California DLSE Attempts to Clarify “No Accrual or Carry-Over” Option of Paid Sick Leave Law, Questions Remain

By Anne Cherry Barnett and Michele Haydel Gehrke

On August 7, 2015 the California Division of Labor Standards Enforcement (“DLSE”) issued an opinion letter attempting to clarify the minimum accrual and maximum use standards for employers who elect the lump sum “no accrual or carry-over” option for the new Healthy Workplaces, Healthy Families Act of 2014 (“Paid Sick Leave Act”).  While the opinion letter clarified these standards for “regular” worker schedules, it leaves open the appropriate application for those employees whose schedules fluctuate. 

An employer who elects to proceed under the lump sum “no accrual or carry over” compliance option with the Paid Sick Leave law must provide a minimum of 24 hours or three days of paid sick leave for employees, and the full amount of the leave must be received at the beginning of the year.  In simple terms, this means that an employee must be given three work days or 24 hours of paid sick leave at the beginning of the year, whichever amount is greater.   

Accrual of Paid Sick Leave

You might be scratching your head thinking, “but three days DOES equal 24 work hours??”  That is true for employees whose regular schedule is eight hours per day. 

But what if an employee works 10 hour shifts four days per week under an alternative work schedule, or works part-time shifts of six hours per day?  The DLSE opinion provides guidance on the practical application of the paid sick leave law in these circumstances when an employee works a regular schedule of more or less than an eight hour day. 

By illustration, if an employee works six hours per day, three days of work would equal only 18 hours, shorting the employee six hours of the minimum 24 hours of paid sick leave to which they are statutorily entitled.  Alternatively, if an employee’s regular schedule is 10 hours per day, then three work days would equal 30 hours---meaning that 24 hours of paid sick leave would be short six hours to allow that employee to take three full work days of paid sick leave to which they are statutorily entitled.  Accordingly, the DLSE opinion sets forth that three days/24 hours is the minimum paid sick leave required to be provided by employers and that employers must provide whichever amount is greater.  In the above examples, the employee working six hour shifts would receive 24 hours of sick leave (not 18 hours), and the employee working 10 hour shifts would receive 30 hours of sick leave (not 24 hours). 

Usage of Paid Sick Leave

Under the new Paid Sick Leave Law, an employer may also limit the use of an employee’s paid sick leave in any given year to three days or 24 hours.  Applying this use limitation is clear when an employee works eight hours per day.  However, if an employee works 10 hours per day, they will accrue 30 hours of paid sick leave under the statute, and the DLSE has now officially opined that these workers must be able to take the full amount of this leave to meet the maximum allowance of three days under the statute.  Likewise, an employee who works six hour shifts and receives 24 hours of paid sick leave must be allowed to use the full 24 hours of paid sick leave, even though this is the equivalent of four work days.

While the DLSE’s recent opinion may seek to clarify the practical application of the Paid Sick Leave Act for workers with traditional and regular schedules, the correct application of the law for employers who use flexible or fluctuating schedule arrangements for their employees still remains an open question.  However, the DLSE’s recent opinion confirms that employers must comport with the minimum standards in the statute calculated by how many hours an employee works in a single day, taking care not to deprive an employee of 24 hours or three days of paid sick leave, whichever is greater. 

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