Bonding by the Bay: San Francisco Mandates
Paid Parental Leave
On April 21, 2016, Mayor Ed Lee signed an ordinance making San Francisco the first municipality to require private employers to compensate employees while on parental bonding leave. Under the law, when covered employees use California Paid Family Leave (PFL) benefits for new child bonding – bonding with a minor child during the first year after birth or placement through foster care or adoption – covered employers must pay “supplemental compensation.” The new ordinance, operative on January 1, 2017, continues San Francisco’s legacy of progressive employment standards.
Under the PPL (Paid Parental Leave) ordinance, the amount of San Francisco supplemental compensation an employer would pay is the difference between the employee’s current normal gross weekly wage and state benefits received.
For claims beginning on or after January 1, 2016, California’s PFL benefit program provides a maximum weekly benefit of $1,129 (55% of weekly wages for an employee with an annual salary of $106,647.32). For claims beginning on or after January 1, 2018, but before January 1, 2022, the maximum weekly benefit will increase to either 60 or 70% of weekly wages, subject to an established maximum weekly benefit.
Summary & Important Points:
- The ordinance applies to employers with 20 or more employees located anywhere (so long as at least one works in San Francisco), but when an employer must begin to offer supplemental compensation depends on an employer’s size.
- While the ordinance covers employers without a place of business in San Francisco (if the employee works in San Francisco), simply living in San Francisco does not entitle an employee to benefits.
- Benefits are not required if employees do not comply with certain requirements.
- Benefits are based on what 100% of state benefits would be if an employee receives the maximum state benefit, or an employee’s current normal gross weekly wage if receiving less than the maximum state benefit.
- Benefits can be offset by requiring employees to use accrued vacation.
- Employers should monitor DLSE’s website to obtain the required poster and determine whether FAQ and/or accompanying regulations will be issued.