Sick of It Yet? The DLSE Issued New Paid Sick Leave FAQs

4 minute read | June.07.2017

Paid sick leave remains an epidemic that won’t quit.  Since California enacted the Healthy Workplaces, Healthy Families Act of 2014 (Cal. Lab. Code § 245, et seq.) (“California Paid Sick Leave”), paid sick leave laws have spread to both state and local levels, requiring employers to maneuver a patchwork of laws.  These laws left several unanswered questions in their wake.  Indeed, the unanswered questions were so numerous that the California Legislature passed a fix-it bill of amendments revising and clarifying California Paid Sick Leave only a few months after it took effect.  Despite the fix-it bill, several questions remained.

On March 29, 2017, the California Labor Commissioner, through the Division of Labor Standards Enforcement (the "DLSE"), attempted to provide further guidance by issuing an update to its California Paid Sick Leave: Frequently Asked Questions (“FAQs”).  The updated FAQs address questions regarding the use of "grandfathered" paid time off ("PTO") policies and the intersection of California Paid Sick Leave and employer attendance policies.  Here are the takeaways:

Existing FAQs stated that employers may satisfy California Paid Sick Leave requirements through a “grandfathered” (i.e., existing) PTO policy that allows employees to take paid time off for the same purposes of paid sick leave, and that otherwise meets the law’s minimum requirements.  In other words, if an employer’s existing PTO plan offered at least the minimum amount of paid leave that could be used for the same (or more favorable) purposes of California Paid Sick Leave,[1] the employer could continue to use the PTO plan after July 1, 2015 without further modification.

The updated FAQs provide additional guidance on how grandfathered PTO policies may comply with California Paid Sick Leave.  Specifically, the updated FAQs confirm that California Paid Sick Leave only prescribes the rate of pay for paid sick time.  That is, if an employer provides paid sick days through a grandfathered PTO plan, California Paid Sick Leave has no bearing on the rate of pay when an employee takes paid time off for any other purpose, such as vacation or personal time.  Accordingly, under a grandfathered PTO policy, employers can pay the “base rate” for vacation or personal time off, rather than the higher regular rate of pay required for paid sick time.

The DLSE’s new FAQs also address the use of employer attendance policies in relation to California Paid Sick Leave.  To mitigate absenteeism, many employers adopt attendance policies under which employees may be given an “occurrence” for unscheduled absences.  As we cautioned here and here, giving employees an “occurrence” or taking other disciplinary action based on the use of paid sick time may violate the anti-retaliation provisions of California Paid Sick Leave.  The updated FAQs confirm that not all forms of leave taken for illness or related purposes qualify for the anti-retaliation protections.

California Paid Sick Leave prohibits disciplinary action only with respect to an employee’s use of "accrued and available paid sick leave as specified under the statute."  (Emphasis added).  The law specifically protects the right of employees to request paid leave that has been earned—not simply the right to seek leave for medical purposes.  Accordingly, an employer may not discipline an employee for an unscheduled absence that occurs for a qualifying reason if the employee uses available and accrued paid sick leave time.  Conversely, an employer can discipline an employee for an unscheduled absence that occurs for a qualifying purpose if the employee does not have accrued and available paid sick time.  Thus, while California Paid Sick Leave does not require employers to record the reason for using sick leave or PTO, employers should track when an employee wants to designate a PTO day as sick leave to mitigate the risk of inadvertently taking an adverse action.

While the updated FAQs do not have the force of law, they indicate how the Labor Commissioner likely will enforce California Paid Sick Leave. California employers should review their paid sick leave and attendance policies to ensure compliance.

[1] California Paid Sick Leave requires employers to provide at least one hour of paid sick leave for every thirty (30) hours worked, or a minimum annual lump sum of twenty-four (24) hours.  Sick leave may be used for the diagnosis, care, or treatment of an existing health condition of, or preventive care for, an employee or an employee’s family member; and to obtain various forms of care in connection to an employee's status as a victim of domestic violence, sexual assault, or stalking.