(1)Under existing law, an employee who works in California for 30 or more days within a year from the commencement of employment is entitled to paid sick days for certain purposes, to be accrued at a rate of no less than one hour for every 30 hours worked, and to be available for use beginning on the 90th day of employment, so that an employee has no less than 24 hours of accrued sick leave or paid time off by the 120th calendar day of employment or each calendar year, or in each 12-month period. Existing law provides that an employer may satisfy the accrual requirements of this section by providing not less than 24 hours or 3 days of paid sick leave that is available to the employee to use by the completion of his or her 120th calendar day of employment. Under existing law an employer has no obligation under these provisions to allow an employees total accrual of paid sick leave to exceed 48 hours or 6 days, provided that an employees rights to accrue and use paid sick leave are not otherwise limited, as specified. Under existing law, an employer is required to permit sick leave to carry over to the following year of employment, but may limit the carryover amount to 24 hours or 3 days.

This bill would change the requirements of the employers alternate sick leave accrual method to require no less than 40 hours of accrued sick leave or paid time off by the 200th calendar day of employment, as specified. The bill would also provide an employer is under no obligation to allow an employees total accrual of paid of sick leave to exceed 80 hours or 10 days, as specified. The bill would raise the limitation on sick leave carried over to the following year of employment to 40 hours or 5 days.

(2)Existing law provides that providers of in-home supportive services accrue sick leave in accordance with a schedule that is based on the timeline for state minimum wage increases, up to a maximum of 24 hours or 3 days when the minimum wage reaches $15 per hour.

This bill would increase the sick leave accrual for in-home supportive services providers to 40 hours or 5 days for employment beginning January 1, 2026.

Date of Hearing: April 25, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2841

Author:(Gonzalez Fletcher) – As Introduced Ver:February 16, 2018

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill increases the minimum amount of sick leave an employee is entitled to accrue to 40 hours by the 200^th calendar day of employment, and allows an employer to limit an employee’s use of this leave to 40 hours, or five days, in each year of employment. This bill also increases the sick leave accrual for in-home supportive services (IHSS) providers to 40 hours, or five days, beginning January 1, 2026.

FISCAL EFFECT:

1. One-time special fund costs of $450,000 and ongoing special fund costs of $400,000 for the Department of Industrial Relations (DIR) to investigate and enforce additional wage and retaliation claims.
2. Annual General Fund costs in excess of $60 million beginning in 2026 to expand sick leave to more than 450,000 IHSS providers in California.

COMMENTS:

Background and purpose. AB 1522 (Gonzalez fletcher), Chapter 317, Statutes of 2014, established a requirement for employers to provide a minimum of three days of sick leave to their employees. Under current law, sick leave must accrue at a rate of no less than 1 hour for every 30 hours worked so that an employee has no less than 24 hours of accrued leave by the 120^th calendar day of employment.

According to the author, AB 2841 will ensure that California keeps pace with the growing movement of providing employees adequate paid sick time. The author points to ordinances adopted by California cities or other state laws that provide more robust benefits than those guaranteed under state law. As of this year, Maryland, Washington, Arizona, Massachusetts, Oregon and Connecticut allow workers to accrue five paid sick days.

Analysis Prepared by: Luke Reidenbach / APPR. / (916) 319-2081

Date of Hearing: April 11, 2018

ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT

Tony Thurmond, Chair

ABPCA Bill Id:AB 2841 (

Author:Gonzalez Fletcher) – As Introduced Ver:February 16, 2018

SUBJECT: Sick leave: accrual and use

SUMMARY: Increases the minimum amount of sick leave that an employee may and increases how much sick leave can be carried over to the next year. Specifically, this bill:

1. Changes the requirements of the employer’s alternate sick leave accrual method to require no less than 40 hours of accrued sick leave or paid time off by the 200th calendar day of employment, as specified.
2. Provides an employer is under no obligation to allow an employee’s total accrual of paid of sick leave to exceed 80 hours or ten days, as specified.
3. Raise the limitation on sick leave carried over to the following year of employment to 40 hours or five days.
4. Increases the sick leave accrual for in-home supportive services providers to 40 hours or five days for employment beginning January 1, 2026.

EXISTING LAW:

1. Ensures an employee who works in California for 30 or more days within a year from the commencement of employment is entitled to paid sick days for certain purposes.
2. Mandates sick leave to be accrued at a rate of no less than one hour for every 30 hours worked, and to be available for use beginning on the 90th day of employment, so that an employee has no less than 24 hours of accrued sick leave or paid time off by the 120th calendar day of employment or each calendar year, or in each 12-month period.
3. Provides that an employer may satisfy these accrual requirements by providing not less than 24 hours of paid sick leave that is available to the employee to use by the completion of his or her 120th calendar day of employment.
4. Ensures that an employer has no obligation under these provisions to allow an employee’s total accrual of paid sick leave to exceed 48 hours, provided that an employee’s rights to accrue and use paid sick leave are not otherwise limited, as specified.
5. Permits sick leave to carry over to the following year of employment, but allows the employer to limit the carryover amount to 24 hours or three days.

FISCAL EFFECT: Unknown

COMMENTS: According to the author, “The bill will ensure California keeps pace with the growing movement of providing all employees with the ability to take care of themselves or a family member without risking economic or job security. Cities across California, such as San Francisco, Oakland, Emeryville, Santa Monica, San Diego, Los Angeles, and Berkeley, have passed ordinances granting workers more expansive paid sick leave than what currently exists under state law. As of this year, Maryland and Washington have also allowed workers to accrue five paid sick days – joining Arizona, Massachusetts, Oregon, and Connecticut.”

Arguments in Support

Legal Aid at Work and others wrote in support that, “Every California employee will get sick or need to care for a sick family member at some point. The Centers for Disease Control and Prevention reported that people who fell ill with the severe flu this year needed at least one week to recover. Although state law provides for a minimum of 3 paid sick days per year, many people and families will need more time than that to recover from illness.”

Fiona Ma, Vice Chair of the Board of Equalization, writes in support, “Parents without sufficient paid sick leave are twice as likely to send a sick child to school, leading to high likelihood of delayed education development and poor health. Parents are also five times more likely to have to take their child to the emergency room because of their inability to take sufficient time off during the work day, which can create extra financial burdens associated with delayed health services.”

The Restaurant Opportunities Centers of CA writes in support of the bill, “Our 2010 national study, “Serving While Sick” is the largest study every conducted on health conditions of restaurant workers. This study found that over 87% of restaurant workers reported not having paid sick days, and thus, 63% of workers reported preparing, cooking and serving while sick. Paid sick days are essential to ensure that both workers and those they serve are safe from avoidable harmful risks to their health.”

Arguments in Opposition

The Chamber of Commerce and others write, “Increasing the number of paid sick days from 3 to 5 might not seem like a huge burden, unless you are a California employer. Employer costs in California continue to be on the rise as the minimum wage increases, we have the highest income tax rates in the nation, and among the highest energy and workers’ compensation costs. Additionally, the minimum wage continues to increase $1.00 each year until January 2022. This $1.00 increase is in addition to the other cumulative costs employers are already facing such as increased real estate costs and state tax increases.” 

The Chamber and others continue, “Given the cumulative costs and existing protected leaves of absence California employers are already struggling with, California should refrain from mandating additional sick days and instead should incentivize employers to offer more expansive sick day benefits by reducing costs in other areas.   One area in which California can reduce costs on employers so that they have the capacity to offer paid sick leave is daily overtime.  California is one of only three states that mandate both daily and weekly overtime, creating a huge cost to employers.  If this cost were reduced by conforming to federal law and only mandating weekly overtime, employers would more likely have the ability to offer paid sick leave as well as provide a more flexible schedule for working families.”  

Paid Sick Leave and Economic Security

A 2017 report form the Economic Policy Institute titled “Work Sick or Lose Pay?” finds, among other things, the following:

“Lack of paid sick days is a real problem, particularly for low-wage workers, and it shows up in the large paid sick days gap between high- and low-wage workers. While approximately 64 percent of private-sector American workers currently have access to paid sick days, this topline number masks the fact that higher-wage workers have much greater access to paid sick days than lower-wage workers do: for example, 87 percent of private-sector workers in the top 10 percent of wages have the ability to earn paid sick days, compared with only 27 percent of private-sector workers in the bottom 10 percent.

Lack of paid sick days deprives workers of funds needed for basic necessities. Without the ability to earn paid sick days, workers must choose between going to work sick (or sending a child to school sick) and losing much-needed pay. For the average worker who does not have access to paid sick days, the costs of taking unpaid sick time can make a painful dent in the monthly budget for the worker’s household:

If the worker needs to take off even a half day due to illness, the lost wages are equivalent to the household’s monthly spending for fruits and vegetables; lost wages from taking off nearly three days equal their entire grocery budget for the month.

Two days of unpaid sick time are roughly the equivalent of a month’s worth of gas, making it difficult to get to work.

Three days of unpaid sick time translate into a household’s monthly utilities budget, preventing the worker from paying for electricity and heat.

In the event of a lengthier illness—say, seven and a half days of unpaid sick time—the worker would lose income equivalent to a monthly rent or mortgage payment.”

Paid Leave in Other States

Eight other states and Washington, D.C. currently require employers to provide paid sick leave. Six of those states (Arizona, Connecticut, Maryland, Massachusetts, Oregon and Washington) allow employees to accrue a minimum of 40 hours of sick leave, as proposed by this legislation.

According to the National Conference of State Legislatures, “Connecticut was the first state to require private sector employers to provide paid sick leave to their employees, with a law enacted in 2011. California became the second state to enact paid sick requirements, with the passage of the Healthy Workplace, Healthy Families Act of 2014. Massachusetts was the third state to require paid sick leave, as voters there approved the Earned Sick Time for Employees ballot measure during the 2014 general election. The Oregon Legislature enacted a law during the 2015 session, and the Vermont Legislature did so during the 2016 session. During the 2016 general election, voters in Arizona and Washington approved ballot measures requiring employers to provide paid sick leave. The Rhode Island Legislature was the only state to pass a paid sick leave law in 2017, which will take effect in 2018. The Maryland Legislature overrode a gubernatorial veto of paid sick leave legislation in January 2018; the law took effect the next month.”  

Prior Legislation

SB 3 (Leno), Chapter 4, Statutes of 2016. Increased the state minimum wage, ultimately to $15 per hour, indexes the minimum wage thereafter, and provides for paid sick days to providers of in-home supportive services.

AB 1522 (Gonzalez), Chapter 317, Statutes of 2014. Established a requirement for employers to provide a minimum of three days of sick leave to their employees.

AB 400 (Ma), 2011. Would have allowed an employee who works for a small business (10 or fewer employees) to accrue a minimum of up to of five days of sick leave and all other employees to accrue a minimum of up to of nine days of sick leave. Held under submission in the Assembly Appropriations Committee.

AB 109 (Knox), Chapter 164, Statutes of 1999. Required employers who provides sick leave for employees to permit an employee to use a specified portion of the employee's accrued sick leave to attend to the illness of a child, parent, or spouse of the employee.

REGISTERED SUPPORT / OPPOSITION:

Support

AARP California

ACLU California Center for Advocacy and Policy

BreastfeedLA

California Employment Lawyers Association

California Partnership to End Domestic Violence

CWA Political Action

Fiona Ma, State Board of Equalization Member

Koreatown Immigrant Workers Alliance

Legal Aid at Work

Mi Familia Vota

National Hispanic Council on Aging

Organization United for Respect - OUR Walmart

Restaurants Opportunities Centers of California United

Rise Together

YWCA San Francisco & Marin

Opposition

African American Farmers of California

American Pistachio Growers

Associated Builders and Contractors, Inc. – Northern California Chapter

Associated General Contractors

Association of California School Administrators

California Agriculture Aircraft Association

California Ambulance Association

California Association of Nurseries and Garden Centers

California Association of School Business Officials

California Association of Winegrape Growers

California Beer and Beverage Distributors

California Business Properties Association

California Chamber of Commerce

California Cotton Ginners and Growers Association, Inc.

California Farm Bureau Federation

California Fresh Fruit Association

California Grocers Association

California League of Food Producers

California Manufacturers and Technology Association

California Professional Association of Specialty Contractors

California Restaurant Association

California Retailers Association

California School Boards Association

California State Association of Counties

California Tomato Growers Association

California Travel Association

California Trucking Association

Camarillo Chamber of Commerce

Civil Justice Association of California

Construction Employers’ Association

Family Business Association of California

Far West Equipment Dealers Association

Greater Coachella Valley Chamber of Commerce

Greater Conejo Valley Chamber of Commerce

League of California Cities

National Federation of Independent Business

Nisei Farmers League

Official Police Garages of Los Angeles

Orange County Business Council

Oxnard Chamber of Commerce

Rancho Cordova Chamber of Commerce

Santa Maria Valley Chamber of Commerce

Simi Valley Chamber of Commerce

Southwest California Legislative Council

Western Agricultural Processors

Western Growers Association

Wine Institute

Analysis Prepared by: Jennifer Richard / L. & E. /