New 2018 Paid Sick Leave Rules for
Los Angeles Businesses and Employees

 

*** Updated December 1, 2017 

Effective July 1, 2017, all businesses in Los Angeles must abide by the City of Los Angeles’ new mandatory paid sick leave requirements.

Please read below for an overview of the new rules and how your business must comply.

All businesses based out of the City of Los Angeles, or with Los Angeles employees should adjust their practices, Employee Handbook or other policies to ensure ongoing compliance with California labor laws.

 


Overview of Current Requirements 

What’s New?  All businesses with 0-25 employees in the geographical boundaries of the City of Los Angeles must provided employees who have performed 30 days of services with paid sick leave of at least 6 days per year.

Options for Providing Paid Sick Leave.

Your business will have 2 options in providing the paid sick leave:

  • Front-Loaded Method:  Employer provides all forty-eight hours (48) of paid sick leave to employees at the beginning of the annual period.  The “begin date” of the annual period can be the employee’s anniversary start date, a calendar year, or a 12-month period of time.
  • Accrual Method. Employer provides one hour of paid sick leave every 30 hours worked.

Caps. If your business wishes to cap the total paid sick leave employees can accrue, it must do so in writing and by adopting this as its policy.  The minimum cap is 72 hours, meaning, your business cannot establish a cap that is lower than 72 hours.   You may set a higher cap or no cap at all.

Rollover. Paid sick leave benefits roll over from one annual period to the next. If your business sets caps on the total hours accrued (i.e., 72 hours), then the maximum capped hours of 72 hours, if unused, would roll-over from one annual period to another.

Cash-Out.  Unused paid sick leave is not cashed out and paid to the employee when the employee departs; however, if the employee rejoins the employer within 1 year of the date of separation, unused /accrued paid sick leave time is to be reinstated.

Stacking. Businesses who already provide employees with at least 6 Days / 48 hours of paid time off (PTO) do not need to provide additional paid sick leave time. PTO time can consist of paid vacation, paid days off, paid leave, or other paid time off. The PTO must be paid PTO time in order to cancel out your business’s obligation to provide 6 days of paid sick leave.

90-Day Probationary Period. Employers can make employees wait until 90th day of employment to begin using paid sick leave.


Top Questions and FAQs

Is our business required to comply? How do we know if we are obligated to comply?   All businesses with employees that provide at least 2 hours of employment in Los Angeles, California.  with no minimums on the size of the business, gross revenues, or number of employees.   If your business, or any person connected to your business, such as a corporate officer or executive, employs any person, you are subject to the new mandatory paid sick leave laws.

What does it mean to “employ” someone?  If you are concerned about whether your relationship with another party amounts to “employment,” the definition in California is very broad. If you exercise “control over the wages, hours, or working conditions of any person,” you can be deemed to have been employing them.

What types of employees are entitled to paid sick leave under the new July 1, 2017 requirements? Every employee who provides at least 2 hours of services in a particular week, within the geographic boundaries of the City of Los Angeles falls under the law.

What are the geographic boundaries of the City of Los Angeles? Click here to determine whether a business address is within the geographical boundaries of the City of Los Angeles. If your business or your employees are located in these boundaries, you and they will be subject to the new law.  There can be confusion about whether a business is located within the territorial limits of the unincorporated parts of Los Angeles. For a full list of what locations within LA County are actually “Cities” (and not unincorporated areas of Los Angeles), please click here: http://ceo.lacounty.gov/forms/09-10%20cities%20alpha.pdf.

Is there an exception for part-time or temporary employees?   No. There is no exception based on the type of the employee. As long as the employee provides at least 2 hours of services in a particular week, within the geographic boundaries of the City of Los Angeles, they will be entitled to paid sick leave under the new law. It does not matter whether they are part-time, temporary, seasonal, volunteers, or otherwise.

Are undocumented workers entitled to paid sick leave? Yes. The City of Los Angeles does not draw a distinction between citizens, legal permanent residence with a green card, or  undocumented workers. As long as the employee provides at least 2 hours of services in a particular week, within the geographic boundaries of the City of Los Angeles, they will be entitled to paid sick leave under the new law.

Our Business is not physically located in Los Angeles, or California. Do we need to comply?  Yes. If your employee provides at least 2 hours of services in a particular week, within the geographic boundaries of the City of Los Angeles, they will be entitled to paid sick leave under the new law. It would not matter whether your business is located in Los Angeles or California.

Our Employee works in Los Angeles, but does not actually live in Los Angeles. Are we required to provide paid sick leave?  Yes. If your employee provides at least 2 hours of services in a particular week, within the geographic boundaries of the City of Los Angeles, they will be entitled to paid sick leave under the new law.

Our part time employee only works a few days a week. When are they entitled to paid sick leave?  According to the Los Angeles Municipal Code, each “day” that the part-time employee works is considered one day. So, after the part-time employee works 30 days, whether continuously or not,   there are entitled to basically benefits.

Can a business switch paid sick leave methods (i.e., switch from front-loading to accrual basis)? Yes, but this can only be done once a year.

Do all employees have to be given paid sick leave using the same method? No. An employer can use different methods of providing sick leave for different classifications of employees.  An employer can switch between the two methods once  per year.

What can the paid sick leave be used for? The employee may use it for themselves or a family member, for any individual related by blood or affinity whose close association with the Employee is the equivalent of a family relationship. A family member is defined as a child, parent, spouse, registered domestic partner, grandparent, grandchild, or sibling.  Paid sick leave may be used for the purposes of preventive care or diagnosis, care, or treatment of an existing health condition, or for specified purposes of a victim of domestic violence, sexual assault, or stalking.

How much notice must the employee provide? The employee must notify the employer in advance, is the sick leave is planned. However, is the need to use paid sick leave is unforeseeable, then the employee only needs to give as much notice as is practicable. So for example, for an emergency basis,

Can the Employer ask for a doctor’s note? No,  unless the employee has used 3 days of paid sick leave consecutively. The City of Los Angeles only permits employers to ask for documentation in connection with paid sick leave if the employee takes 3 days of paid sick leave in a row. In addition, the City of Los Angeles’s ordinance says that employers must be cautious about the type of information they asked for, so that it does not deter employees from taking legitimate paid sick leave days.

What happens if the employer does not comply with the new rules?  The City of Los Angeles’ enforcement division has the authority to impose administrative fines, ranging from $500 – $1,000 per employee, per day, along with 50% increases for subsequent violations.  The employee can also bring an action in civil court.


Action Guide and Download Center: What Your Business Must Do

Below is a checklist to remain compliant with the new rules:

  • Post the New Poster. Post the poster in a conspicuous place at your office: English | Spanish
  • Download Notice & Templates. Does your business’s employee manual / handbook / policies and procedures accurately reflect paid sick leave requirements?  Don’t have a policy? Download the sample Notice & Policy Package here.  The download package includes templates for both accrual and up-front methods.
  • Check Wage Statements.  Are your business’s wage statements provided to employees with their paychecks accurately reporting to employees, how much paid sick leave they have ? Note: this is a requirement under California law.

 


Top Downloads/Resources

Check out our complete line of handy forms and templates for California small businesses.

 


Submit a Question

Have a question that is not answered? Submit your question below so we can help other businesses by contributing to the knowledge base.


AXIS Legal Counsel’s provides legal advice to numerous businesses throughout California with a variety of legal matters, including employment, employee relationships, labor law, and wage/hour matters, as well as compliance with California’s numerous employment and labor laws. We have assisted clients develop employment policies, become compliant with California’s wage and hour laws, prepare employee handbooks, management agreements, employment agreements, independent contractor agreements, and numerous similar labor law and employment legal matters. We have also represented clients in litigation matters involving employee and independent contractor disputes, mediations, lawsuits, and arbitrations. For information on retaining AXIS Legal Counsel to represent your business in connection with any legal matter, contact info@axislegalca.com or call (213) 403-0130 for a confidential consultation.

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