California continues its push to lead the country in providing workers with paid leave benefits. The latest expansion increases the amount of paid family leave from six to eight weeks in 2020. And an even bigger expansion is planned for 2021-22 as newly passed legislation creates a task force to propose an increase to a full six months for families by 2021-22! Read on for details of the newly amended law.
Eight Weeks of Paid Family Leave
Currently, California’s paid family leave law (also called the family temporary disability insurance) provides up to six weeks of wage replacement benefits to workers who take time off to care for a seriously ill child, spouse, parent, grandparent, grandchild, sibling, or domestic partner, 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. Beginning July 1, 2020, that paid leave entitlement goes up to eight weeks in a twelve-month period.
Under California’s paid family leave law (CA PFL), the twelve-month period, with respect to any individual employee, means the 365 consecutive days that begin with the first day the individual first establishes a valid claim for paid family leave benefits.
The bill specifically states that this enhanced leave benefit is only an initial step in increasing paid family leave to allow parents to bond with a new child. It notes that if each parent makes use of the additional two weeks of paid family leave benefits, families may collectively have an additional month to care for and bond with their newborn or newly adopted child. Remember too, that a birth mother may take an additional six to eight weeks of leave to recover from childbirth under California’s Disability Insurance program, further extending bonding time with her newborn baby.
The bill also impacts employers who choose to provides these benefits to employees through a voluntary disability insurance/paid family leave (CA VDI/PFL) policy. Because the law requires a CA VDI/PFL policy to be greater than the State’s PFL provisions, voluntary plan employers must update their existing policies and administration to ensure compliance by 2020 for the entitlement increase.
Additionally, employers who already offer a company paid leave or bonding program should consult their benefits consultants and counsel to determine how it may impact future offsets to benefits.
CA PFL provisions still do not provide job protection, only wage replacement. That means employees are only job-protected if their family leave runs concurrently with the federal Family and Medical Leave Act (FMLA) or California Family Rights Act (CFRA), to the extent employees are eligible under those laws.
Task Force to Propose Six Months of Total Leave
Perhaps more surprising than the two-week expansion of paid family leave benefits is the bill’s creation of a task force that will work with the Governor’s Office to develop a proposal to increase paid family leave even further. The proposal is clearly on a fast track, with a development deadline of November 2019. The proposal must assess and address job protections for employees, wage replacement rates up to 90 percent for low wage workers, and provide a plan to implement and fund expanded paid family leave benefits. The task force is expected to consult with representatives from employer groups, labor, early education representatives, other employment experts, as well as the Legislature when developing its proposal. The Governor’s Office then will present the task force’s findings and observations to the Legislature by November 2019 with the intent of the legislature passing expanded benefits effective 2021-22.
Before folks get too excited, please note that intended expansion appears to increase the amount of paid family leave to 12 weeks (three months) per employee. Consequently, if each parent takes their three months of paid family leave in succession, families would have a total of six months to bond with their new child. That is reflected in the language of the bill which states:
“The program currently provides parents with up to six weeks of paid leave to bond with a new minor child. Collectively, these paid leave benefits provide families with approximately three months of paid leave when used consecutively. The expansion of the program would double this availability to a total of six months so that infant children can stay with their parent or a close family member for the first six months of the child’s life.”
Therefore, CA PFL would increase incrementally, first from six to eight weeks effective July 1, 2020, with an anticipated future increase, if passed by the legislature, from eight to twelve weeks in 2021-22.
Don’t Forget Expansion for Qualifying Exigencies
As we’ve previously written, on January 1, 2021, CA PFL will expand in another way by adding a new reason for covered leave, namely qualifying exigencies related to the covered active duty or call to covered active duty of an employee’s family member in the U.S. Armed Forces. As mentioned above, this bill also impacts employers with a voluntary policy and requires compliance with this new leave reason by 2021.
What Employers Must Do Now:
California employers are responsible for complying with these changes in the CA PFL program in advance of their respective effective dates. Employers should:
- Update any employment policies, employee handbooks, or other leave-related documents that relate to California paid family leave to reflect the additional two-weeks of leave effective July 1, 2020, and to add military exigencies as a reason for leave effective January 1, 2021.
- If they have a voluntary disability and paid family leave policy, they should update their programs to reflect the additional two-weeks of leave effective July 1, 2020, and to add military exigencies as a reason for leave effective January 1, 2021.
- Work with their applicable vendors to ensure compliance with this new requirement.
- Train appropriate personnel, such as human resources, benefits, supervisors, managers, etc., on the upcoming changes in the California paid family leave law and how those changes might affect their workforce.
- Review company family/parental leave and bonding policies to determine if an increase to any offsets for the additional two-weeks of state-mandated leave will be required prior to July 1, 2020.
What ReedGroup Is Doing:
ReedGroup will update its platforms for Voluntary Plan administration in California to include the additional two weeks of leave and the new leave reason in advance of the effective dates. Our account services team will work with clients who have existing family/parental leave or bonding policies to understand the integration of benefits and any changes in offsetting calculations. We also will update LeaveAdvisor as well as notices and certification forms to reflect these changes.
If you’re looking for assistance managing claims or to ensure compliance across your organization, ReedGroup has solutions for you. Check out our offerings here.