California Paid Sick Leave first went into effect in 2015. Now, eight years in, the state has decided to increase the three-day benefit to a five-day benefit. Beginning January 1, 2024, employees must be able to use up to 40 hours or five days per year of paid sick leave.
Accrual Methods
The standard accrual rate of 1 hour per 30 hours will remain the same. Employers using some other accrual method must allow employees to earn at least 24 hours by their 120th day of employment, or in each calendar year or other 12-month period (same as before), and all 40 hours by their 200th day of employment, or in each calendar year or other 12-month period. (Note that 24 hours in 120 days and 40 hours in 200 days will be earned at the same rate.)
Lump Sum Methods
Employers that provide leave in a lump sum must provide at least 24 hours or three days of sick leave to use no later than after an employee’s 120th day of employment (same as before) and all 40 hours or five days after their 200th day. Employers can still choose to provide the full amount of leave up front and aren’t required to provide it in two installments. They can also allow employees to use sick leave before completing 120 days of employment.
Employers still don’t have to allow carryover if they provide the full amount of leave (i.e., 40 hours or five days) at the beginning of each year using the lump sum method. However, the law doesn’t allow employers to avoid carryover if they choose to divide up an employee’s lump sum leave allotment into 24 and then 16 hours (or any other combination that doesn’t provide the full amount of leave at the start of the year).
Use Caps and Carryover
The yearly use cap is now 40 hours or five days instead of 24 hours or three days. The total (rolling) accrual cap is now 80 hours or 10 days instead of 48 hours or six days.
Preemption of Local Sick Leave Rules
The revised California Paid Sick Leave law includes preemption of certain provisions in local sick leave ordinances. This means that localities are required to adhere to the state law exactly on those particular issues, preventing them from creating or enforcing rules that are more restrictive or more favorable to employees.
Preemption applies to the following provisions:
- End of employment payout of employees’ unused sick leave
- Employer advancement of (unaccrued) sick days to employees
- Employer written notice requirement regarding available leave
- Rate of pay calculations for employees’ actual sick leave taken
- Employee notification for foreseeable and unforeseeable use of sick leave
- Timing of payment to employees for paid sick leave used
Thankfully, localities with their own sick leave laws have so far been almost totally aligned—or at least not in conflict—with the state on these topics. Employers in these locations shouldn’t have to overhaul their sick leave policies aside from ensuring that they offer as many hours as now required by the state. Localities are not barred from writing and enforcing more employee-friendly sick leave rules on matters not in this list, such as total number of hours accrued or acceptable reasons to use leave.
Employers in these locations should not need to completely revamp their sick leave policies, except for ensuring compliance with the state’s updated requirements. Localities are still permitted to establish and enforce more employee-friendly sick leave rules on matters not in this list, such as total accrued hours or acceptable reasons to use leave.
Action Items for Employers:
- Update your sick leave policies to comply with the increased hours
- If you use bundled policies, such as paid time off or flexible time off that includes both sick and vacation time, make certain that those are also at least as generous as the updated sick leave requirements
- Distribute updated policies to your employees by January 1, 2024
- Be on the lookout for an updated Paid Sick Leave poster from the California Department of Industrial Relations
