This past Friday, on March 27, 2020, the Los Angeles City Council passed an ordinance that added a new Article 5-72HH to the Los Angeles Municipal Code (“Ordinance”) mandating COVID-19 Supplemental Paid Sick Leave. The City Council also passed other COVID-19-related local requirements, including mandates on grocery stores, renter evictions protections, and other matters. As explained below, the Supplemental Paid Sick Leave mandate is one that applicable larger employers must quickly become familiar with.
Applicable Employers
Importantly, this new article applies only to employers that have 500 or more employees nationally. The term “nationally” utilized here is important as it could have a major impact on employers that have a small workforce in the City of Los Angeles but a larger workforce in other parts of California, or even other parts of the United States. Notably, an employer of an employee who is either a “First Responder" or a health care provider is exempt from this article. The Ordinance, as amended, also provides an exemption for collective bargaining agreements, provided that the waiver is explicitly set forth in the agreement in clear and unambiguous terms.
This LA City Ordinance covers the employers that were not covered by the federal Emergency Paid Sick Leave Act (“EPSLA”), which addresses private employers with fewer than 500 employees as well as all public employers. However, while the federal EPSLA limits employers from having to bear much of the costs for the sick leave through a tax credit, this LA requirement provides no such relief for employers, many of whom are reeling from the economic impact of COVID-19.
While not much of a consolation, there is an “employer offset.” The offset states that the “Employer’s obligation to provide 80 hours of supplemental Paid Sick Leave under this article shall be reduced for every hour an Employer allowed an Employee to take paid leave in an amount equal to or greater than the requirements [in this article], not including previously accrued hours, on or after March 4, 2020, for any of the” four situations listed below. However, the provisions of this article are in addition to or independent of any other rights available to an employee, except for the rights and remedies provided to employees pursuant to the federal Families First Coronavirus Response Act (which includes the EPSLA).
Applicable Employees
An employee is entitled to Supplemental Paid Sick Leave under this new article if the individual has been employed with the same employer from February 3, 2020, through March 4, 2020, and performs any work within the geographic boundaries of the City of Los Angeles. This means employers with geographic locations outside of LA but that have employees who perform services and/or make deliveries/pickups in LA will have those employees covered. It also likely means that employers that do not have locations in LA but whose employees, during the COVID-19 crises, have been required or permitted to work remotely from their own residences that happen to be in the City of Los Angeles may be covered. Notably, under this article, an employee is presumed to be an employee and an employer has the burden to demonstrate that a worker is a bona fide independent contractor and not an employee. Moreover, an employee cannot waive these rights; any such waiver will be void and unenforceable. The article applies differently to full-time and part-time employees:
- Full-time employee: An employee who works at least 40 hours per week or is classified as a full-time employee by the employer will receive 80 hours of Supplemental Paid Sick Leave.
- Part-time employee: An employee who works less than 40 hours per week and is not classified as a full-time employee by the employer will receive Supplemental Paid Sick Leave in an amount no greater than the employee’s average two-week pay over the period of February 3, 2020, through March 4, 2020.
The Supplemental Paid Sick Leave per employee cannot exceed $511 per day and $5,110 in aggregate total (matching the maximum benefits under the EPSLA).
Situations in Which the Employer Must Provide an Employee Supplemental Sick Pay Leave
An employer must provide Supplemental Paid Sick Leave upon the oral or written request of an employee when the employee takes time off in the following four situations:
- A public health official or health care provider requires or recommends that the employee isolate or self-quarantine to prevent the spread of COVID-19.
- The employee is at least 65 years old or has a health condition, such as heart disease, asthma, lung disease, diabetes, kidney disease, or a weakened immune system.
- The employee needs to care for a family member who is not sick but whom public health officials or health care providers have required or recommended isolation or self-quarantine.
- The employee needs to provide care for a family member whose senior care provider or whose school or child care provider caring for a child under the age of 18 temporarily ceases operations in response to a public health or other public official’s recommendation.
Employers should be aware of the fact that an employer may not require a doctor’s note or other documentation from an employee for the use of Supplemental Paid Sick Leave.
Unless the City Council extends the article, the article will be in effect until December 31, 2020.
Significant Amendments Made Before Passing
The original proposed Ordinance was considerably more expansive than what was ultimately passed by the City Council. The original article would have applied to all employers, included another situation in which employers would have been required to provide the Supplemental Paid Sick Leave, and did not allow for parties to contract out of this article in their collective bargaining agreements. Nonetheless, after much discussion, the City Council scaled back the original proposed version of the article for the one described above.
Right to Recall (Just Cause Termination) Ordinance Tabled
The City Council also considered adding Articles 4-72J-A and 4-72J-B to the Municipal Code. Article 4-72J-A, “COVID-19 Right of Recall,” which, if eventually passed as it stood on Friday, would have a significant impact on many employers within the City of Los Angeles, essentially requiring all employee terminations to be justified by just cause and requiring certain employers to offer any position that becomes available to previously terminated or “laid off” workers. This proposed ordinance should be closely watched by any applicable employers as it could have major ramifications. One such ramification this ordinance currently contains, is that any termination occurring on or after March 4, 2020, will be presumed to have been due to a non-disciplinary reason that entitled the worker to be presumed “laid off” and entitled to reinstatement to any same or similar position available. A “laid off” worker who believes that the employer did not follow this requirement appropriately could seek a remedy in California state court, including punitive damages and attorneys’ fees. The way this ordinance is drafted arguably places the burden on employers to prove they justifiably terminated employees—a radical difference. Moreover, as it stands, this ordinance would remain in effect and apply to all terminations in the future until the City Council repealed it.
Ultimately, late on Friday night, the City Council decided that the Right to Recall was not an urgent matter and thus tabled the proposed article until a future meeting of the Council, with Council members noting they could impose these obligations in the future even with respect to previously terminated or “laid off” employees. Furthermore, there is a possibility that this article will be altered, as certain Council members indicated that they would attempt to amend the article. It is currently unclear when the Council will meet again, when or if this proposed Recall ordinance will be revisited, or how it may be amended.
What Los Angeles Employers Should Do Now
Applicable employers should be sure to follow the requirements of the ordinances that the City Council passed and provide applicable Supplemental Paid Sick Leave to Los Angeles employees.
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