The California Employment Development Department, the agency responsible for administering the state’s Paid Family Leave (PFL) benefits program, recently announced a grant program to help small businesses offset the costs associated with employees taking paid family leave.

Last year, California passed the COVID-19 Supplemental Paid Sick Leave law (SPSL), requiring employers with more than 25 employees to provide supplemental paid sick leave for certain absences related to COVID-19. Intended as a temporary measure, the law expired on September 30, 2021. However, given the pandemic’s continued impact, SPSL was recently revived as Senate Bill 114 and signed back into law (2022 SPSL) by Governor Gavin Newsom on February 9, 2022, with a few notable changes from last year.  

On July 15, 2021, the California Supreme Court handed down a decision which will have a significant impact on the way employers must pay hourly/non-exempt employees for missed meal periods, rest periods, and heat illness recovery periods. In Ferra v. Loews Hollywood Hotel, LLC, the Court held that such payments must be made at the “regular” rate of pay, not the base hourly rate. The court’s decision also will have a retroactive effect, meaning that employers must immediately change payroll practices and potentially pay employees back wages for the last four years.

On March 29, 2021, a new California law took effect mandating COVID-related supplemental paid sick leave for employers with more than 25 employees. Specifically, Senate Bill (SB) 95 creates new Labor Code Section 248.2, which requires employers to provide supplemental paid sick leave for certain absences related to COVID-19, in addition to other paid time off benefits to which they are already entitled. This law (referred to below as the “2021 SPSL law”) applies retroactively to January 1, 2021 and is effective through September 30, 2021.

Time rounding is common practice used by employers of hourly employees to simplify their payroll calculations. Although this practice is legal, federal and state guidelines do exist on how to fairly round “hours worked” by employees. Recently, the California Supreme Court offered additional parameters on the use of time rounding, holding that such practices are not permissible in the context of providing non-exempt (hourly) employees their 30-minute unpaid meal periods.

The Occupational Safety and Health Administration (OSHA) recently issued guidance to employers in the form of best practice recommendations for protecting employees from COVID-19. Intended only for workplaces outside the healthcare industry, OSHA’s “Protecting Workers: Guidance on Mitigating and Preventing the Spread of COVID-19 in the Workplace” focuses on the creation of a COVID-19 prevention program which prioritizes employee involvement, communication and training.

If you are a private-sector company with employees in California, please take note of the following new laws which go into effect as of January 1, 2021 (or earlier, as indicated below). Businesses impacted by these changes should review and update existing policies and procedures, including employee handbooks and records retention policies, independent contractor agreements, and arbitration agreements.

Beginning January 1, 2021, the California Family Rights Act (CFRA) will require businesses with five or more employees to provide up to 12 weeks of unpaid, job-protected family care and medical leave annually to eligible employees.