California May Expand Unpaid Family Leave Requirements for Small Business

COVID-19 Update

Last week, just before adjourning for a COVID-19-shortened summer recess, the California State Senate passed a measure that, if it becomes law, would significantly expand the availability of unpaid family leave in the state. SB 1383 would extend family leave protections to employers with five or more employees and significantly add to the circumstances in which employees will be entitled to family leave and return rights to the same or a comparable job. Current state law, the California Family Rights Act (CFRA), applies to covered employers with 50 or more employees.

If enacted, effective January 1, 2021, the legislation, authored by Sen. Hannah-Beth Jackson (D-Santa Barbara), would require covered employers to provide eligible workers with up to 12 weeks of unpaid family leave for the birth, adoption or serious illness of a child; to care for a seriously ill parent or spouse, grandparent, or other listed relative; and so that an employee can deal with their own serious health condition or with the absence of a spouse, domestic partner, child or parent called to active duty in the U.S. armed forces.

To be eligible for family leave, an employee must have at least 12 months of service with the employer and at least 1,250 hours of service with the employer during the previous 12-month period.

SB 1383 passed the Senate with the bare minimum number of votes—21 of 40 senators voted for the expansion—despite the fact that Democrats hold 29 seats of the 40-member Senate. The bill must now pass the California Assembly before September 1 to become law this year. With Democrats holding 61 of the 80 seats in the Assembly, and only a simple majority vote of 41 members required to pass SB 1383, passage seems likely. However, given the havoc COVID-19 continues to wreak upon the economy generally, and small business specifically, passage of SB 1383 is not a foregone conclusion. That said, Governor Newsom has provided strong support for the legislation, demonstrated by his decision in June to put it on the list of bills he wanted the Legislature to enact as part of the extended state budget negotiations. In a press conference called to support the measure, he credited First Partner Jennifer Seibel Newsom with a continued push to change the law. Some Democratic senators objected to making the bill part of the budget process, and the bill has been “de-coupled” from the formal budget legislation, but it has significant support in the Assembly from key pro-labor Democrats, including the powerful Chair of the Assembly Appropriations Committee, Lorena Gonzalez, a co-author of the bill.

If the Assembly does pass the bill, Governor Newsom has made it clear he will sign it into law.

Manatt will continue to monitor developments regarding this legislation.

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