new statute takes effect immediately, and by September 20, 2020, requires employers to provide up to 80 hours of “COVID-19 supplemental paid sick leave” to the following “covered workers”:

  • California-based employees of larger employers (500 or more employees in the U.S.);
  • Specified “food sector workers” (A.B. 1867 effectively codifies Governor’s Newsom’s existing Executive Order already granting paid COVID-19 paid sick leave to these workers); and
  • Health care workers and emergency responders who were excluded from FFCRA by their employers.

A.B. 1867 does two other things:

  • It requires employers to allow employees who work in food facilities, as defined in Section 113789 of the Health and Safety Code, to wash their hands every 30 minutes and additionally as needed, and
  • It creates a new mediation pilot program under which small employers (5 to 19 employees) may request mediation through the Department of Fair Employment and Housing (DFEH) within 30 days of receiving a right to sue notice for alleged violations of the California Family Rights Act (CFRA), the state law equivalent of the FMLA.

Interestingly, nothing in A.B. 1867 expressly limits the new COVID-19 sick leave benefit to California-based employees, but California’s ability to regulate employment relationships generally stops at its borders.

A.B. 1867’s requirements are detailed below.

New COVID-19 supplemental paid sick leave requirements

A.B. 1867 adds a new section to the California Labor Code (Section 248.1) requiring COVID-19 supplemental paid sick leave for employees who work for their employers outside of their homes or places of residence and who are employed either:

  • By a “hiring entity,” which means a private sole proprietorship, a private entity of any kind, or any other business enterprise that has 500 or more employees in the United States; or
  • As a health care provider or emergency responder, as defined under Section 826.30(c) of Title 29 of the Code of Federal Regulations, by a hiring entity that has elected to exclude such employees from emergency paid sick leave under the FFCRA.

However, different paid sick leave rules apply to “food sector workers,” as defined and discussed below.

Determining the number of employees

A.B. 1867 incorporates the FFCRA’s test for determining how many employees a hiring entity has in the U.S. Both full and part time employees count towards the 500 employee limit if they work in any state within the U.S., the District of Columbia, or any U.S. territory or possession. New hires, day laborers, employees on leave, and jointly employed employees of temporary placement agencies all count towards the total. And the FLSA joint employer test and the FMLA integrated employer test apply as well when different entities are involved.

Qualifying reasons for leave

Covered employees are entitled to COVID-19 supplemental paid sick leave if they are unable to work due to any of the following reasons:

  • The covered worker is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
  • The covered worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19.
  • The covered worker is prohibited from working by the covered worker’s hiring entity due to health concerns related to the potential transmission of COVID-19.
Amount of leave available

Covered employees are entitled to 80 hours of COVID-19 supplemental paid sick leave if they are classified as “full time” employees or are scheduled to work, on average, at least 40 hours per week for the hiring entity in the two weeks preceding the date the covered employees take COVID-19 supplemental paid sick leave.

Covered workers who are active firefighters are entitled to more paid sick leave if they were scheduled to work more than 80 hours for the hiring entity in the two weeks preceding the date they take COVID-19 supplemental paid sick leave. In such cases, the firefighters are entitled to an amount of COVID-19 supplemental paid sick leave equal to the total number of hours that they were scheduled to work in the two preceding weeks, but only if they work for fire departments specified in the new law.

Covered employees who are not full time / scheduled to work at least 40 hours a week are entitled to lesser amounts of COVID-19 supplemental paid sick leave:

  • If the covered worker has a normal weekly schedule, the total number of hours the covered worker is normally scheduled to work for the hiring entity over two weeks.
  • If the covered worker works a variable number of hours, 14 times the average number of hours the covered worker worked each day for the hiring entity in the six months preceding the date the covered worker took COVID-19 supplemental paid sick leave. If the covered worker has worked for the hiring entity over a period of fewer than six months but more than 14 days, this calculation must instead be made over the entire period the covered worker has worked for the hiring entity.
  • If the covered worker works a variable number of hours and has worked for the hiring entity over a period of 14 days or fewer, the total number of hours the covered worker has worked for that hiring entity.

COVID-19 supplemental paid sick leave is required in addition to any paid sick leave that may be available to the covered worker under California’s existing paid sick leave law (Labor Code section 246).

Covered employees unilaterally determine how many hours of COVID-19 supplemental paid sick leave they need to use, up to the hours cap imposed by the law. Employers must make COVID-19 supplemental paid sick leave available for immediate use, upon either an oral or written employee request.

Applicable pay rate / Maximum benefit amount

Each hour of COVID-19 supplemental paid sick leave must be paid at a rate equal to the highest of the following:

  • The covered worker’s regular rate of pay for the covered worker’s last pay period, including pursuant to any collective bargaining agreement that applies.
  • The state minimum wage.
  • The local minimum wage to which the covered worker is entitled.

However, COVID-19 supplemental paid sick leave is capped at five hundred eleven dollars ($511) per day and five thousand one hundred ten dollars ($5,110) in the aggregate.

Credit for existing leave benefits

Employers may not require employees to use any other paid or unpaid leave, paid time off, or vacation time before the employee uses COVID-19 supplemental paid sick leave, or in lieu of such supplemental paid sick leave. But if employers already offer supplemental paid leave (other than paid sick leave under Labor Code section 246) that may be used for the reasons listed above, and at a rate of pay equal to or greater than the amount required for COVID-19 supplemental paid sick leave, the employers may count the hours of the other paid benefit or leave towards the total number of hours of required COVID-19 supplemental paid sick leave. Supplemental paid leave provided pursuant to federal or local law for the same reasons may also be counted.

Short deadline to include COVID-19 supplemental paid sick leave hours on pay stubs

As with existing paid sick leave, an employee’s wage statement or paystub must list the employee’s accrued hours of COVID-19 supplemental paid sick leave. However, A.B. 1867 imposes a very short deadline for employers to add this information to paystubs. The employee’s paystub or a separate writing provided to the employee on the payday must reflect the employee’s available hours balance by the “next full pay period following” September 10, 2020. Instituting this change to employee paystubs in the short time frame allowed will not be easy.

Required notice to employees

The new law gives the Labor Commissioner seven days to make publicly available a model notice explaining the new law and its leave entitlements, which employers must post in their workplaces. Employers also may disseminate the required notice by electronic means such as email if their employees “do not frequent a workplace.”

Enforcement

The Labor Commissioner is authorized to enforce the mandates of A.B. 1867, but there does not appear to be a private right of action for employees under the statute. However, employees may be able to assert PAGA claims for violations of the new law.

The Labor Commissioner may enforce A.B. 1867 provisions as if COVID-19 supplemental paid sick leave constitutes “paid sick days,” “paid sick leave,” or “sick leave” under the existing provisions of the Labor Code.

Effective dates of the new law

A.B. 1867 is effective immediately, but requires covered employers to provide COVID-19 supplemental paid sick leave within 10 days of enactment (i.e., by September 20, 2020).

The obligation to provide COVID-19 supplemental paid sick leave expires on the later of December 31, 2020 or the expiration of any federal extension of the Emergency Paid Sick Leave Act established by the FFCRA. Employees taking COVID-19 supplemental paid sick leave at the time of the expiration of the new law must be permitted to take the full amount of COVID-19 supplemental paid sick leave to which the employees otherwise would have been entitled under A.B. 1867.

COVID-19 food sector supplemental paid sick leave requirements

A.B. 1867 also codifies Governor Newsom’s executive order requiring paid sick leave for food sector employees. Employers now must offer “COVID-19 food sector supplemental paid sick leave” to “food sector workers” who work outside of their homes or places of residence in one or more of the following industries or occupations:

(i) The “Canning, Freezing, and Preserving Industry” – any industry, business, or establishment operated for the purpose of canning soups, or of cooking, canning, curing, freezing, pickling, salting, bottling, preserving, or otherwise processing any fruits or vegetables, seafood, meat, poultry or rabbit product, when the purpose of such processing is the preservation of the product and includes all operations incidental thereto; or

(ii) “Industries Handling Products After Harvest” – any industry, business, or establishment operated for the purpose of grading, sorting, cleaning, drying, cooling, icing, packing, dehydrating, cracking, shelling, candling, separating, slaughtering, picking, plucking, shucking, pasteurizing, fermenting, ripening, molding, or otherwise preparing any agricultural, horticultural, egg, poultry, meat, seafood, rabbit, or dairy product for distribution, and includes all the operations incidental thereto; or

(iii) “Industries Preparing Agricultural Products for Market, on the Farm” – any operation performed in a permanently fixed structure or establishment on the farm or on a moving packing plant on the farm for the purpose of preparing agricultural, horticultural, egg, poultry, meat, seafood, rabbit, or dairy products for market when such operations are done on the premises owned or operated by the same employer who produced the products referred to herein and includes all operations incidental thereto; or

(iv) “Employed in an agricultural occupation” – any of the following described occupations: (1) The preparation, care, and treatment of farm land, pipeline, or ditches, including leveling for agricultural purposes, plowing, discing, and fertilizing the soil; (2) The sowing and planting of any agricultural or horticultural commodity; (3) The care of any agricultural or horticultural commodity; as used in this subdivision, “care” includes but is not limited to, cultivation, irrigation, weed control, thinning, heating, pruning, or tying, fumigating, spraying, and dusting; (4) The harvesting of any agricultural or horticultural commodity, including but not limited to, picking, cutting, threshing, mowing, knocking off, field chopping, bunching, baling, balling, field packing, and placing in field containers or in the vehicle in which the commodity will be hauled, and transportation on the farm or to a place of first processing or distribution; (5) The assembly and storage of any agricultural or horticultural commodity, including but not limited to, loading, road siding, banking, stacking, binding, and piling; (6) The raising, feeding and management of livestock, fur bearing animals, poultry, fish, mollusks, and insects, including but not limited to herding, housing, hatching, milking, shearing, handling eggs, and extracting honey; (7) The harvesting of fish, as defined by Section 45 of the Fish and Game Code, for commercial sale; (8) The conservation, improvement or maintenance of such farm and its tools and equipment; or

(v) For a hiring entity that operates a food facility, as defined in Section 113789 of the Health and Safety Code; or

(vi) Delivering food from a food facility, as defined in Section 113789 of the Health and Safety Code, for or through a hiring entity.

Food sector employees’ qualifying reasons for leave

Food sector workers are entitled to COVID-19 food sector supplemental paid sick leave if the workers are unable to work for any of the following reasons:

  • The food sector worker is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
  • The food sector worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19.
  • The food sector worker is prohibited from working by the food sector worker’s hiring entity due to health concerns related to the potential transmission of COVID-19.
Amount of leave available to food sector employees

Food sector workers are entitled to 80 hours of COVID-19 food sector supplemental paid sick leave if they are “full time” employees of the hiring entity or they are scheduled to work, on average, at least 40 hours per week for the hiring entity in the two weeks preceding the date the food sector worker takes COVID-19 food sector supplemental paid sick leave.

Food sector workers who do not satisfy the full time or 40 hours per week requirements are entitled to a lesser amount of COVID-19 food sector supplemental paid sick leave:

  • If the food sector worker has a normal weekly schedule, the total number of hours the food sector worker is normally scheduled to work for or through a hiring entity over two weeks.
  • If the food sector worker works a variable number of hours, 14 times the average number of hours the food sector worker worked each day for or through the hiring entity in the six months preceding the date the food sector worker took COVID-19 food sector supplemental paid sick leave. If the food sector worker has worked for the hiring entity fewer than six months, this calculation shall instead be made over the entire period the food sector worker has worked for the hiring entity.

COVID-19 food sector supplemental paid sick leave is in addition to any paid sick leave that may be available to the food sector worker under California’s existing paid sick leave law (Labor Code Section 246), but is not in addition to the total number of hours of supplemental paid sick leave available to the worker under Governor Newsom’s existing food sector executive order (Executive Order N-51-20).

The food sector worker is allowed to determine how many hours of COVID-19 food sector supplemental paid sick leave to use, up to the total number of hours to which the food sector worker is entitled pursuant the new law, and the hiring entity must make COVID-19 food sector supplemental paid sick leave available for immediate use upon oral or written request.

Food sector workers’ applicable pay rate / Maximum pay cap

COVID-19 food sector supplemental paid sick leave must be paid at a rate equal to the highest of the following:

  • The food sector worker’s regular rate of pay for the food sector worker’s last pay period.
  • The state minimum wage.
  • The local minimum wage to which the food sector worker is entitled.

However, like the new COVID-19 supplemental paid sick leave, COVID-19 food sector supplemental paid sick leave is capped at five hundred eleven dollars ($511) per day and five thousand one hundred ten dollars ($5,110) in the aggregate.

Credit for other paid leave benefits

The hiring entity cannot require food sector workers to use any other paid or unpaid leave, paid time off, or vacation time provided by the hiring entity before, or in lieu of, COVID-19 food sector supplemental paid sick leave.

However, as with the new COVID-19 supplemental paid sick leave, employers who already offer supplemental paid leave (other than paid sick leave under Labor Code section 246) that may be used for the reasons listed above, and at a rate of pay equal to or greater than the amount required for COVID-19 food sector supplemental paid sick leave, may count the hours of the other paid benefit or leave towards the total number of hours of required COVID-19 food sector supplemental paid sick leave.

COVID-19 food sector supplemental paid sick leave retroactive application and expiration

The requirement to provide COVID-19 food sector supplemental paid sick leave applies retroactively to April 16, 2020, and shall expire on December 31, 2020 or upon the expiration of any federal extension of the Emergency Paid Sick Leave Act established by the FFCRA, whichever is later.

Family Leave Pilot Mediation Program

A.B. 1867 instructs the DFEH to create a small employer family leave mediation pilot program for employers with between 5 and 19 employees. Under the pilot program, an employer may, within 30 days of receipt of a right-to-sue notice alleging a violation of the CFRA, or the employee may, within 30 days of obtaining a right-to-sue notice alleging a CFRA violation, request that all parties participate in a DFEH mediation.

DFEH right-to-sue notices shall include a written statement describing the parties’ right to participate in the mediation pilot program, including information on the timeframe to request mediation. If the employer or employee requests mediation, the employee cannot pursue any civil action until the mediation is complete.

The employee’s statute of limitations, including for all non-CFRA claims, shall be tolled upon receipt of a request to participate in the DFEH mediation until the mediation is complete. A mediation will be deemed complete when, at any time after the employer or employee’s request, the DFEH notifies the parties that it believes further mediation would be fruitless.

The pilot program will remain in effect until January 1, 2024.

Food Employees Must Be Permitted Frequent Handwashing

Finally, A.B. 1867 adds Section 113963 to the Health and Safety Code, which requires that a food employee working in any food facility, as defined in Section 113789 of the Health and Safety Code, be permitted to wash their hands every 30 minutes and additionally as needed.

For further information about A.B. 1867 or any other employment issue, contact your Baker McKenzie employment attorney.