Santa Monica Paid Sick Leave Ordinance takes effect Jan 1 2017 with annual changes.

Santa Monica Paid Sick Leave Ordinance takes effect Jan 1 2017 with annual changes.

Santa Monica jumps on the slew of minimum wage and paid sick leave ordinances spreading across the State of California. Despite state regulations, which implemented sick leave laws state-wide, Santa Monica has put into law a wider and higher awarding system of sick leave laws. Flanked by Los Angeles, Santa Monica has placed a portion of their minimum wage increases dependent on what LA sets rates at. Although passed in 2016, the Santa Monica Paid Sick Leave Ordinance doesn’t go into effect until Jan 1, 2017. The purpose of this article is to provide a guide for business owners who reside or employ workers in the City of Santa Monica. For additional guides regarding

Santa Monica  Minimum Wage Scheduled Increases

Santa Monica aligned their wages with the wages set for the City of Los Angeles. In the ordinance there are three categories of employees. Those employed by a small business, less than 25 employees, large businesses employees with over 25 employees, and hotel workers. Employees are eligible for minimum wage if they work more than 2 hours or more in a week in the City of Santa Monica. All non-exempt hotel workers are also eligible. It’s important to note that the city considers the total number of employees for an employer and doesn’t consider each location to be a separate employer.

Below is a schedule of the minimum wage for employees:

Effective Date Non Hotel >25 workers Non Hotel <25 workers Hotel Workers
July 1 2016 $10.50 $13.25
July 1 2017 $12.00 $10.50 Match the hourly wages set for the Hotel Workers in the City of Los Angeles
July 1 2018 $13.25 $12.00 Match L.A.
July 1 2019 $14.25 $13.25 Match L.A.
July 1 2020 $15.00 $14.25 Match L.A.
July 1 2021 $15.00 Match L.A.
July 1 2022 Indexed Indexed Match L.A.

The minimum wages from 2022 and forward will be based on the Consumer Price Index. This mirrors the way that Los Angeles will set their minimum wage prices moving forward also. Santa Monica will announce the new minimum wage at the beginning of the year and they will be effective on July 1st of the same year.

Two-Part Phase of Paid Sick Leave Ordinance.

The Santa Monica Paid Sick Leave Ordinance has two phases built into it. Phase I takes effect Jan 1, 2017. Phase II takes effect Jan 1, 2018. In addition to providing a more comprehensive paid sick leave plan for employees, it also offers incremental minimum wage increases. Santa Monica breaks businesses down by small and large businesses. Small businesses are businesses with less than 25 employees. Large businesses are considered any business that employs over 25 employees.

Coverage of Paid Sick Leave

The Sick Leave Ordinance covers all employees who work inside of Santa Monica city limits for 2 hours a week or more. This includes all temporary, part-time, transitional employees, and others.

Exceptions to the Sick Leave Ordinance

The only exception to mandatory sick leave laws include employees that are covered by a union agreement if that agreement expressly waives their rights in clear language. The second set of employees that are excluded are employees of government agencies. This includes federal and state agencies, cities, counties, school districts and all other public entities.  Otherwise, the ordinance covers all employees. Its also important to note that Hotels that are in financial turmoil can apply for a one year waiver with the City of Santa Monica.

Sick Leave Accrual and Usage Limits

The City of Santa Monica has much broader coverage for paid sick leave than the recently passed California State Sick Leave Laws. Employers are allowed to accrue sick leave at the rate of 1 hour for every 30 hours worked. Large employees must allow employees to accrue and use up to 40 hours of paid sick leave during phase one of the ordinance. During phase two, they must allow employees to accrue and use up to 72 hours of paid sick leave. Small employers must allow employees to earn and accrue 32 hours of paid sick leave during phase one. During phase two, small employers must allow employees to earn and accrue up to 40 hours of paid sick leave in a year.

Unlike the California provisions which allow an employer to limit the annual usage of paid sick leave, the Santa Monica ordinance prohibits employers from limiting sick leave use. Employees must be allowed to use all accrued sick leave in a year. Once the employee has reached the maximum sick leave accrual hours for the year, the employee stops accruing sick leave.

Rolling Paid Sick Leave

Additionally, employees can roll unused sick leave to the next year. The max amount of rolled sick leave is limited to the annual accrual amounts. That means that employees would be allowed to roll up to 72 or 40 hours of sick leave during phase two of ordinance. The Santa Monica Paid Sick Leave Ordinance does allow for employers to have more generous sick leave plans.

Front Loading Paid Sick Leave

Front Loading is allowed by the Santa Monica Ordinance, but there are no provisions that allow for lower amounts of sick leave awards. If an employer decides to front load paid sick leave for employees, then they must front load consistent with the required accrual methods.

90 Day Probationary Period

Santa Monica allows for employees to start accruing sick leave from the beginning of their employment. However, employers are allowed to limit or restrict sick leave usage during the first 90 days of employment. This probationary state falls in line with the California 90 day probationary period and creates no additional conflicts for businesses.

State Learners are allowed 85% of the minimum wage

State law defines employees who are learners under Labor Code Section 1192. For those employees, they are allowed to be paid at 85% of the minimum wage for the first six months of employment or the first 480 hours of employment, whichever comes first. This was added by the city council as an incentive for businesses to continue to employee students in their organizations.

Sick Leave Allowable Usages

Santa Monica’s Paid Sick Leave Ordinance complied and mirrors California State Law in sick leave usage allowances. State law provides for sick leave to be used for diagnostic care, treatment of illness, or preventive care. This includes both serious and short term illness. That means that employees are allowed to take sick leave for common flues and other short term illness.

It allows for the employee to receive these services or to take time off to help a family member receive the services. In addition, state law also allows employees to use sick leave to obtain legal, medical, or counseling services related to domestic violence, stalking or sexual assault. It allows for the relocation to a safe place and to seek services provided by a rape crisis center or domestic abuse center.

This includes both the employee’s needs and a family member’s needs. State law also defines family as a child, parent, sibling, grandparent, grandchild, spouse, domestic partner or in loco parentis. State law recognizes biological, foster, legal wards, adopted, in-law, and step relationships. Santa Monica acknowledges all of these same provisions in their ordinance.

Service Charges

Santa Monica requires that services charges be paid in entirety to the employee’s performing those services. Owners, managers and supervisors cannot share in those costs or fees collected. Employers must also provide clear notice to customers regarding those charges and its uses. It does allow for service charges to be pooled as long as supervisors and managers don’t share in the split of charges.

Service charges include banquet fees, room service, and bag handling fees. These service charges cannot be used to credit against the employee’s wages. Health benefit charges that are non-service charges can be used toward employee benefits. Employers are required to pay employees on the date the service charge is collected if it’s paid in cash, or by the next pay period. Additionally, employers are required to keep records of all service charges and payment to employees for a minimum of three years.

Penalties for Sick Leave Violations

Civil penalties for violations are up to $100 per violation per employee. Additional treble damages can be assessed for willful violations. Each violation is counted in days. In addition, employees affected by violations have the rights to be compensated for repayment of withheld  wages, payment of sick leave. If the employee was terminated, then they are eligible for reinstatement of employment and injunctive relief. Criminally, violations can be prosecuted at $500 per violation and up to 6 months in jail. Plus those found guilty must reimburse the entire cost of law enforcement investigations.

Points not addressed by the Santa Monica Ordinance

There are several items that have been addressed by other city ordinances that are not addressed by the Santa Monica Paid Sick Leave Ordinance. The first item not addressed is what happens if an employee stops working for an employer and has accrued, but not used sick leave and then reinstates their employment within a year. California State Sick Leave must be reinstated to the employee for a year after the termination of their employment.

Since the Santa Monica Sick Leave provides more sick leave to employees than the state law and does not address reinstatement of employment, employers will need to at least follow the provisions of the state law.

The second item that Santa Monica’s ordinance doesn’t address is whether or not employers can require an employee to give reasonable notice for the additional days awarded through the city’s plan.

The third item not addressed by the ordinance is if employers can require a doctor’s note. Under State law, any employer who requires a doctor’s note is unlawfully interfering with an employee’s right for sick leave.

Therefore employers who have a policy that requires a doctor’s note should be very careful and should check with legal counsel to make sure that they aren’t violating state law.

Posting and Notice Requirements

Each year the City will publish a bulletin that must be posted in the workplace for employees to see. Notices should be posted in both Spanish and English. Plus if the employer has any other language spoken by 5% of their employees or more, then notices are required to be posted in the additional languages. In addition, notice should be given to every new employee.

Let SwipeClock Help

Businesses who have employees in Las Angeles, Santa Monica and a growing list of other cities may have to comply with multiple conflicting City ordinances defining Sick leave accrual and usage laws. Additionally, these businesses have to also comply with California Sick Leave laws, California FMLA, Federal FMLA and maintain compliance with Federal Overtime Laws, the Family Leave Medical Act and any other national or local laws that are enacted. SwipeClock provides a comprehensive array of workforce management and time tracking tools that can help businesses to more easily stay in compliance with local and national laws. Records are effortlessly kept for years and accrual is automatically tracked and reported to employees according the state and city laws. Additionally, with geo-timekeeping clocks, businesses can effortlessly track time worked in specific cities to ensure compliance.

About SwipeClock

SwipeClock is a leading provider of cloud-based integrated workforce management solutions that include automated time and attendance, advanced scheduling, and leave management capabilities. The company’s products, including TimeWorks Plus, Time Simplicity, and Workforce Management Clock enable employers to manage their most important and expensive asset-employees-by transforming labor from a cost of doing business to a competitive advantage. SwipeClock’s workforce management solutions are sold through over 850 partners that empower more than 26,000 businesses to lower labor costs, comply with regulatory mandates, and maximize their profits. For more information, please visit www.swipeclock.com.

Written by Annemaria Duran. Last updated November 22, 2016

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