Employer Alert: New San Francisco Law Requires Fully Paid Parental Leave
On April 5, 2016, San Francisco became the first city in the United States to mandate that employers provide fully paid parental leave. San Francisco will be enacting this gradually and by 2018, businesses with 20 or more employees will be required to comply.
Effective January 1, 2017, San Francisco businesses with 50 or more employees will be required to offer six weeks of fully paid parental leave for employees following the birth or adoption of a child. This applies to parents of either gender and to both full- and part-time employees. To be eligible, employees will need to have been employed by that employer for at least 180 days, work 8 or more hours per week, and spend at least 40% of their work week within San Francisco city boundaries. If an employee leaves his or her employment within 90 days of returning from leave, the employee must repay the benefit. Employees may also be required to use up all vacation days before assuming paid leave.
Currently, California pays 55% of an employee’s wages when he or she goes on leave after the birth or adoption of a child, or to care for a sick family member through the state’s Paid Family Leave program. The new law will require employers to fill in the gap by paying the remaining 45% of an employee’s salary while he or she is on this parental leave. While California’s disability program does not guarantee that an employee can return to his or her job after the leave has ended, the San Francisco law makes it illegal to fire an employee after taking parental leave.
If your business offers more than the benefits provided, you are exempt from this requirement. The law provides that if pending California state legislation increasing the amount the state pays from the Paid Family Leave program, is approved, San Francisco’s requirement will decrease accordingly. We will continue to keep you updated as to the status of the state’s pending legislation.
The law will be enacted in gradual phases for smaller businesses. So while the requirement for employers with 50 or more employees takes effect January 1, 2017, smaller business compliance begins 6 months later. Starting July 1, 2017, businesses with 35 to 49 employees must comply. By January 1, 2018, all small employers with 20 or more employees will be required to comply. Employers with less than 20 employees will be exempt. The new law does not apply to the federal, state or other municipal governments.
If you have questions about how this development impacts your business, please call our main number, 408-286-5800 or email one of Berliner Cohen LLP’s employment attorneys.
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