California has passed new legislation effective this year that expands coverage past what both Federal FMLA and the California Family Rights Act (CFRA) provide to new parents.
The new law took effect on January 1, 2018 and will provide up to twelve weeks of protected leave for new parents. The purpose of this article is to cover what employers should understand about the new act and how to be prepared.
The New Law:
The new law will cover about sixteen percent of California’s workers and state officials say will exclude about ninety percent of California businesses, namely those with under twenty employees. In short, only employers with twenty or more employees are mandated by this law.
California’s new Parental Leave Act (PLA) provides up to twelve weeks of leave for new parents. This includes parents who have given birth to a child and parents who have had a child placed with them through foster care or adoption.
It does not offer medical leave so employees that are covered under the new act cannot take time for their own medical needs nor for a family member’s needs. Covered employees can use the leave within the first 12 months after becoming new parents.
Employers must provide employees with a guarantee of the same or similar job upon the employee’s return before the employee starts the leave. If the employer does not provide this guarantee, then the employer is considered to have denied leave to the employee.
In addition, employers must provide group health insurance coverage for the twelve weeks that employees are on leave. Employers can only recover the cost of the health insurance premiums if the employee fails to return to work after the leave unless the employee did not return due to a serious health condition. If the employee fails to return to work due to a serious health condition or the employee does return to work, then the cost of the premiums must be borne by the employer.
Employees Covered Under the Parental Leave Act
The act covers any employer who has at least twenty employees in a seventy-five-mile radius. CFRA covers any employer who has fifty or more employees and does not include a seventy-five-mile radius requirement.
Employees who work at qualified employers must have worked at their employers for the previous twelve months. Further, employees must have worked at least 1,250 hours with their employers during that time frame.
In addition, the State of California, all cities and all subdivisions of the state or city governments fall under the act.
Differences between the Parental Leave Act and the Existing Family Right Act
The Parental Leave Act expands coverage under the Family Rights Act. While the Family Rights act covers employers of fifty or more, the Parental Leave Act also covers employers with twenty to forty-nine employees.
Furthermore, the CFRA covers leave for medical or serious health conditions of the employee and the employee’s family. CFRA expands the coverage of the Federal FMLA, which covers employers with at least fifty employers in a seventy-five-mile radius. CFRA also provides expanded coverage for family members above what FMLA provides.
In contrast to CFRA, California Pregnancy Disability Leave provides up to 4 weeks of paid leave for employees who are disabled due to pregnancy, including birth. The new act does not specifically address whether Pregnancy Disability Leave should be taken concurrently with New Parental Leave or consecutively.
The new law applies only to medium sized firms but in our experience many companies slip into the error of expanding the number of employees without realizing that at certain numbers additional obligations are imposed which can expose the employer to significant liability and penalties if ignored. Thus, once one reaches ten, twenty, fifty and a hundred employees, it is vital to understand what additional obligations may attach to that number of employees and adjust methods and benefits accordingly, being proactive and not reactive.