California has long been a pioneer in employee benefits, especially with the introduction of Paid Sick Leave in 2015. Originally set at 24 hours, this provision was soon overshadowed by more generous policies in other states and regions. Recognizing the need for an update, California has now expanded its sick leave policy. Effective January 1, 2024, employees will be entitled to 40 hours or five days of paid sick leave annually, a significant increase from the previous three-day allowance. https://www.dir.ca.gov/wpnodb.html
Understanding Accrual and Lump Sum Methods
The accrual method remains unchanged, with employees accruing 1 hour of sick leave for every 30 hours worked. However, the new legislation mandates that employees must accrue at least 24 hours by the 120th day of employment and the full 40 hours by the 200th day. This change ensures a more rapid accumulation of sick leave for employees.
For employers using the lump sum method, they must now provide a minimum of 24 hours or three days of sick leave by the employee’s 120th day of employment, with the full 40 hours or five days available after 200 days. Employers have the flexibility to offer the entire sick leave amount upfront without waiting for these milestones.
Caps and Carryover Adjustments
The yearly usage cap has been revised to 40 hours or five days, up from the previous cap of 24 hours or three days. Additionally, the total accrual cap now stands at 80 hours or 10 days, doubling the former limit of 48 hours or six days.
Preemption of Local Sick Leave Rules
The updated law preempts certain aspects of local sick leave ordinances, ensuring statewide consistency in specific areas such as:
- Payout of unused sick leave at the end of employment
- Advancement of sick days
- Written notice requirements for available leave
- Calculations for pay during sick leave
- Notification and timing protocols for sick leave usage
While local ordinances are still influential, they must align with these state-level stipulations, though they are free to implement more favorable conditions on topics not covered by the preemption.
Action Steps for Employers
- Revise sick leave policies to reflect the increased hour requirements.
- If you have bundled policies (combining sick and vacation time), ensure they meet or exceed the new sick leave standards.
- Distribute the updated policies to employees well before the January 1, 2024, deadline.
- Stay informed about further updates, including new sick leave posters from the California Department of Industrial Relations.
This expansion of paid sick leave in California marks a significant step towards enhanced employee welfare, and it is crucial for employers to understand and comply with these changes to ensure a smooth transition into the new policy framework.
