United States: San Francisco Employers Required To Offer Paid Sick Days

Existing state law in California does not require employers to provide employees with any paid sick leave. But a new ordinance, passed overwhelming by San Francisco voters on November 7, 2006, requires all employers with employees within the geographic limits of the city and county of San Francisco to provide paid sick leave. The far-ranging ordinance requires virtually all employers to provide paid sick leave to all employees, including part-time and temporary employees, and participants in Welfare-to-Work programs. An "employer" is also broadly defined to include any person who directly or indirectly or through an agent, including a temporary services or staffing agency, employs or exercises control over the wages, hours or working condition of an employee. The law takes effect on February 5, 2007.

Under the new ordinance, an employer is required to provide one hour of paid sick leave for every 30 hours worked. Sick leave need not begin to accrue until 90 days after the commencement of employment. Employers who qualify as "small businesses," who employ fewer than 10 employees during a given week, may adopt an accrual cap of 40 hours of paid leave. Larger employers may cap the accrual at 72 hours of paid leave. Accrued sick leave must carry over from year to year, subject to these caps, but an employer is not required to pay out unused leave on termination of employment. If an employer has an existing sick leave policy that meets or exceeds these requirements, the employer is not required to provide additional paid sick leave.

Sick leave may be used for the employee’s own illness or injury or to seek medical care, and also to aid or care for a child, parent, legal guardian or ward, sibling, grandparent, grandchild, spouse or registered domestic partner. If the employee has no spouse or registered domestic partner, he or she can designate a person as to whom the employee may use paid sick leave to aid or care for that person. Once an employee has completeD 30 hours of work after the 90 day waiting period, the employee must be given 10 work days to designate such a person, and the employee must be given the opportunity to change the designation annually thereafter. In contrast to existing state law which requires employers to permit up to half of employees annual sick leave accrual for "kin care," the ordinance allows all accrued time to be used for this purpose. An employer may take reasonable measures to verify that an employee’s use of sick leave is lawful.

The ordinance requires all employers to post a mandatory notice of rights in English, Spanish, Chinese, and any language spoken by at least 5% of the employees at the workplace. The City’s Office of Labor Standards Enforcement is to publish and make available a suitable notice by February 5, 2007. Employers must retain records documenting hours worked and paid sick leave taken for a period of four years. If the records are not properly kept and an issue arises as to an employee’s entitlement to paid sick leave, it will be presumed that the employer has violated the ordinance absent clear and convincing evidence to the contrary.

The ordinance provides for both administrative enforcement through the San Francisco Office of Labor Standards Enforcement, and a right to bring a civil action by the City Attorney and affected employees. Remedies include penalties equal to three times the amount of paid sick leave withheld (or $250 if greater), reinstatement, back pay, interest and attorney’s fees and costs.

The ordinance specifically prohibits employers from taking any adverse action against an employee who exercises his or her rights under the ordinance, even if the employee mistakenly but in good faith claims a violation. Any adverse action taken within 90 days of an employee’s exercise of rights under the ordinance creates a rebuttal presumption of employer retaliation.

Employers with workers in San Francisco should immediately review their current sick leave policy to determine whether it complies with the new law. No action is required if the current policy meets or exceeds the requirements of the ordinance. If the current policy does not comply (or if the employer has no policy), a new policy must be put in place by February 5, 2007. Payroll and record-keeping practices should also be reviewed to make sure they are in compliance. Employers with employees located both in San Francisco and other locations will have to decide whether to limit their policy to San Francisco, or extend the same benefits to employees at all locations.

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