News & Events - Newsletters
Workplace Wave, November 2003
The following are exerpts from this month's newsletter.
California Employer Alert: Paid Family Leave Requirements Go Into Effect January 1, 2004
California is the first state to provide wage replacement benefits to employees for time off to care for a family member with a serious illness or for new child bonding time. The Paid Family Leave law goes into effect January 1, 2004 and will increase the State Disability Insurance (SDI) tax by .08 percent on all employees who work for private employers (regardless of size). Benefits are payable for leaves beginning on or after July 1, 2004. As with SDI, Paid Family Leave will be administered by the Employment Development Department. The EDD has issued proposed implementing regulations which provide some clarification on how the agency will administer the program. The following is based on the information available as of the date of this newsletter.
A. What the Law Covers
1. Employees who experience a wage loss due to their time off to care for a "seriously ill" family member, which includes a parent, child, spouse, or domestic partner. It may also include a child over the age of 18 if he or she is unable to care for himself or herself. "Seriously ill" must meet the definition of "serious health condition" under the California Family Rights Act (CFRA).
2. Employees who experience a wage loss due to their time off to bond with a new child. New child refers to the employee's new child or the new child of the employee's spouse or domestic partner, or a newly adopted or newly placed foster child of the employee or the employee's spouse or domestic partner. Eligibility for new child bonding expires at the end of the 12-month period that begins on the child's date of birth or placement.
The law covers part-time employees, provided they have paid into the SDI fund in a sufficient amount.
B. How the Benefits are Paid
Paid Family Leave benefits (also known as Family Temporary Disability Insurance) are limited to six weeks in a 12-month period. They will be paid in the same manner as under SDI. Weekly benefit amounts are the same as under SDI, subject to a seven consecutive calendar day waiting period. As with SDI, there is no minimum length of service eligibility requirement.
The 6 weeks of FTDI benefits does not need to be paid in one consecutive period. The law does not establish a minimum number of hours or days or weeks that an employee must take the time off, once the 7-day waiting period has occurred.
Eligibility requirements and the associated FTDI benefits appear to be payable only for full days off. The statute and regulations consistently describe the benefits in terms of "days" off, not time off or hours off.
Employers can require employees to use up to two weeks of earned vacation time before becoming eligible. Employers cannot require the use of sick leave in lieu of vacation for this purpose. The first week of vacation time can be used during the waiting period. The two weeks of vacation time can be paid at less than 100 percent.
Employees are not eligible for any day that another family member is able and available for the same period of time to provide the required care.
Employees are not eligible if they are receiving SDI, UI or workers' compensation benefits.
Consistent with SDI, sick leave wages are treated as wages such that FTDI benefits will be reduced by the amount of sick leave wages received. Employers may coordinate payment of sick leave with the FTDI benefits paid. However, if the employee receives the equivalent of full pay through the use of their sick leave credits, then they have not experienced a wage loss and are not eligible for FTDI benefits.
C. What the Law Does Not Do
The new law does not create any leave of absence, legally required time off or job reinstatement periods. Legal rights and protections under FMLA and CFRA are not changed or expanded. Rather, Paid Family Leave is a wage replacement benefit for employees who are taking time off for family leave purposes that may also be covered by FMLA/CFRA or other law.
D. Interplay with FMLA/CFRA and California Kin Care
Employers can require employees to take leave under FMLA and CFRA at the same time they are receiving FTDI benefits.
Neither the statute nor the proposed regulations address the relationship between kin care and paid family leave. Kin Care requires employers to allow employees to use sick time (up to the annual allotment) for their time off due to an ill family member or domestic partner. These absences may not result in discipline or termination (just like a leave of absence job reinstatement period).
For more information on this topic, Ms. Topliff is happy to provide a reprint of her interview by the Payroll Reporter upon request – .
Employer Notice Requirements
Employers must provide the EDD's informational brochure to new employees beginning January 1, 2004. Employers must also provide this brochure to employees who are taking time off from work on or after July 1, 2004 to care for a seriously ill family member or for new child bonding time.
Employers are not required to provide claim forms to employees. Employees can obtain them by contacting the EDD after April 2004. They will likely be available on the EDD's website.