Additional Employer Requirements Under San Francisco Paid Parental Leave Ordinance

In California, employees can apply for paid family leave (PFL) benefits administered through the California’s Employment Development Department (EDD).  These PFL benefits are funded through employee-paid payroll taxes, and provide eligible employees with six (6) weeks of partial wage replacement.  No state-wide law requires that employers offer paid parental leave.

San Francisco, however, has enacted a local ordinance, the San Francisco Paid Parental Leave Ordinance (SFPPLO), which requires that covered employers supplement an employee’s PFL benefits.  As of January 1, 2018, the SFPPLO applies to any San Francisco-based employer with 20 or more employees worldwide.  Thus, any employer with more than 20 employees would need to offer eligible employees who work in San Francisco with fully paid leave that complies with the SFPPLO and would need to revise its parental policy accordingly.

Under the SFPPLO, eligible employees working in San Francisco are entitled to 6 weeks of fully paid leave to bond with a new child (newborn, adoptive, or foster child).  An employee is eligible under the SFPPLO if he/she:  (1) works in San Francisco; (2) commenced work for a covered employer at least 180 days before the leave period; (3) works at least 8 hours/week in San Francisco for a covered employer; (4) works in San Francisco at least 40% of weekly hours for a covered employer; and (5) applies for and receives California PFL benefits from the EDD.

California PFL benefits provide an employee with 60% to 70% of an employee’s weekly wages (up to a cap) for up to 6 weeks.  Yet under the SFPPLO, companies with 20 or more employees worldwide would need to pay their San Francisco employees–provided they meet the above eligibility requirements–the difference between the employee’s weekly California PFL benefit and the employee’s normal gross weekly wages so that the employee receives up to 100% of his/her weekly wages (subject to a weekly maximum benefit amounts) for up to 6 weeks.  In addition, eligible employees must be allowed to take SFPPLO leave either consecutively or intermittently.

California New Parent Leave Act (NPLA)

California recently enacted a new law (California New Parent Leave Act) that expands coverage past what both the Family Medical Leave Act (FMLA) and California Family Rights Act (CFRA) provide to new parents.  Beginning on January 1, 2018, a California employee is eligible to take up to 12 weeks of unpaid, protected leave in a 12-month period to bond with a new child within one year of the child’s birth, adoption, or foster care placement if he/she (1) has worked for the Company for at least 12 months, (2) has at least 1,250 hour of service in the last 12 months, and (3) works at a location that has at least 20 employees within a 75-mile radius.  If an employee is eligible to receive leave under FMLA or CFRA, then they do not get this leave too.

Under the Act, employers must provide employees with a guarantee of the same or similar job upon the employee’s return. Additionally, the guarantee must be given prior to the start of the leave. Failing to provide a guarantee is considered the same as denying leave to the employee.

Employers with 20-49 employees are covered by this Act, which expands the CFRA’s original coverage of employers with 50 or more employees. Mid-size companies may need to update its policies/handbook to reflect this new law.

Next Steps

1. Post the PPLO poster in an area where employees can see it. You can download this poster here.  This poster must be displayed at each workplace or job site.

2. Employers must provide the San Francisco Paid Parental Leave Form to employees in San Francisco, and employees must complete and submit the form to their employer to receive supplemental compensation. This form is available in English, Spanish, and Chinese.

3. Calculate how much leave is owed to the employee by using these step-by-step instructions.

4. Use this Excel spreadsheet to calculate the amount of Supplemental Compensation a Covered Employer must pay to a Covered Employee.

(*Note that the above documents are provided by the San Francisco Office of Labor Standards Enforcement, and are subject to change at any time.

Employers should update their policies and Employee Handbook to reflect these new laws, and make it a habit of updating their Employee Handbooks annually. Employers with offices in more than one state should consider a separate Handbook that caters to the many nuances in California employment law.

The Grady Firm, P.C. attorneys specialize in helping businesses grow and succeed through employment, business, and immigration law advising for clients in California.  They help perform personnel audits, draft/revise Employee Handbooks, train employers on employment law compliance, provide on-demand legal analysis for hiring and firing questions, and provide leadership and sexual harassment training in English and Spanish.

To learn more about ensuring your business is compliant with state and local laws, schedule a complimentary 15-minute consultation with The Grady Firm’s attorneys; call +1 (949) 798-6298; or fill out a Contact Request Form.

*This article is for informational purposes only, and does not constitute legal advice or create an attorney-client relationship. This article does not make any guarantees as to the outcome of a particular matter, as each matter has its own set of circumstances and must be evaluated individually by a licensed attorney.

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