Important Information for
FCC Payroll Clients regarding California Paid Sick Leave

 

Dear FCC Payroll Client,

Paid sick leave is mandatory in California and you are required to post this California sick leave poster where employees will see it.

Some cities, such as Oakland and San Francisco, have their own sick leave laws. If you are aware of any other local sick leave laws, please let us know.

State law requires that sick time be shown on employee paystubs. Therefore, our software will keep track of sick time accrued and taken by your employees.

California employers must choose between the **annual allocation method** and the **hourly accrual method.**

We will default your employees to the annual allocation method, unless you let us know that you prefer to use the hourly accrual method instead.

Please read this important information about your
sick leave choice:

Under the annual allocation method, employees are granted 24 hours of sick leave at the beginning of every year, with no annual carryover.

Under the hourly accrual method employees receive 1 hour of paid sick leave for every 30 hours they work. They carry over unused sick time from year to year, though employers can limit the annual carryover to 48 hours.

I recommend that Oakland and San Francisco employers use the accrual method because of the laws in effect in those cities.

Otherwise, we default to 24-hour annual allocation for a few reasons:

1. The state requires that all employees have at least 24 hours of sick time available by their 120th calendar day of employment. Often times this won't be the case when using the hourly accural method.

2. All employees have a maximum sick leave allocation of 24 hours each year. Under the hourly accrual method, I have seen some the employees accrue much more than 24 hours.

3. Switching from hourly accural to the
24-hour method later may be costly.
If an employee has already accrued more than
24 hours, the employer may be required to compensate the employee for any accrued hours lost in the conversion to the 24-hour method.

4. I find the annual allocation method to be a bit simpler and easier to understand.

On a yearly basis, you can choose either annual allocation or hourly accural. (But pay attention to my warning under point 3 above.) Your sick leave plan should be documented and employees notified of the provisions.

When you log into your FCC Payroll account, you will see a Sick Time Hours data entry field for every employee on your Time Cards page. (Right under the "Regular Hours" field.) When necessary, this is where you will enter paid sick time for an employee.

Please refer to the state's Frequently Asked Questions for further information.

Yours,

 

**San Francisco Employers: Your city's accrual rate for sick leave is the same as the statewide sick leave law (1 hour for every 30 hours worked). Because of the new state law, there is no longer any limit to the number of hours employees can accrue. However, you can limit the amount of paid sick leave taken each year. The San Francisco limit is 40 hours (for employers with fewer than 10 employees), NOT 24 hours, as specified in the state law. The 90-day waiting period before taking leave still applies, but the annual carryover will be capped at 48 hours, instead of 40 hours. As covered in provision #1 above, you will have to pay attention to sick leave taken and enforce the 40 hour annual limit.

 

Family Child Care Taxes
FCC Payroll Service


We at FCC Payroll do our very best to implement your sick leave policy. However, It is up to you to ensure that employees accrue and use sick leave in accordance with applicable state and local laws.

Sick leave laws in Caliornia are quite complex. I encourage you to seek legal counsel as necessary.

Sick time will appear on employee paystubs. There you can see the amount of sick time earned, used,
and available for each employee.

If you enter sick time for an employee we will add sick pay to their paycheck. However, unless you tell us otherwise, we will pay them only for as much sick time as they have currently available.

For example:
If an employee has 3 hours of sick leave available and you enter 4 hours of sick pay on their time card, unless you tell us otherwise, we will add only 3 hours of sick pay to the employee's paycheck.

 

IMPORTANT:
Here are two sick leave provisions that our software cannot enforce,
but YOU CAN:

1) Employees accrue paid sick leave on their first day of employment, but they are not entitled to TAKE sick leave until their 90th day of employment. However, you can adopt a sick leave policy allowing employees to take sick leave before 90 days, if you wish. We will pay employees for any sick time hours entered, up to the amount they have accrued. It is up to you to enforce the 90-day grace period (or not).

2) For those using hourly accrual method:
You are allowed to adopt a policy limiting sick leave taken by employees to 24 hours per year (40 hours for SF and Oakland employers**), even though their paystub may show more sick time accrued. To enforce this limit, you will have to pay attention to the amount of sick time already taken by employees, as shown on their paystub.
We will add available sick pay to employee paychecks based on sick time you enter, irregardless of any annual maximum.


Please Note:

If you are using the hourly accrual method, unused sick time will carry over at the end of each year.

We will limit the annual carryover to 48 hours, as allowed. If you prefer NOT to limit the annual carryover, let us know.

Document annual sick leave maximums and carryovers
and notify employees.

 

**Oakland Employers: Your city's accrual rate for sick leave is the same as the statewide sick leave law (1 hour for every 30 hours worked). Because of the new state law, there is no longer any limit to the number of hours employees can accrue. However, you can limit the amount of paid sick leave taken each year. The Oakland limit is 40 hours (for employers with fewer than 10 employees), NOT 24 hours, as specified in the state law. The 90-day waiting period before taking leave still applies, but the annual carryover will be capped at 48 hours, instead of 40 hours. As covered in provision #1 above, you will have to pay attention to sick leave taken and enforce the 40 hour annual limit.

 
 

All items above are for information only and are not meant as tax advice.
Please consult your own tax advisor to see how each item impacts your own situation.

 
 

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