SB 616: Expanding Paid Sick Leave Entitlements in 2024
Posted on October 27, 2023
Starting January 1, 2024, SB 616 will bring significant changes to the paid sick leave entitlements for employees in California. Employers must understand these new requirements to ensure compliance and maintain a supportive work environment for their employees— many are turning to outsourced HR solutions in California to remain up-to-date and compliant with ever-changing state regulations.
This article provides a comprehensive overview of the critical changes and the options available for employers to meet these new requirements:
Key Changes in SB 616
- Expansion of Paid Sick Leave Entitlements: Under the current law, employees are entitled to three days or 24 hours of paid sick leave per year. With the implementation of SB 616, this entitlement will expand to five additional days or 40 hours of paid sick leave per year.
- Inclusion of Family Members: The current law only allows employees to use paid sick leave for their own illness, injury, or health condition. With SB 616, employees can also utilize this benefit to take care of a family member suffering from an illness, injury, or health condition. This includes the employee’s child, parent, spouse, or registered domestic partner, grandparent, grandchild, and sibling.
- Broader Definition of Family Member: SB 616 also expands the definition of family member to include a designated person selected by the employee for care and assistance. This could be a close friend, neighbor, or any other individual with whom the employee has a meaningful relationship.
- Removal of Annual Accrual Limit: Under the current law, employers can limit an employee’s accrued paid sick leave to six days.
SB 616 expands the definition of employees eligible for paid sick leave entitlements to include more workers. This change is significant as it will cover a broader range of individuals, including part-time and temporary employees. The bill also eliminates the previous requirement that employees must work at least 30 days in California to be eligible for paid sick leave benefits. Under SB 616, an employee will be entitled to paid sick leave benefits from the first day of employment.
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Options for Employers to Meet the New Requirements
Employers have several options available to comply with the new requirements under SB 616. These include:
- Modification of Existing Paid Time Off (PTO) Policies: Employers can modify their existing PTO policies to meet the minimum requirements of SB 616. Employers can either add the five additional days or adjust their current policy to include family members in the definition of illness.
- Implementation of a Separate Sick Leave Policy: Employers may opt to implement a separate sick leave policy solely focused on meeting the requirements of SB 616. This option would allow employers to have more control over sick leave.
The primary change brought by SB 616 is the expansion of paid sick leave coverage to include victims of domestic violence, sexual assault or stalking. This means that employees who are survivors of these crimes can now use their accrued paid sick leave for medical treatment, therapy/counseling, legal proceedings and other related activities.
Previously, California’s paid sick leave law (Healthy Workplaces, Healthy Families Act of 2014) only allowed employees to use their accrued paid sick leave for their own illness or injury, the care of a family member or preventive medical care. With SB 616, this list will now include victims of domestic violence, sexual assault or stalking.
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Potential Challenges and Recommended Actions for Employers
Implementing SB 616 can pose unique challenges for employers. The expanded coverage and definition of employees eligible for paid sick leave may increase employer costs, and managing these changes while maintaining business efficiency could be difficult. Furthermore, employers must maintain privacy and sensitivity when dealing with employees who are victims of domestic violence, sexual assault or stalking.
- Increased employer costs: The extension of paid sick leave to part-time and temporary employees, as well as the removal of the 30-day work requirement, could result in increased labor costs. Employers should examine their current workforce and budgetary constraints to anticipate the potential fiscal impact.
- Privacy concerns: Addressing the needs of employees who are victims of domestic violence, sexual assault or stalking requires a delicate balance between providing support and maintaining confidentiality. Employers must ensure they have policies in place to oversee such situations with care and discretion.
- Compliance: With the implementation of SB 616, employers must review and update their existing sick leave policies to ensure compliance. Legal guidance could be beneficial in making sure all requirements are met.
Overcoming these challenges will necessitate strategic thinking, careful planning, and some budget adjustment. However, these actions are essential to maintaining a supportive and inclusive workplace environment.
Employers must inform and educate their employees about these changes, by updating their paid sick leave policy or providing a notice to all employees. This notice should explain the expansion of paid sick leave coverage and how employees can use this entitlement.
In addition, employers must update their payroll systems to ensure that accrued paid sick leave is properly tracked and recorded for employees who may need it for expanded purposes. Employers must also ensure that their employees’ confidentiality is maintained when using paid sick leave for reasons related to domestic violence, sexual assault or stalking.
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Options Available for Employers
Employers have several options available to meet the new requirements brought by SB 616. The first option is to update their current paid sick leave policy and provide a notice to all employees about
SB 616 amends California Labor Code sections 245.5, 246, and 246.5. The most notable alteration is the expansion of paid sick leave entitlements from the current 24 hours or three days per year to 40 hours or five days (whichever is greater) per year, effective January 1, 2024.
Options for Paid Sick Leave Compliance
Employers are given three options to choose from for compliance with the new paid sick leave requirements:
- Accrual Method: As before, employees can accrue one hour of sick leave for every 30 hours worked.
- Front-loading Method: Employees receive an upfront grant of 40 hours or five days of paid sick leave (whichever is greater) at the beginning of employment and each 12-month period thereafter. No carryover or accrual of sick leave is required in this option.
- Alternative Accrual Method: Employees can accrue sick leave at a rate other than one hour for every 30 hours worked, provided that the accrual is regular and meets the required minimums. This method must ensure that employees accrue no less than 24 hours or 3 days of sick leave by the 120th day of employment, and no less than 40 hours or 5 days by the 200th day of employment.
Accrual Cap and Usage Limit
Waiting period. While the law requires leave to begin accruing immediately upon hire, employers may choose to implement a 90-day waiting period before new hires are eligible to use their earned paid sick leave. Note: employers providing a lump sum of paid sick leave have 120 calendar days from the hire date to do so. Therefore “earned” leave may not be available for employee use until the 120th day of employment.
When utilizing the accrual method (i.e., not front-loading), SB 616 also allows employers to set certain limitations on accrued sick leave:
- A maximum accrual cap of 80 hours or 10 days
- A use limit of 40 hours or five days per 12-month period
Please note that it permits a maximum accrual cap of 48 hours or six days and a usage limit of 24 hours or three days per 12-month period. These values will change once SB 616 comes into effect.
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Impact on In-Home Supportive Services Providers
Additionally, SB 616 amends the sick leave requirements for providers of in-home supportive services, making it essential for these organizations to review and adjust their policies.
Why Outsource Your HR Solutions in California?
As a business owner or HR manager, ensuring compliance with SB 616’s paid sick leave changes in 2024 is crucial. Outsourcing HR solutions in California is a strategic choice for businesses looking to maintain compliance with state and federal regulations. California’s ever-evolving employment laws, such as SB 616, can be a legal minefield for even the most diligent businesses.
HR outsourcing companies specialize in navigating these complex regulations, ensuring that all policies and practices are in full compliance. This not only helps to mitigate legal risks and potential penalties but also allows companies to focus on their core operations without being burdened by the complexities of HR and compliance, ultimately saving time, money and resources while promoting a more efficient and compliant workplace.
Getting Started with Outsourced HR Solutions in California
eqHR solutions plays a crucial role in assisting businesses to navigate the intricate landscape of ever-changing California regulations, including SB 616.
We offer expert guidance on compliance, risk management and contract administration. With our knowledge and support, businesses can ensure that they meet the requirements of SB 616 and other relevant regulations, minimizing legal risks and enhancing their ability to succeed in California’s challenging business environment.
Contact us for a free consultation.