California Updates Its Paid Family Leave Law with a Clean-Up Bill

BY MARTI CARDI, VP-PRODUCT COMPLIANCE & GAIL COHEN, DIRECTOR-EMPLOYMENT LAW/COMPLIANCE

 

NOTE TO READERS:  This topic was originally addressed in this blog on July 12, 2018.  That post sparked some questions about the California Paid Family Leave program that make it appropriate to issue this revised article.  The content of the original post was accurate but is now supplemented with additional information in this version, specifically relating to the two weeks of PTO an employer can require an employee to use before taking California PFL.

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Today’s post is not exactly earth shattering news, but we promise to keep you up to date on developments in leave laws and accommodations.  California has enacted a bill that makes a minor adjustment to the state’s paid family leave program – mostly a “technical correction” really. (CA A 2587)

The state family temporary disability insurance program, also known as the paid family leave program, provides wage replacement benefits to workers who take time off to care for a seriously ill family member or to bond with a minor child within one year of birth or placement of that child.

Existing California law allows an employer to require an employee to use up to 2 weeks of earned but unused vacation time before, and as a condition of, the employee’s initial receipt of paid family leave benefits during any 12-month period. Prior to January 1, 2018, California imposed a 7-day waiting period before employees could begin receiving benefits for a covered absence and the employer could apply that vacation pay to cover the waiting period. The 7-day waiting period for these benefits was eliminated as of January 1, 2018, by a prior law.

This new California law now eliminates the application of vacation leave to the waiting period, consistent with the removal of the 7-day waiting period for these benefits on and after January 1, 2018. After all, you can’t apply the employee’s vacation pay to the 7-day waiting period because there no longer is a 7-day waiting period.  Technically the effective date is January 1, 2019, but as there has been no waiting period since January 1, 2018, there has been nothing to which to apply that accrued vacation.

Employers are still able to require employees to use up to two weeks of accrued vacation or PTO, if available, prior to receipt of PFL benefits.  The use of such accrued paid time off is in addition to the 6 weeks of state or voluntary plan paid family leave benefits, which will follow the 2 weeks of PTO.  The statute refers to use of accrued “vacation” but material from the California Employment Development indicates that this includes an employer’s broader paid time off benefit as well.

Matrix can help!  Matrix is a leading provider of services for administering California State Disability Insurance and Paid Family Leave voluntary programs.  Ping us for more information at ping@matrixcos.com.

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