California’s New COVID-19 Sick Leave (SB114)

The law is effective February 19, 2022 and retroactive to January 1, 2022. While the new legislation is similar to California’s prior bill (SB 95), which expired September 30, 2021, there are some notable differences this time around.

Which Employers Does the New Law Apply To?

Like SB 95, the new law applies to employers with “more than 25 employees.” Smaller employers will not be covered but may be covered by local supplemental paid sick leave ordinances.

How Long Will the Law Be in Effect?

SB 114 will be in effect through September 30, 2022.

How Much Leave Does the Law Provide?

Like SB 95, the new law provides up to 80 hours of SPSL for full-time employees. However, SB 114 is different in that it establishes two “buckets” of up to 40 hours of leave for different purposes and with different requirements.

Bucket # 1 – Up to 40 Hours for COVID Qualifying Reasons

The first category of leave provides for up to 40 hours of leave for a number of COVID-19 related reasons. These correspond generally with the qualifying reasons that previously applied under SB 95. Leave must be provided if the employee is unable to work or telework for any of the following reasons:

• The employee is subject to a quarantine or isolation period related to COVID-19 as defined by an order or guidance of the State Department of Public Health, the federal Centers for Disease Control and Prevention, or a local public health officer who has jurisdiction over the workplace.
• The employee has been advised by a healthcare provider to isolate or quarantine due to COVID-19.
• The employee is attending an appointment for themselves or a family member to receive a vaccine or a vaccine booster for protection against COVID-19.
• The employee is experiencing symptoms, or caring for a family member experiencing symptoms, related to a COVID-19 vaccine or vaccine booster that prevent the employee from being able to work or telework.
• The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
• The employee is caring for a family member who is subject to an order or guidance described above or who has been advised to isolate or quarantine, as described above.
• The employee is caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.

Bucket # 2 – Up to an Additional 40 Hours for Positive COVID-19 Tests

The second category of leave entitles an employee to the same amount of leave they qualified for under the first category (up to 40 hours) if the employee tests positive for COVID-19, or a family member for whom the employee is providing care tests positive for COVID-19.
Significantly, SB 114 authorizes the employer to require proof of a positive test in such situations.

First, if the employee tested positive, an employer may require the employee to submit to a diagnostic test on or after the fifth day after the initial test was taken and provide documentation of those results. SB 114 specifically states that the employer shall make such a test available at no cost to the employee.

Second, if the employee requests to use additional leave because a family member for whom they are providing care tests positive for COVID-19, the employer may require that the employee provide documentation of that family member’s test results before paying the additional leave.
SB 114 specifically provides that an “employer has no obligation to provide additional COVID-19 supplemental paid sick leave…for an employee who refuses to provide documentation of the results of the test…upon the request of the employer.”

How Much Leave Must Be Provided to Part Time Employees or Those with Variable Schedules?

SB 114 provides a specific method for calculating the amount of eligible leave for employees who work part time or have variable schedules. This methodology tracks the process that was utilized under the previous SB 95:

• If the employee has a normal weekly schedule, their eligible leave is the total number of hours the employee is normally scheduled to work for the employer over one week.

Employers should note that this methodology determines the amount of leave the employee is entitled to under Bucket # 1. As discussed above, the employee would then also be eligible for the same amount of leave under Bucket # 2.

What Are the Retroactive Requirements?

SB 114 is retroactive to January 1, 2022. So, if an employee took leave dating back to the first of the year for one of the qualifying reasons that was either unpaid by the employer or not paid at the same level required by SB 114, the employee may make an oral or written request for retroactive payments.

A similar process was included in the prior SB 95, so employers should generally be familiar with this process. Retroactive payments must be paid on or before the payday for the next full pay period after the request is made.

In addition, SB 114 provides that an employer may require an employee to provide documentation of a positive test if the employee requests retroactive leave for a positive test or caring for a family member with a positive test.

How Does SB114 Interact with Cal/OSHA Exclusion Pay?

An unwelcome change under SB 114 involves how leave interacts with “exclusion pay” under Cal/OSHA’s ETS. Employers are no longer allowed to require employees to first use and exhaust their leave during periods the employee is entitled to exclusion pay.

Previously, an employer was allowed to require an employee to use SPSL before being obligated to pay exclusion pay under Cal/OSHA’s ETS. However, SB 114 takes the opposite approach. The legislation states, “An employer shall not require a covered employee to first exhaust their COVID-19 supplemental paid sick leave under this section before satisfying any requirement to provide paid leave for reasons related to COVID-19 under any Cal-OSHA COVID-19 Emergency Temporary Standards.”

With certain exceptions, Cal/OSHA’s ETS requires employers to continue to pay the earnings of employees who are excluded from the workplace as a COVID-19 case or close contact. This means employers may be required to provide significantly more paid time off for employees because employees who are excluded under Cal/OSHA’s ETS will be paid exclusion pay and maintain their full entitlement of SPSL.

Is There a Notice Requirement?

Employers are required to post a notice about leave similar to the notice employers post regarding regular paid sick leave under Labor Code Section 247. SB 114 requires the Labor Commissioner to develop a model notice within seven days of the enactment of the new law.

What Paystub Requirements Apply?

Thankfully, SB 114 takes a different paystub approach from the prior version. Rather than list the eligible hours, the legislation requires employers to instead list the amount of leave the employee has used through the applicable pay period. If an employee has not used any leave, the employer shall list zero hours on the paystub. This should reduce the burden on employers from having to make complicated calculations each pay period (as required under the prior law). In addition, SB 114 says leave hours used should be listed separately from regular paid sick days.

Are Tax Credits Available to Pay for This?

Not directly. While the governor and legislative leaders have talked up tax credits being part of the agreement to bring back leave, the referenced tax credits are not directly tied to it, nor do they provide “dollar for dollar” reimbursement like under the federal FFCRA.

Next Steps

Be prepared to quickly comply with this new requirement. To do so, below are some recommended steps:

• Prepare an updated policy.
• Plan for the paystub requirement.
• Keep an eye out for the notice that will be posted by the Labor Commissioner’s office.
• Have a process in place to handle leave requests (both new and retroactive).
• Evaluate the number of retroactive or true-up payments you may need to make.
• Remember not to request any other medical information or underlying diagnosis when requesting documentation to support the leave request.
• Remember that you cannot use leave before paying exclusion pay.