Governor and state lawmakers reach deal on paid COVID-19 sick leave

Gov. Gavin Newsom and legislative leaders reached an agreement on new COVID-19 sick leave legislation similar to SB 95 (Skinner), which was enacted in March 2021 and expired Sept. 30, 2021.

The new policy would apply retroactively to Jan. 1, 2022, and would sunset on Sept. 30, 2022. The agreement would require employers — including public agencies — with at least 26 workers to provide up to 80 hours of supplemental sick leave to recover from COVID-19. Workers would 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.

Employers would also need to provide 24 hours of sick leave for workers recovering from the side effects of receiving a COVID-19 vaccine. Additionally, employers would have to pay for and provide a COVID-19 test upon request by the worker.

The agreement does not include direct funding to employers to offset sick leave costs or costs for testing. Instead, the proposal provides tax breaks to businesses. Corporate and individual taxpayers with at least $1 million in business income will again be allowed to deduct operating losses.

California would also raise a $5 million limit on tax credits for businesses. This does little to address the costs this will have on cities and other local agencies. Local governments will have to absorb the new costs and must ensure that tests are available for their employees. More details about the proposal should be available in the coming days.

In his January budget proposal, the Governor also included $214 million in early action funding to maintain and expand testing operations and $362 million for testing for 2022-23, which could come as early as next month.