On April 5, 2016, San Francisco became the first city/county in the U.S. to mandate that employers (with 20 or more employees) provide 6 weeks of supplemental compensation for paid paternal leave pursuant to the Paid Parental Leave for Bonding with New Child Ordinance. While this may not affect many Minnesota employers presently, certainly other cities and counties may follow in a similar fashion and so I thought readers may like to see how this particular ordinance plays out.
The Ordinance is effective January 1, 2017 (for employers with 50 or more employees), July 1, 2017 (for employers with 35-49 employees) and July 2018 (for employers with 20-34 employees). However, as the State of California already provides employees with 55% of their salary for up to 6 weeks for the care of newborns or newly adopted children under its state family leave insurance program, the California Paid Family Leave Act, employees working in San Francisco County (while the term “city” is used – the definition of the ordnance includes San Francisco County within the definition of “city” as the city is the only city within the county) will now be entitled to the remaining 45% from their employer (wherever located – including Minnesota). The weekly benefit amount uses the employee’s highest earning calendar quarter during an approximate 12 month base period – as of January 16, 2016 the maximum weekly benefit amount is $1,129.
Who Is Eligible for Paid Parental Leave in San Francisco?
An employee is eligible for paid paternal leave if even if they are part-time or temporary, so long as: (1) they have been working for the employer for at least 90 days prior to the start of leave; (2) performs at least 8 hours of work per week within San Francisco; (3) 40% of the weekly hours worked are within the geographic boundaries of San Francisco; and (4) is eligible to receive paid family leave under the California Paid Family Leave Act. If an employee’s weekly hours fluctuate, the Office of Labor Standards Enforcement (the “Agency”), will determine if the employee meets the 8 hour / 40% threshold by a variety of methods (too nit-picky for this post, but you can read in detail on the link above).
What If An Employee Works for Multiple Employers?
If an employee works for multiple employers, the paid leave supplemental compensation is apportioned between or among the employer based on the percentage of gross weekly wages from each employer. Notably, if one of the employee’s multiple employers is not subject to this Ordinance, the covered employer is only responsible for its percentage of the employee’s total gross weekly wages – in this case the employee will not actually receive 100% of his or her supplemental compensation amount. However, it is up to the employee to essentially tell a covered employer that there is also a non-covered employer, so I foresee this could be an issue with essentially self-reporting less entitlement. However, if the employee is caught, the covered employer has no obligation to pay any supplemental compensation to the employee under the ordinance.
Can an Employee Be Terminated While On Paid Parental Leave?
Yes – putting aside how suspect it looks, an employee terminated while on leave is entitled to the full 6 weeks, regardless of employment status. Additionally, an employee terminated before taking such leave, but after requesting or applying for California Paid Family Leave, raises “a rebuttable presumption that such termination was taken to avoid the Covered Employer’s Supplemental Compensation obligations” Ordinance at Sec. 3300H.4(b)(4). In other words folks, it just doesn’t look well or bode well for the employer absent very clear extenuating circumstances for the termination (theft, embezzlement, etc.).
Can Employers Force Employees To Use Paid Vacation or PTO?
No, but I see this is going to get messy as this section of the Ordinance could have been more clear. An employee may agree to allow the employer to use up to 2 weeks of accrued, unused vacation leave, but does not have to. If the employee does not agree, the employer “is not required to provide Supplemental Compensation under this Section 3300H.4” (it does not limit it to 2 weeks as one would have thought) but it doesn’t affect the employee’s California Paid Family Leave benefits. An employer may require an employee to take up to 2 weeks of vacation prior to the initial receipt of California Paid Family Leave, in addition to or in lieu of exercising the option. Not surprisingly, any employer that already provides for 6 weeks of paid leave need not provide supplemental compensation.
What If The Employee Quits Within 90 Days of Returning?
The employee must agree (by signing a form provided by the Agency), as a condition of receiving the supplemental compensation, to repay the employer the full amount if the employee quits within 90 days of returning from leave. However, the employer must request reimbursement in writing.
What Else Does the Ordinance Say?
The usual – employers must keep records, the Agency has access to the records, employers must not retaliate, it will be administered and enforced, it may be waived through collective bargaining, and is for the good of the public.
To our friends out West – good luck!