BILL ANALYSIS Ó
AB 1522
Page A
Date of Hearing: March 19, 2014
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Roger Hernández, Chair
AB 1522 (Gonzalez) - As Amended: March 13, 2014
SUBJECT : Employment: paid sick days.
SUMMARY : Requires employers to provide paid sick days, as
specified. Specifically, this bill :
1)Provides that an employee who works in California for seven or
more days in a calendar year is entitled to paid sick days as
specified in this bill.
2)Provides that an employee shall accrue paid sick days at the
rate of not less than one hour per every 30 hours worked,
beginning at the commencement of employment or the operative
date of this bill, whichever is later.
3)Provides that an employee shall be entitled to use accrued
paid sick days beginning on the 90th calendar day of
employment, after which the employee may use paid sick days as
they are accrued.
4)Provides that an "employee" does not include:
a) An employee covered by a valid collective bargaining
agreement that expressly provides for paid sick days or
similar policy, as specified.
b) An employees in the construction industry covered by a
valid collective bargaining agreement that was entered into
before January 1, 2015 or waives the requirements of this
bill, as specified.
5)Provides that "employer" includes the state, political
subdivisions of the state, and municipalities.
6)Provides that a public authority shall comply with these
requirements for individuals who perform in-home supportive
services, except that the public authority may satisfy these
requirements by entering into a collective bargaining
agreement that provides an incremental hourly wage adjustment
in an amount sufficient to satisfy the accrual requirements of
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this bill.
7)Provides that an employer shall provide paid sick days for the
following purposes:
a) Diagnosis, care, or treatment of an existing health
condition of, or preventative care for, an employee or an
employee's family member, as defined.
b) For an employee who is a victim of domestic violence,
sexual assault or stalking, as specified.
8)Provides that paid sick days shall carry over to the following
calendar year, but an employer may limit an employee's use of
paid sick days to 24 hours or three days in each calendar
year.
9)Specifies that an employer is not required to provide
additional paid sick days if the employer has a paid leave
policy or paid time off policy that meets the accrual
requirements and other purposes of this section, as specified.
10)Provides that an employer is not required to provide
compensation to an employee for accrued and unused paid sick
days upon separation from employment, except that if an
employee separates from employment and is rehired within one
year, previously accrued and unused paid sick leave shall be
reinstated.
11)Authorizes an employer to lend paid sick days to an employee
in advance of accrual, as specified.
12)Provides that an employer shall not deny an employee the
right to use paid sick days or engage in other adverse
employment actions, as specified.
13)Provides that there shall be a rebuttable presumption of
unlawful retaliation if any employer denies an employee the
right to use paid sick days or takes other specified adverse
action within 90 days of specified protected activities by the
employee.
14)Requires an employer to provide each employee with written
notice of these requirements, as specified.
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15)Requires the employer to retain records for five years
documenting an employee's hours worked and paid sick days
accrued and used, as specified.
16)Directs the Labor Commissioner to coordinate implementation
and enforcement of these requirements and to promulgate
guidelines and regulations.
17)Directs the Labor Commissioner to enforce these requirements,
and establishes administrative procedures, enforcement
actions, and administrative penalties, as specified.
18)Authorizes the Labor Commissioner, the Attorney General, a
person aggrieved, or an entity a member of which is aggrieved
to bring a civil action in a court of competent jurisdiction
to recover relief, as specified, including back pay,
penalties, liquidated damages and attorney's fees and costs.
19)Provides that these requirements do not limit or affect any
laws guaranteeing the privacy of health information, or
information related to domestic violence or sexual assault, as
specified.
20)Provides that these requirements shall not be construed to
discourage or prohibit an employer from the adoption or
retention of a more generous paid sick days policy.
21)Provides that these requirements do not lessen the obligation
of an employer to comply with a contract, collective
bargaining agreement, employment benefit plan, or other
agreement providing more generous sick days.
22)Provides that these requirements establish minimum standards
and do not preempt, limit or otherwise affect the
applicability of any other law, regulation, requirement,
policy, or standard that provides for greater accrual or use
of employees of sick days or that extends other protections to
an employee.
23)Makes related legislative findings and declarations of
legislative intent.
24)Makes related and conforming changes.
FISCAL EFFECT : Unknown
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COMMENTS : This bill is co-sponsored by the California Labor
Federation, AFL-CIO and the California State Council of Service
Employees.
Existing California law provides for various forms of unpaid and
(in some circumstances) paid leave for employees. Current law
does not, however, generally require employers to provide paid
sick leave, as that term is traditionally used. California law
does impose certain standards to the use of sick leave for those
employers who do provide it (such as "kin care" leave under
Labor Code Section 233) but there is not a general obligation
for employers to provide sick leave.
According to the author, this bill is necessary because nearly
40 million private-sector workers in the United States do not
have paid sick time. The author states:
"Taking unpaid sick time leaves workers vulnerable to
losing their jobs in an economy with a stubbornly high
long-term unemployment rate. Just 3 unpaid days off can
cost a family without access to paid sick days, on average,
its entire monthly grocery budget.
"Parents without paid sick days are twice as likely to send
a sick child to school, leading to a high likelihood of
delayed education development and poor health; they are
also five times as likely to take a child or family member
to an emergency room because of the inability to take time
off during the work day which may create extra financial
burdens associated with delayed health services."
Therefore, under this bill workers in California would accrue
one hour of paid sick leave for every 30 hours worked and
employers would have the option of capping an employee's paid
sick leave at 24 hours, or 3 days.
Similar Efforts at the National, State and Federal Levels
Paid sick days legislation has been proposed at the federal,
state and local levels. For several years, a federal Healthy
Families Act has been proposed that would ensure that all
employees working 30 or hours more per week have seven paid sick
days a year.
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In 2006, San Francisco voters approved Proposition F, the first
law in the nation that required workers with the ability to earn
and use paid sick days. In 2008, the District of Columbia
passed a paid sick leave ordinance that included paid "safe"
days for victims of domestic violence, sexual assault and
stalking. In 2011, Connecticut became the first state to pass a
statewide paid sick days law. Recent other cities that have
adopted paid sick days standards include Portland, New York
City, Jersey City and Newark. At least twenty-two states have
proposed legislation for paid sick days over the last several
years<1>.
Recent Pushback From Opponents of Paid Sick Days: "Preemption"
Legislation
In recent years, opponents of paid sick days legislation or
ordinances have begun to respond to the adoption of such
policies by pushing for the enactment of "preemption"
legislation that would bar any city or county within the state
from establishing a right to paid sick leave. In all, ten
states have enacted such preemption measures in recent years,
with seven states doing so in 2013. In 2011, the Wisconsin
Legislature not only prohibited localities from establishing
paid sick leave standards, but also retroactively abolished a
paid sick leave measure that had been established in Milwaukee
and was approved by 68 percent of voters in a 2008
referendum<2>.
The majority of these legislative efforts to preempt paid sick
leave policies have been sponsored by members of the American
Legislative Exchange Council (ALEC), and have reportedly been
based on model legislation proposed by ALEC<3>.
Recent Research on Paid Sick Days
---------------------------
<1> "State and Local Action on Paid Sick Days." National
Partnership for Women & Families (February 2014).
<2> Lafer, Gordon. "The Legislative Attack on American Wages
and Labor Standards, 2011-2012." Economic Policy Institute
(October 31, 2013).
<3> Id.
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According to a recent study<4> by the Economic Policy Institute,
American workers are more productive than ever before, but they
are less secure in their ability to provide for their families.
Workers without paid sick days-nearly 40 percent of the
private-sector workforce-are among the least economically
secure, and an illness forces them to take time away from work
without pay and puts them at risk of losing their job.
The study made the following findings:
Nearly 40 million private-sector workers do not have
paid sick time.
Employees without paid sick time are likely to go to
work sick, where they will have reduced productivity, at a
significant cost both to their employer and to their
possibility for professional advancement.
Without paid sick leave, parents are forced to send sick
children to school, which could potentially impact their
long-term health and educational performance.
A two-child family with two workers earning the average
wage for workers without paid sick time would lose the
family's entire health care budget after just three days of
missed work.
A two-child family with a single working parent earning
the average wage for workers without paid sick time
($10/hour) cannot miss more than three days of work in a
month without falling below the federal poverty line.
Taking unpaid sick time leaves workers vulnerable to
losing their jobs in an economy with a stubbornly high
long-term unemployment rate.
These findings were echoed by a recent Shriver Report<5> issued
by Maria Shriver and the Center for American Progress:
"Forty-two million women, and the 28 million children who
depend on them, are living one single incident-a doctor's
bill, a late paycheck, or a broken-down car-away from
economic ruin. Women make up nearly two-thirds of
minimum-wage workers, the vast majority of whom receive no
paid sick days. This is at a time when women earn most of
the college and advanced degrees in this country, make most
-------------------------
<4> Gould, Elise, Kai Filion and Andrew Green. "The Need for
Paid Sick Days: The Lack of a Federal Policy Further Erodes
Family Economic Security." Economic Policy Institute (June 29,
2011).
<5> Shriver, Maria and the Center for American Progress. "A
Woman's Nation Pushes Back From the Brink." (January 12, 2014).
AB 1522
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of the consumer spending decisions by far, and are more
than half of the nation's voters."
Another recent report<6> by the Institute for Women's Policy
Research focused on the potential impact of paid sick days on
the health of employees and their families. That report
presented the following findings:
Paid sick days are associated with better self-reported
general health among workers.
Workers with paid sick days are less likely to delay
medical care for themselves or for family members.
Access to paid sick days is associated with lower usage
of hospital emergency departments, a finding that holds
true for those workers and families with private health
insurance, those with public health insurance (e.g.
Medicaid or SCHIP), and those with no health insurance.
1.3 million hospital emergency department visits could
be prevented in the United States each year by providing
paid sick days to workers who currently lack access,
reducing medical costs by $1.1 billion annually, with over
$500 million in savings for public health insurance
programs.
Proponents of previous versions of this measure cited to various
additional studies and reports in their arguments in support of
paid sick days legislation. First, supporters contended that
lack of paid sick days is a public health hazard. They pointed
out that the Centers for Disease Control recommends workers who
are ill "stay home from work and school"<7> to prevent the
spread of disease in the community and workplace. However, they
argued that only 15 percent of food service workers in
restaurants and food processing plants have paid sick days<8>.
They also contended that the risk of occupational health hazard
is increased in industries without paid sick days, and noted
that 51 percent of all mining employees, 73 percent of
sanitation workers and nearly 500,000 manufacturing employees do
---------------------------
<6> Miller, Kevin, Claudia Williams and Youngmin Yi. "Paid Sick
days and Health: Cost Savings From Reduced Emergency Department
Visits." Institute for Women's Policy Research (November 2011).
<7> Centers for Disease Control website: www.cdc.gov
<8> Hartmann, Heidi, Ph.D., Public Testimony, February 2007
hearing on the federal Healthy Families Act.
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not have access to paid sick days<9>.
Proponents also argued that paid sick days reduce the costs of
employee turnover and claim that employees with paid sick days
are less likely to leave their jobs<10>. Every time an employee
leaves a job, it costs the employer 25 percent of a worker's
total compensation, on average, to replace that worker<11>.
ARGUMENTS IN SUPPORT :
Supporters of this measure, including the California Labor
Federation, AFL-CIO, argue that millions of workers in
California cannot take a day off when they or someone in their
family falls ill. Under current state law, nothing requires
employers to provide paid sick days, and as a result, roughly 39
percent of the workforce earns no sick leave benefits
whatsoever. That leaves seven million Californians with few
options when personal or family needs arise.
Supporters state that a worker without such leave is either
expected to work while sick, risking the health and safety of
co-workers and customers, or stay home and forego wages,
jeopardizing that worker's own ability to survive. This
impossible choice is as unfair as it is unnecessary and has no
place in today's economy.
They contend that this bill will grant all California workers
access to earned sick leave following 90 days of employment.
Employees will earn one hour of paid sick time for every 30
hours worked, and employers may cap available leave at three
days per year. Sick leave can be used to care for a sick family
member or as leave to allow domestic violence and sexual assault
survivors time to recover. The bill allows flexibility for
workers and employers covered by a collective bargaining
agreement, and the bill includes anti-retaliation language to
protect workers claiming this benefit.
---------------------------
<9> 2006 National Compensation Survey Analysis by the Labor
Project for Working Families
<10> Lovell V. "Valuing Good Health: An Estimate of Costs and
Savings for the Healthy Families Act." Washington, D.C. :
Institute for Women's Policy Research (2005).
<11> Employment Policy Foundation.. "Employee Turnover - A
Critical Human Resource Benchmark." HR Benchmarks. (December 3,
2002): 1-5.
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ARGUMENTS IN OPPOSITION :
Opponents, including the California Chamber of Commerce, argue
that while many employers voluntarily offer sick leave for
full-time employees, expanding this mandate on all employers
will create a huge burden on employers. For example, many
employers currently offer paid sick leave which accrues on a per
month or per pay period basis. However, this bill requires them
to completely change their existing policies in order to mirror
the accrual rate proposed under this bill. Opponents also
contend that the new posting and notice requirements, with
additional penalties for noncompliance, put employers at risk of
litigation.
Opponents raise particular concern about some of the enforcement
mechanisms contained in this bill, including the private right
of action. They contend that under this provision, a union may
file a lawsuit against an employer of behalf of an employee,
thereby significantly expanding the scope and threat of civil
litigation against small and large employers. Opponents also
object to various penalties contained in the bill, arguing that,
while an employee should be made whole for any violation of the
law, the layering of additional penalties, such as treble
damages, is simply an unjustified windfall. Opponents also
object to the bill's creation of a rebuttable presumption of
retaliation, arguing that the burden will fall on the employer
to prove that employment decisions were valid, instead of the
burden falling on the employee to prove retaliation.
Opponents also contend that recent employer surveys of
jurisdictions that have adopted paid sick leave policies
indicated a negative impact on growth and jobs:
"The Employment Policies Institute recently published a
limited study on the effects of Connecticut's Paid Sick
Leave law that went into place in 2012 and only applies to
larger employers and non-exempt service workers. Although
the survey was admittedly limited in the number of
businesses evaluated, the results indicate the new law has
had a negative impact on growth and jobs. Of the 156
businesses that responded to the survey, 31 of the
businesses had reduced other employee benefits to balance
the cost of the paid sick leave; 12 had reduced employee
hours; 6 had reduced employee wages; 19 companies had
raised their prices; 6 companies had laid off employees;
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and, 16 companies stated that they would limit their
expansion in the state. Thirty-eight of the businesses
surveyed also indicated that they would hire fewer
employees as a direct result of the new law, while others
stated they planned to offer fewer raises<12>."
Opponents conclude that rather than mandate new requirements,
the Legislature should incentivize employers to offer these
additional benefits by reducing costs in other areas. Among
other things, they suggest offsetting the burden on employers to
provide paid sick leave by providing small employers with a tax
credit for the amount expended each year on paid sick leave.
PRIOR LEGISLATION:
This bill is similar, but not identical to, AB 400 (Ma) from
2011. AB 400 was held in the Assembly Committee on
Appropriations.
This bill is also similar to AB 1000 (Ma) from 2009. AB 1000
was similarly held in the Assembly Committee on Appropriations.
This bill is also similar to AB 2716 (Ma) from 2008. That
measure was held in the Senate Committee on Appropriations.
REGISTERED SUPPORT / OPPOSITION :
Support
Alameda Labor Council
American Federation of State, County and Municipal Employees
California Catholic Conference
California Employment Lawyers Association
California Labor Federation, AFL-CIO
California Nurses Association
California Partnership to End Domestic Violence
California School Employees Association
California State Council of Service Employees International
Union
Consumer Attorneys of California
Health Officers Association of California
Numerous Individuals
---------------------------
<12> Saltsman, Michael. "Paid Sick Leave in Connecticut: A
Pilot Study of Businesses' Responses to the Law." Employment
Policies Institute (February 2013).
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Opposition
Acclamation Insurance Management Services
Air Conditioning Trade Association
Alhambra Chamber of Commerce
Allied Managed Care
Associated Builders and Contractors - San Diego Chapter
Associated General Contractors
Association of California Healthcare Districts
Association of California Water Agencies
Brawley Chamber of Commerce
Brea Chamber of Commerce
California Chamber of Commerce
California Association of Joint Powers Authorities
California Association of Licensed Security Agencies, Guards and
Associates
California Association of Winegrape Growers
California Attractions and Parks Association
California Beer & Beverage Distributors
California Business Properties Association
California Business Roundtable
California Chapter of American Fence Association
California Employment Law Council
California Fence Contractors' Association
California Grocers Association
California Hotel & Lodging Association
California Independent Grocers Association
California Manufacturers and Technology Association
California Newspaper Publishers Association
California Professional Association of Specialty Contractors
California Restaurant Association
California Retailers Association
California Special Districts Association
California State Association of Counties
California Travel Association
California Trucking Association
Chambers of Commerce Alliance of Ventura & Santa Barbara
Counties
Dana Point Chamber of Commerce
Desert Hot Springs Chamber of Commerce
El Centro Chamber of Commerce
Engineering Contractors' Association
Flasher Barricade Association
Fountain Valley Chamber of Commerce
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Fullerton Chamber of Commerce
Greater Bakersfield Chamber of Commerce
Greater Conejo Valley Chamber of Commerce
Greater Fresno Area Chamber of Commerce
Greater Riverside Chambers of Commerce
Greater San Fernando Valley Chamber of Commerce
Huntington Beach Chamber of Commerce
League of California Cities
Lodi Chamber of Commerce
Long Beach Area Chamber of Commerce
Marin Builders Association
National Federation of Independent Business
National Right to Work Committee
Orange County Business Council
Oxnard Chamber of Commerce
Palm Desert Area Chamber of Commerce
Plumbing-Heating-Cooling Contractors Association of California
Porterville Chamber of Commerce
Redondo Beach Chamber of Commerce
Rural County Representatives of California
San Diego East County Chamber of Commerce
San Jose Silicon Valley Chamber of Commerce
Santa Clara Chamber of Commerce and Convention-Visitors Bureau
Simi Valley Chamber of Commerce
Southwest California Legislative Council
Tahoe Chamber of Commerce
Torrance Area Chamber of Commerce
Turlock Chamber of Commerce
Urban Counties Caucus
Visalia Chamber of Commerce
Western Electrical Contractors Association
Wine Institute
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091