BILL ANALYSIS Ó AB 304 Page 1 ASSEMBLY THIRD READING AB 304 (Gonzalez) As Amended June 18, 2015 2/3 vote. Urgency ------------------------------------------------------------------- |Committee |Votes|Ayes |Noes | | | | | | | | | | | | | | | | |----------------+-----+----------------------+---------------------| |Labor |5-1 |Roger Hernández, Chu, |Harper | | | |Low, McCarty, | | | | |Thurmond | | | | | | | |----------------+-----+----------------------+---------------------| |Appropriations |11-5 |Gomez, Bonta, |Bigelow, Chang, | | | |Calderon, Eggman, |Gallagher, Jones, | | | |Eduardo Garcia, |Wagner | | | |Gordon, Holden, | | | | |Quirk, Rendon, Weber, | | | | |Wood | | | | | | | | | | | | ------------------------------------------------------------------- SUMMARY: Makes a number of changes to legislation enacted last year related to paid sick days. Specifically, this bill: AB 304 Page 2 1)Provides that the definition of "employee" does not include specified retired annuitants. 2)Specifies that the law applies to an employee who works in California "for the same employer" for 30 or more days within a year. 3)Provides that an employer may use a different accrual method, other than providing one hour per every 30 hours worked, provided that the accrual is on a regular basis so that an employee has no less than 24 hours of accrued sick leave or paid time off by the 120th calendar day of employment or each calendar year, or each 12-month period. 4)Provides that an employer may satisfy the accrual requirements of this section by providing not less than 24 hours or three days of paid sick leave that is available to the employee to use by the completion of his or her 120th calendar day of employment. 5)Amends the law to provide that 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, the employer makes available an amount of leave applicable to employees that may be used for the same purposes and under the same conditions, and the policy satisfies one of the following options: a) Satisfies the accrual, carry over, and use requirements of the law. b) Provided paid sick leave or paid time off to a class of employees before January 1, 2015, pursuant to a sick leave AB 304 Page 3 policy that used an accrual method different than providing one hour per every 30 hours worked, provided that the accrual is on a regular basis so that an employee, including an employee hired into that class after January 1, 2015, has no less than one day or eight hours of accrued leave within three months, and the employee was eligible to earn at least three days or 24 hours within nine months. If an employer modifies the accrual method used in the policy it had in place prior to January 1, 2015, the employer shall comply with any accrual method set forth in existing law or provide the full amount of leave at the beginning of the year. This bill shall not prohibit the employer from increasing the accrual amount or rate. 6)Provides that specified sick leave or annual leave benefits provided to specified state employees by statute or the provisions of a memorandum of understanding meet the requirements of the paid sick days law. 7)Provides that an employer is not required to reinstate accrued paid time off to a rehired employee that was paid out at the time of termination, resignation, or separation of employment. 8)Provides that if an employer provides unlimited paid sick leave or unlimited paid time off, the employer may satisfy a specified written notice requirement of existing law by indicating on the notice or the employee's itemized wage statement that such leave is "unlimited." 9)Delays application of provisions related to the inclusion of the amount of paid sick leave available on itemized wage statements or separate writings until January 21, 2016, for employers in the broadcasting and motion picture industries. AB 304 Page 4 10)Provides that paid sick time for nonexempt employees shall be calculated in the same manner as the regular rate of pay for the workweek in which the employee uses paid sick time, whether or not the employee actually works overtime in that workweek. Paid sick time for exempt employees shall be calculated in the same manner as the employer calculates wages for other forms of paid time leave. 11)Provides that if the employee, in the 90 days of employment before taking accrued sick leave had different hourly pay rates, was paid by commission or piece rate, or was a nonexempt salaried employee, the rate of pay may be calculated by dividing the employee's total wages, not including overtime premium pay, by the employee's total hours worked in the full pay periods of the prior 90 days of employment. 12)Provides that an employer is not obligated to inquire into or record the purpose for which an employee uses paid leave or paid time off. 13)Provides that the provisions of this bill are severable, as specified. 14)Makes other related changes. 15)Contains an urgency clause. EXISTING LAW provides that an employee who, on or after July 1, 2015, works in California for 30 or more days is entitled to paid sick days for specified purposes, to be accrued at a rate of not less than one hour for every 30 hours worked. AB 304 Page 5 FISCAL EFFECT: According to the Assembly Appropriations Committee, this bill will result in savings to state and local governments due to the exemption of retired annuitants and other clarification of law related to accrual and provision of paid sick leave. COMMENTS: AB 1522 (Gonzalez), Chapter 317, Statutes of 2014, enacted the Health Workplaces, Healthy Families Act of 2014 to provide paid sick days to specified California employees effective July 1, 2015. AB 1522 was landmark legislation that extended the right to paid sick days to an estimated 6.5 million California workers. This bill makes a number of changes to the legislation passed last year. According to the author, this bill aims to improve and ease implementation of California's new paid sick leave law. Last year, AB 1522 was signed into law by Governor Edmund G. Brown - giving more than 6.5 million workers the right to accrue no less than three paid sick days a year. However, the passage of such a sweeping workplace benefit has spurred a robust public discussion regarding the implementation of the law. As such, the author wishes to clarify a handful of the law's requirements before the law goes into effect on July 1, 2015. Analysis Prepared by: Ben Ebbink / L. & E. / (916) 319-2091 FN: 0000982 AB 304 Page 6