Governor signs new COVID-19 sick leave legislation into law

Bill does not include direct funding to employers to offset sick leave costs or costs for testing

Gov. Gavin Newsom has signed a new COVID-19 sick leave bill, SB 114 (Committee on Budget and Fiscal Review), into law. The bill was introduced in the Legislature last week and requires employers, including public agencies with more than 25 employees, to provide up to 80 hours of supplemental sick leave to recover from COVID-19.

The Governor and legislative leaders reached an agreement on the new legislation two weeks ago. After announcing the deal, the bill was quickly introduced and sent to the Governor, allowing little time for stakeholders to review the legislation.

Under the new law, workers have access to at least 40 hours of supplemental sick leave, as well as an additional 40 hours if they show proof of a positive test result from themselves or a family member. This applies retroactively to Jan. 1, and sunsets on Sept. 30.

To access the first 40 hours of supplemental sick leave, the new law has the same qualifying reasons as last year’s SB 95 (Skinner), with the addition of the following:

• The covered employee is attending an appointment for themselves or a family member to receive a COVID-19 vaccine or the covered employee is experiencing COVID-19 symptoms.
• The covered employee is caring for a family member experiencing symptoms related to a COVID-19 vaccine that prevents the employee from being able to work or telework.
  

In a welcome addition, this new law requires wage statements to display the amount of time used instead of what is remaining. Another major change is that employers cannot require that the leave be exhausted before using leave available under the California Division of Occupational Safety and Health’s aerosol transmissible diseases standard. Additionally, employers must provide a COVID-19 test upon request by the employee.

Direct funding to cities and other local agencies to offset sick leave costs or costs for testing is not included in the new law. When the bill was originally introduced, a coalition of local government associations, including the League of California Cities, submitted a letter of concern to both legislative houses, noting the administrative and budget impacts the bill would have on local governments.

However, paying for the new supplemental paid sick leave is an eligible expense of American Rescue Plan Act funds. Moreover, as of Jan. 1, insurance companies must pay for the cost of COVID-19 testing. This may help offset some of the costs to local agencies.

While there is currently no state-level funding to offset these costs, during a floor speech on Monday Assembly Budget Chair Phil Ting said that lawmakers are negotiating a funding plan to offset expenses related to paid COVID-19 sick leave for small businesses in the absence of federal aid. This relief could be included in the June budget. Cal Cities will remain engaged in ongoing funding conversations and provide additional information as it becomes available.