BILL ANALYSIS Ó
SENATE COMMITTEE ON LABOR AND INDUSTRIAL RELATIONS
Senator Tony Mendoza, Chair
2015 - 2016 Regular
Bill No: SB 1166 Hearing Date: April 13,
2016
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|Author: |Jackson |
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|Version: |February 18, 2016 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Alma Perez-Schwab |
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Subject: Unlawful employment practice: parental leave
KEY ISSUES
Should the Legislature establish a parental leave policy
requirement for businesses of five or more employees that allows
workers to take up to 12 weeks of unpaid leave to bond with a
new child within one year of the child's birth, adoption or
foster care placement?
Should this parental leave policy include a guarantee of
employment upon the employee's return?
Should employers be required to pay for continued group health
coverage during the duration of the employee's parental leave?
ANALYSIS
Existing law:
1. The California Family Rights Act (CFRA) and the federal
Family and Medical Leave Act (FMLA), required to be taken
concurrently, entitles eligible employees of covered
employers (employers with 50 or more employees) to:
SB 1166 (Jackson) Page 2
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a. Take up to 12 workweeks of unpaid,
job-protected leave during a 12-month period for
specified family and medical reasons, including that
of bonding with a newborn, child adoption or foster
care placement, among others.
b. Guaranteed reinstatement to the same or
comparable position upon the return of the employee
from his/her leave.
c. Continued group health coverage during the
duration of the leave under the same terms and
conditions as if the employee had not taken the leave.
(Government Code §12945.2)
2. Establishes the State Disability Insurance (SDI) program
as a partial wage-replacement plan funded through employee
payroll deductions that is available (through the
Disability Insurance and Paid Family Leave programs) to
eligible individuals who are unable to work due to sickness
or injury of the employee (including pregnancy), the
sickness or injury of a family member, or the birth,
adoption, or foster care placement of a new child.
a. The Paid Family Leave program (PFL):
§ Provides eligible employees (those
paying into SDI) with up to 6 weeks of wage
replacement benefits to care for a seriously ill
child, spouse or registered domestic partner,
parent, siblings, grandparents, grandchildren,
and parents-in-laws or to bond with a minor child
within one year of the birth or placement of the
child in connection with foster care or adoption.
(Unemployment Insurance Code §3301)
§ Provides wage replacement equal to
one-seventh of the employee's weekly benefit
amount for each full day during which he or she
is unable to work (a wage replacement of
approximately 55 percent of lost wages).
§ Employers may require that
employees take up to two weeks of earned but
unused vacation when using PFL. The law does not
allow employers to require employees to use sick
leave.
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b. SDI does not provide job protection or return
to work rights.
c. SDI does not require continued group health
coverage during the leave.
1. Pregnancy Disability Leave (PDL), under the Fair
Employment and Housing Act, requires private employers with
five or more employees and public employers to provide up
to four months of unpaid, job-protected leave for
pregnancy, childbirth or related conditions.
a. Employees may use accrued vacation and paid
sick leave during PDL.
b. Employees are entitled to reasonable
accommodations and reinstatement to the job held
before PDL began.
c. Employers are required to continue the
employee's health coverage during PDL.
d. Prohibits employers from refusing to allow an
eligible employee to take PDL leave and thereafter
return to work.
(Government Code §12945)
This Bill would establish a new parental leave right of
specified employees to bond with a new child either through
birth, adoption or foster care placement.
Specifically, the bill would:
1. Prohibit an employer of five or more employees from
refusing to allow an employee, upon request, to take up to
12 weeks of parental leave to bond with a new child within
one year of the child's birth, adoption, or foster care
placement.
2. Require the employer to provide a guarantee of
employment in the same or comparable position upon return,
or otherwise be deemed to have refused to allow the leave.
3. Provide that the employee can utilize accrued vacation
pay, paid sick time, other accrued paid time off, or other
paid or unpaid time off negotiated with the employer,
during the period of parental leave.
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4. Require the employer to pay for continued group health
coverage for an eligible employee who takes parental leave
for the duration of the leave at the level and under the
conditions that coverage would have been provided had the
employee continued to work.
5. Specify that this parental leave shall run concurrently
with CFRA and FMLA, except for leave taken for a disability
on account of pregnancy, childbirth, or related medical
condition (PDL), and the aggregate amount of leave - or
combination of leaves - cannot exceed 12 work weeks in a 12
month period.
6. Specify that an employee is entitled to take Pregnancy
Disability Leave, in addition to the leave provided in this
bill, CFRA and FMLA, if he or she is otherwise qualified.
COMMENTS
1. Background on California Medical Leaves:
California has several medical leaves under which an employee
may be able to take time off of work to care for his or her
illness, that of specified family members or for the bonding
with a new child through birth, adoption or foster care.
However, each medical leave is unique and may or may not be
available to all employees. Below is a brief summary of some
of the leaves and their eligibility requirements.
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| | | | |
| | | | |
| CFRA/FMLA | | | |
| (Job Protected) | | | |
| PFL | | | |
| (No Job Protection) | | | |
| | | | |
| PDL | | | |
| (Job Protected) | | | |
| | | | |
| SB 1166 | | | |
| (Job Protected) | | | |
| | | | |
| | | | |
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|Employers Covered | | | |
| | | | |
| 50 or more employees in 75 mile radius of worksite | | | |
| | | | |
| One or more (employee pays, employee gets) | | | |
| | | | |
| Five or more employees | | | |
| | | | |
| Five or more employees | | | |
| | | | |
| | | | |
|Employee Eligibility | | | |
| | | | |
| Worked 1,250 hours in prior 12 months | | | |
| | | | |
| Once employee earns $300 in base period for fund contribution | | | |
| | | | |
| Immediate as necessary | | | |
| | | | |
| Immediate as necessary | | | |
| | | | |
| | | | |
|Reason for Leave | | | |
| | | | |
| Employee serious health condition; seriously ill family member | | | |
| care; bond with newborn or newly placed adopted or foster child | | | |
| | | | |
| Care for seriously ill family member; bond with a child within | | | |
| 1year of birth, foster care or adoption placement | | | |
| | | | |
| Disability due to pregnancy, childbirth or related medical | | | |
| condition | | | |
| | | | |
| Bond with a child w/in 1 year of birth, adoption or foster care | | | |
| placement | | | |
| | | | |
| | | | |
|Length of Leave | | | |
| | | | |
| 12 weeks in 12-month period | | | |
| | | | |
| 6 weeks in 12-month period | | | |
| | | | |
| Up to 4 months | | | |
| | | | |
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| Up to 12 weeks | | | |
| | | | |
| | | | |
|Paid or Unpaid | | | |
| | | | |
| Unpaid, may run concurrent with other paid leave | | | |
| | | | |
| Partial wage replacement | | | |
| | | | |
| Unpaid, may run concurrent with SDI for partial wage replacement | | | |
| | | | |
| Unpaid, employee can use vacation, paid sick time | | | |
| | | | |
| | | | |
|Continued Health Coverage | | | |
| | | | |
| Yes | | | |
| | | | |
| No | | | |
| | | | |
| Yes | | | |
| | | | |
| Yes | | | |
| | | | |
| | | | |
| | | | |
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2. Need for this bill?
As described above, California employees may be entitled to
several medical leaves depending on the size of their employer
and the reason for the leave. While CFRA and FMLA provide for
up to 12 weeks per year of unpaid job protected leave for an
employee who takes time for bonding or care, these protections
are only available to employees of businesses with 50 or more
workers. Employees of smaller businesses are entitled to take
Paid Family Leave and receive a partial wage replacement;
however, PFL does not offer any job protection which limits a
worker's financial ability to take the leave.
Studies have shown that paid family leave policies have
positive impacts on infant and maternal health, as well being
associated with greater labor force attachment and long-term
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productivity. A 2014 White House report by the Council of
Economic Advisers, titled "The Economics of Paid and Unpaid
Leave", reported the following:
"Paid leave policies can help business recruit talented
workers who plan to stay with a firm after having children.
In a survey of two hundred human resource managers,
two-thirds cited family-supportive policies, including
flexible schedules, as the single most important factor in
attracting and retaining employees. Paid leave has been
shown to increase the probability that women continue in
their job after having a child, rather than quitting
permanently, saving employers the expense of recruiting and
training additional employees. A review of 27 separate case
studies found that the median cost of replacing an employee
was 21 percent of that employee's annual salary - a
substantial cost that can be reduced with family-friendly
leave policies."
Although California's Paid Family Leave program is available
to all employees paying into the fund, the reality is that
without a guarantee of a job upon their return, most employees
do not take advantage of the program. A report from the Senate
Office of Research entitled California's Paid Family Leave
Program found that bonding leave claims ranged from no claims
to 10.2 claims per 1,000 people by county since the program
started. Additionally, since 2009, the proportions of bonding
claims filed were as follows: 94.3% were to bond with a new
biological child; bonding with adopted and foster children
made up less than 1% each (.35 percent and .31 percent,
respectively). Lastly, since 2004, the average bonding leave
taken by women is 5.17 weeks, while the average taken by men
has been 3.81 weeks.
The author and proponents believe this bill is needed to
ensure that no worker has to choose between the wellbeing of
their new child and their family's financial security. This
bill would establish a new parental leave right for employees
to bond with a new child either through birth, adoption or
foster care placement with the protection of a job upon
his/her return and a guarantee of continued group health
coverage during the duration of the leave. The existing PFL
program provides leave for this purpose, but it is not job
protected and does not require continued health coverage. The
author believes that these protections are necessary to
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encourage people to take the time necessary to bond with their
new family members.
3. Parental Leave Policies in Other States :
The United States is currently the only developed country in
the world that does not have any government sponsored paid
maternity or paternity leave law under which employees could
take time off to care for their loved ones. Availability of
such a leave is left at the discretion of each state and its
policies and employer practices. According to the U.S.
Department of Labor, only 12 percent of private-sector workers
have access to paid family leave through their employers.
Additionally, access is particularly low among low-wage
workers, Hispanics and African Americans. Many businesses have
voluntarily adopted leave policies, a trend most recently seen
in corporate America with companies like Microsoft offering up
to 20 weeks of fully paid parental leave.
The topic of paid family leave has also been a top priority
for the Obama administration, most recently in 2015, the
United States Secretary of Labor Tom Perez announced that the
Department of Labor Women's Bureau was awarding $1.55 million
in grants to research and analyze how paid family and medical
leave programs can be developed and implemented across the
country. According to Secretary Perez, "passage of a national
paid family and medical leave law is not a question of if, but
when. But as is so often the case on important public policy
issues, we need states and localities to be the incubators of
innovation. It's their efforts, which we're funding today,
that will pave the way for national reform. These grants will
get us closer to a future where working moms and dads can
focus on what really matters: time with their families."
Many States have taken action to address this need by enacting
statewide leave policies. Below is a summary of efforts
throughout the country.
Paid Leaves
Several states have mandated paid family leave programs
including California, New Jersey, Rhode Island and most
recently New York. When fully phased in, New York's paid
family leave program will provide the highest number of paid
time off between all states - 12 weeks - to help meet the
employee's family needs. Benefits will be phased-in beginning
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in 2018 at 50 percent of an employee's average weekly wage,
and fully implemented in 2021 at 67 percent of their average
weekly wage. This program will be job protected and funded by
employees who will be eligible to participate after having
worked for their employer for six months. California and New
Jersey both cover up to 6 weeks of leave time, while Rhode
Island only covers 4 weeks.
Unpaid Leaves
In terms of unpaid family leave rights, the following chart
outlines information gathered by the National Conference of
State Legislatures and offers a good summary of how California
compares to other states.
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|STATE |Employer Size |Length of Leave |
|--------------------+--------------------+--------------------|
|California (CFRA) |50 or more |12 weeks per year |
| |employees | |
|--------------------+--------------------+--------------------|
|Maine |15+ state/private; |10 weeks in 2 years |
| |25+local gov. | |
|--------------------+--------------------+--------------------|
|Minnesota |21 or more |6 weeks per year |
|--------------------+--------------------+--------------------|
|Oregon |25 or more |12 weeks per year |
|--------------------+--------------------+--------------------|
|Washington, D.C. |All public or |16 weeks per 2 |
| |private employers |years |
| | | |
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San Francisco - Parental Leave
On April 5, 2016, the San Francisco Board of Supervisors voted
unanimously to approve a measure (File# 160065) that would
require employers to help provide fully paid family leave for
new parents. In conjunction with California's existing Paid
Family Leave program, granting a 55% wage replacement for up
to six weeks, the SF ordinance would require businesses with
more than 20 employees to plug that gap by paying the
remaining 45% of their employees' wages. The law, when signed,
will take effect January 1, 2017 with a gradual phase in for
smaller businesses. Businesses with 35+ employees would be
required to comply by July 1, 2017. Businesses with 20+
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employees would have until January 2018. The measure requires
another formal vote by the board as well as approval by the
Mayor.
4. Double Referral :
This bill has been double referred and, if approved by this
committee, it will be sent to the Senate Judiciary Committee
for a hearing.
5. Proponent Arguments :
Proponents argue that while California is one of only four
states to offer paid family leave for new parents, it remains
impossibly out of reach for most low-wage earners and those
who work for small employers. They believe that this bill
would drastically improve access to parental leave for all
workers by addressing one of its biggest barriers - job
protection. According to the author, a field poll found that
almost 2 out of 5 employees who were eligible to use PFL, but
did not apply, chose not to because they feared losing their
job or other negative consequences at work [Unfinished
Business: Paid Family Leave in California and the Future of
U.S. Work-Family Policy (Ruth Milkman, Eileen Appelbaum
(2013)].
Proponents also note that studies have found that the ability
to use parental leave is far greater for salaried employees
(mainly managers and professionals) and high earners (those
earning over $20 per hour plus employer health insurance) than
for those in hourly and low-quality jobs. They argue that
existing protections for workers who need to take parental
leave are woefully inadequate, noting that CFRA and FMLA
provide 12 weeks of unpaid leave and job protection, but these
laws only cover employees who work for larger companies with
50 or more employees. This leaves over 40% of California's
workforce ineligible for job protected leave because their
employer is too small. Proponents argue that this
unconscionable exclusion affects these workers, their
families, as well as their employers, as many workers simply
must quit their jobs and find new employment following the
birth of their child.
At a time when financial security and healthcare coverage are
so important, the risk of losing one's job to take leave to
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care for a new child is simply a risk that many new parents
cannot afford to take. This legislation ensures that
California workers who have been paying into the Paid Family
Leave insurance program are able to use this benefit for
parental leave without risk of losing their job. The author
argues that no one should have to choose between the wellbeing
of their new child and their family's financial security.
6. Opponent Arguments :
Opponents argue that this measure will overwhelm small
businesses with as few as five employees by allowing an
employee who has only worked for the employer one day to
receive 12-weeks of protected parental leave, with the threat
of costly litigation for violations. Opponents argue that
while small employers must provide their employees with
pregnancy disability leave, they are not subject to FMLA or
CFRA because large employers are the ones likely capable of
accommodating such an extensive amount of time off. Both CFRA
and FMLA require an employee to work for one year and at least
1,250 hours before he or she can take a 12-week protected
leave of absence. This bill does not impose this same
requirement and such a mandate, they argue, is simply too
significant to manage.
Additionally, they argue that this lack of conformity creates
an opportunity for an employee to obtain over 24 weeks of
protected leave in one year. For example, an employee who has
only worked 800 hours could take the 12 weeks of leave under
this measure, return to work for another 450 hours, and then
take another 12 weeks of leave under CFRA and FMLA. Last
year, Governor Brown vetoed SB 406 (Jackson) based, in part,
on the fact that the legislation would "in certain
circumstances, require employers to provide employees up to
24 weeks of family leave in a 12 month period. I am open to
legislation to allow workers to take leave for additional
family members that does not create this anomaly." Opponents
believe that this bill creates this anomaly. They note that
while the bill tried to address this issue by stating that the
total amount of leave an employee can receive under this bill,
CFRA and FMLA is 12 weeks in a 12-month period, this does not
fix the situation because California cannot preempt or limit
the application of federal law under FMLA.
Opponents also argue that this bill labels an employer's
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failure to provide the 12-week leave of absence as an "unfair
employment practice," a label that exposes an employer to
costly litigation under the Fair Employment and Housing Act
(FEHA). An employee who believes the employer did not provide
the 12-weeks of protected leave, failed to return the employee
to the same or comparable position, or maintain benefits while
out on the 12-weeks of leave, could pursue a claim against the
employer seeking: compensatory damages, injunctive relief,
declaratory relief, punitive damages, and attorney's fees.
Opponents cite a 2015 study by insurance provider Hiscox
regarding the cost of employee lawsuits in California, ranking
our state as exposing employers to a 40% higher risk of a
discrimination claim than other states given its state
specific statute - FEHA. The study estimated that the cost
for a small to mid-size employer to defend and settle a single
plaintiff discrimination claim was approximately $125,000, an
amount which reflects the financial risks for employers.
Lastly, opponents argue that this bill is an unprecedented
mandate as they are unable to identify any other state that
imposes such an extensive leave of absence on employers with
only 5 employees and for employees who have worked only one
day for the employer. As set forth in a 2013 study for the
National Conference of State Legislatures, over 40 other
states impose only a 12-week leave of absence on employers
with 50 or more employees with the same hours worked
requirement as FMLA and CFRA. Of the remaining states that
differ, all have an employee size threshold or hours worked
requirement, or both, that is significantly higher than
proposed under this bill.
7. Prior Legislation :
AB 908(Gomez) of 2015/16: AB 908, among other things, would
revise the formula for determining benefits available pursuant
to the State Disability Insurance program and the Paid Family
Leave program to increase benefits to workers, as specified.
AB 908 was enrolled and is at the Governor's desk awaiting
signature.
SB 406(Jackson) of 2015: SB 406 would have expanded various
provisions under the California Family Rights Act (CFRA) to,
among others, include care for a child of a domestic partner,
sibling, grandparent, grandchild, domestic partner, or
parent-in-law. AB 406 was vetoed by Governor Brown.
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SB 770 (Jackson) Chapter 350, Statutes of 2013: broadened the
definition of family within the Paid Family Leave (PFL)
program to allow workers to receive the partial wage
replacement benefits while taking care of seriously ill
siblings, grandparents, grandchildren, and parents-in-law.
SUPPORT
California Employment Lawyers Association (Co-Sponsor)
Equal Rights Advocates (Co-Sponsor)
Legal Aid Society - Employment Law Center (Co-Sponsor)
Alliance for Community Empowerment
American Assn of University Women
American Civil Liberties Union of California
Breastfeed LA
California Asset Building Coalition
California Black Health Network
California Child Care Resource & Referral Network
California Domestic Workers Coalition
California Edge Coalition
California Hunger Action Coalition
California Immigrant Policy Center
California Labor Federation, AFL-CIO
California Latinas for Reproductive Justice
California Partnership
California Rural Legal Assistance Foundation
California Women's Law Center
California Work and Family Coalition
Career Ladders Project
Center for Popular Democracy
Center for WorkLife Law
Child Care Law Center
Children's Hospital Los Angeles
Common Sense Kids Action
Consumer Attorneys of California
Employment Lawyers Association
Equal Rights Advocates
Healthy Communities, Inc.
Mexican American Legal Defense and Education Fund
Mujeres Unidas y Activas
National Association of Social Workers, California Chapter
National Council of Jewish Women California
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Parent Voices
Raising California Together
The Opportunity Institute
Tradeswomen, Inc.
Voices for Progress
Western Center on Law and Poverty
Women's Foundation of California
9 to 5
3-Individuals
OPPOSITION
Associated Builders and Contractors of California
California Association of Joint Powers Authorities
California Chamber of Commerce
California Farm Bureau Federation
California Hotel and Lodging Association
California League of Food Processors
California Manufacturers & Technology Association
California Professional Association of Specialty Contractors
California Restaurant Association
California Retailers Association
Civil Justice Association of California
National Federation of Independent Business
Western Carwash Association
Western Growers Association
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