United States: San Diego Finalizes Amendments To The Earned Sick Leave And Minimum Wage Ordinance

On August 3, 2016, San Diego's mayor approved amendments to the city's Earned Sick Leave and Minimum Wage Ordinance.  Voters had originally approved the Ordinance on June 7, 2016 and the City Council had certified it on July 11, 2016. The Ordinance, as originally drafted, became effective on July 11, 2016. The City Council subsequently proposed amendments to the original Ordinance. The amendments, which provide clarification about employers' options for providing paid sick leave and the enforcement process, will take effect on September 2, 2016. The Ordinance covers employees who perform at least two hours of work within the geographic boundaries of the City of San Diego. (A link showing the city's geographical boundaries can be found on the city's website: https://www.sandiego.gov/treasurer/minimum-wage-program.) Below is a brief summary of what San Diego employers need to know.

Minimum Wage

As of July 11, 2016, the effective minimum wage for the City of San Diego is $10.50 per hour. This will increase to $11.50 per hour as of January 1, 2017. As of January 1, 2019, and each year thereafter, the minimum wage increase will be tied to the Consumer Price Index.

Paid Sick Leave

Methods of Providing Paid Sick Leave

Per the original Ordinance, currently in effect, employers must provide employees with one hour of paid sick leave for every 30 hours worked. The original Ordinance did not allow employers to cap accruals. The new amendments, however, allow employers to cap paid sick leave accruals at 80 hours as of September 2, 2016. Employers may limit their employees' use of paid sick leave to 40 hours in a benefit year; however, any unused, accrued paid sick leave must be carried over to the following benefit year (subject to the applicable cap). Additionally, the new amendments allow employers to satisfy their paid sick leave obligations using an upfront grant method, whereby an employer provides 40 hours of paid sick leave at the beginning of each benefit year. Employers using this method would not have to comply with the accrual or carryover provisions of the Ordinance. Paid sick leave must begin to accrue at the commencement of employment or on July 11, 2016, whichever is later. Employees must be able to begin using accrued paid sick leave on the 90th calendar day of employment or July 11, 2016, whichever is later. Thereafter, employees may use paid sick leave as it is accrued. If an employer has an existing paid time off policy (such as a PTO or vacation policy) that satisfies the requirements of the Ordinance (including usage and accrual requirements), then it does not need to offer any additional paid time off. Employers need not pay out accrued, unused paid sick leave at termination. If an employee separates and is rehired within six months, however, the employer must reinstate any previously accrued, unused paid sick leave.

Permissible Uses of Paid Sick Leave

Employees may use paid sick leave for any of the following reasons:

  • If the employee is physically or mentally unable to perform his or her duties due to illness, injury, or a medical condition.
  • If the employee is absent for the purposes of obtaining professional diagnosis or treatment for his or her own medical condition.
  • If the employee's absence is for other medical reasons, such as pregnancy or obtaining a physical examination.
  • If the employee is providing care or assistance to a family member with an illness, injury, or medical condition, including assistance in obtaining professional diagnosis or treatment of a medical condition. For purposes of the Ordinance, "family member" means a child, spouse (which includes the employee's domestic partner), parent, grandparent, grandchild, sibling, or the child or parent of a spouse.
  • If the absence is for the employee's use of safe time. For purposes of the Ordinance, "safe time" means time away from work that is necessary due to domestic violence, sexual assault, or stalking.  An employee may use safe time for his or her own or a family member's need to obtain: medical attention to recover from physical or psychological injury or disability caused by domestic violence, sexual assault, or stalking; services from a victim services organization; psychological or other counseling; relocation; and/or legal services.
  • If the employee's place of business is closed by order of a public official due to a public health emergency, or the employee is providing care or assistance to a child whose school or child care provider is closed by order of a public official due to a public health emergency.

Notice Requirements

Employers will have new posting requirements under the Ordinance. Specifically, employers are required to post the new Minimum Wage Notice and Earned Sick Leave Notice and provide employees with an Earned Sick Leave and Minimum Wage Employee Notification Form. Notices can be found on the city's website at https://www.sandiego.gov/treasurer/minimum-wage-program. The city will update the Earned Sick Leave Notice and Notification Form once the amendments become effective in September. 

Prohibition on Retaliation and Remedies for Violations

The amendments also prohibit retaliation against employees for using paid sick leave and outline penalties employers may face for violations and remedies employees may seek, including but not limited to the payment of back wages unlawfully withheld, damages for denial of use of leave, reinstatement or other injunctive relief, attorneys' fees and costs, and liquidated damages (equal to double back wages withheld).

Next Steps

Employers should review their pay practices to ensure compliance with the new minimum wage increases. Employers should also review their paid time off policies to ensure compliance with the city's paid sick leave requirements. This is especially important for multi-state or multi-city employers attempting to apply a universal paid time off policy since San Diego currently has one of the country's highest required paid sick leave caps. Moreover, employers should also take the time to train their managers about the new paid sick leave requirements (in particular, the permissible reasons for taking paid sick leave and the prohibition on retaliation) to ensure that requests are not improperly denied or mishandled. Navigating the requirements of various applicable state - and city-specific paid sick leave laws can be challenging. As always, your Lewis Brisbois attorney can help you make sense of it all.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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