Labor & Employment Law

California Legislature Proposes Paid Sick Leave Law To Cover Every Employee In California

Assemblywoman Fiona Ma (D-San Francisco) introduced bill AB 2716 last week.  If passed, would provide paid sick leave to any employee who works for seven or more days each year - the only such law in the United States.  Employees would accrue sick time at the rate of one hour for every 30 hours worked.  Sick time would carry over from year to year. 

There are no exemptions for small businesses, which are defined in the bill as an employer who employs 10 or fewer employees during 20 or more calendar workweeks in the current or preceding calendar year.  So this means if you have one employee - a housekeeper for example - you would need to provide sick leave. 

The bill proposes that an employee would be entitled to use accrued sick time beginning on the 90th calendar day of employment.   Also, medium-to-large employers could limit annual paid sick days to nine days and small employers to five days. 

The sick leave would be available for use to care for a sick family member or to recover from domestic violence or sexual assault. Employers violating the law could face fines of up to $250 per incident.

What is the penalty for violations?  The bill proposes:

 [T]he payment of an additional sum as liquidated damages in the amount of fifty dollars ($50) to each employee or person whose rights under this article were violated for each day or portion thereof that the violation occurred or continued, plus, if the employer has unlawfully withheld paid sick leave to an employee, the dollar amount of paid sick leave withheld from the employee multiplied by three; or two hundred fifty dollars ($250), whichever amount is greater; and reinstatement in employment or injunctive relief; and further shall be awarded reasonable attorney's fees and costs.

So let's assume you employ 100 people.  For whatever reason there is a mistake and for 30 days it goes unnoticed and your company does not provide accrue sick leave as required under the bill.  This means you are on the hook for $150,000 ($50 x 100 employees x 30 days) and if you are deemed to have "unlawfully withheld" paid sick leave you owe another minimum $25,000 ($250 x 100 employees) for a grand total of $175,000.  Don't forget you would also be required to pay the plaintiff's attorney's fees and costs for bringing the lawsuit too. 

I am often asked, "What is the biggest area of liability facing California employers?"  The answer has easily been meal and rest and related wage and hour class actions.  However, if this bill becomes law, plaintiff's lawyers will have their next lawsuit of choice. 

Full post as published by California Labor & Employment Defense Blog on February 28, 2008 (boomark / email).