Federal, state, and local governments have responded to hardships the Coronavirus pandemic has wrought on businesses and their workers.  Employment-related measures include new and expanded paid leave programs, in part designed to mitigate disruptions caused by school closures and other “stay at home” requirements. 

The federal Families First Coronavirus Response Act (“FFCRA”), for example, requires certain employers to provide up to 80 hours of paid sick leave to eligible workers. However, that law applies only to employers with fewer than 500 employees.

California’s Governor Gavin Newsom recently signed an emergency Executive Order, No. N-51-20, creating a new, paid sick leave provision. “COVID-19 Supplemental Paid Sick Leave” (“CSPSL”) applies only to specific food-related industries and workers, and only for specifically identified reasons. In addition, it applies only to businesses with more than 500 employees, which are not subject to the FFCRA. 

CSPSL’s overall intent is to ensure California’s workers in critical food supply systems have access to sick leave. Here is a summary of its provisions.        

Covered Businesses

The Order includes within its provisions private sector employers and workers subject to Industrial Welfare Commission Wage Orders 3, 8, 13, and 14. These are food processing and agriculture-related wage orders.  In addition, the Order applies to workers who work in, or deliver from, “food facilities,” broadly defined in Health and Safety Code section 113789.

All types of business formations, including corporations, sole proprietorships, and partnerships, may be subject to the Order. Covered businesses are called “Hiring Entities” because CSPSL applies not only to employer-employee relationships, but also to “gig” workers, who serve in the covered industries and occupations.  The Order expressly calls out as covered businesses Delivery and Transportation Network Companies, as defined by statute. As stated, however, businesses with fewer than 500 employees, as measured under the new federal FFCRA regulations, are not covered.

Eligible Workers

Even when a Hiring Entity must provide CSPSL, only certain workers – whether employees or contractors – are eligible.  First, only “Essential Critical Infrastructure Workers,” exempt from the statewide “Stay at Home” Executive Order, No. N-33-20, are covered. Second, only workers who must perform their duties outside of their residence (such as delivery persons or food processing workers) may seek CSPSL. So, for example, administrative personnel who perform their duties at home would not qualify for CSPSL.  If a worker is otherwise eligible, however, there is no length of service requirement.

Terms of CSPSL

Covered “Hiring Entities” must provide up to 80 hours of CSPSL. Those workers the Hiring Entity classifies as “full time,” or who worked 40 hours per week in the two weeks preceding the leave request, are entitled to the full 80 hours. Part-time workers’ entitlement is based on their normally scheduled hours, or based on a calculation, if the work schedule is irregular. 

Reasons for CSPSL include a federal, state, or local “isolation or quarantine” order, or a healthcare provider’s instructions, precluding work. The Order does not specify that an “isolation or quarantine” must be due to the worker’s actual illness, however. In addition, CSPSL is available to those workers who are prohibited by a Hiring Entity from working due to “health concerns” related to transmission of Coronavirus.

There is no provision in the Order for medical or other documentation of the need for CSPSL. Nor is there a provision allowing Hiring Entities to require a doctor’s release to return to work.

The worker decides how much of the available CSPSL to take. A Hiring Entity may not require a worker to use other paid or unpaid leave e.g., vacation, PTO, etc., before using CSPSL. However, if an employer’s paid leave program is more generous than the CSPSL Order provides, the employer may offer its own paid leave in lieu of CSPSL.

CSPSL is available during the pendency of statewide “stay at home” orders, such as Executive Order N-33-20.  But anyone already taking CSPSL when the “stay at home” order expires may exhaust any remaining CSPSL before returning to work. Finally, Hiring Entities must post or disseminate to workers a notice regarding the right to CSPSL.

Compensation

Similar to the federal FFCRA’s paid sick leave benefit, CSPSL must be paid at the higher of (1) the worker’s “regular rate” of pay during the pay period preceding CSPSL or (2) the applicable state or local minimum wage.  However, the CSPSL benefit is capped at $511 per day, or $5110 for the entire period of leave.

Enforcement

The Order authorizes the Labor Commissioner to enforce CSPSL under California’s paid sick leave statute. That is, even non-employee workers may file complaints with the Labor Commissioner and will be deemed “employees” for enforcement purposes. The Order also appears to authorize a civil action under the Unfair Competition Law. Remedies under the UCL are limited to injunctive relief and restitution, such as back pay.

Other Sick Leave Laws

CSPSL is in addition to paid sick leave mandated by California law, including Labor Code section 246, or local ordinances.  Therefore, employers subject to CSPSL must consider whether local ordinances or state law provide for additional paid sick leave. Some Hiring Entities and workers in relationships other than “employer-employee” may not be covered by existing state and local sick leave rules.

The Order does not address issues such as whether “essential workers” may take CSPSL if they are not ill, but merely precluded from working; or if workers will rush to take their entire CSPSL allotment once the state announces rescission of the “stay at home” mandate.  In addition, it is unclear for now whether there will be legal challenges to the Governor’s authority to create legal remedies without the Legislature’s input.

For now, Hiring Entities must carefully determine their obligations under California’s myriad paid leave laws and ordinances, and should consult counsel before determining whether to deny paid sick leave.