The San Francisco Health Care Security Ordinance (HCSO) requires covered employers to satisfy an employer spending requirement by making healthcare expenditures for their covered employees, among other reporting and notice requirements. The healthcare expenditure rate varies depending on the size of the employer and increases incrementally each year.

As of January 1, 2022, the healthcare expenditure rate for large employers with 100 or more employees increases to $3.30 per hour payable (up from $3.18 per hour in 2021). For medium-sized employers with 20 to 99 employees and for nonprofit employers with 50 to 99 employees, the expenditure rate will rise to $2.20 per hour payable (up from $2.12 per hour payable in 2021). Employers with fewer than 20 employees and nonprofit employers with fewer than 50 employees are exempt.

If an employee is a managerial, supervisorial or confidential employee earning $109,643 per year ($52.71 per hour) or more, that employee is exempt from the HCSO. This represents an increase from last year’s threshold of $107,991 per year ($51.92/hour).

All covered employers will be required to post the revised notice in all workplaces and job sites, when the poster becomes available

2022 HCSO Announcement »

On April 21, 2021, the San Francisco Board of Supervisors approved an ordinance waiving the annual reporting requirement for calendar year 2020 related to the San Francisco Health Care Security Ordinance (HCSO). This supersedes the previous guidance issued by the San Francisco Office of Labor Standards Enforcement on March 24, 2021, which postponed the reporting for at least six months.

As background, employers with 20 or more employees must meet a minimum healthcare spending requirement on employees working at least eight hours in the city or county of San Francisco. Normally, an employer must file a report detailing their compliance by April 30 for the previous calendar year. However, the annual report has now been waived for calendar years 2019 and 2020 due to COVID-19 and the administrative burden the report places on employers. Employers should continue to comply with the spending requirement and maintain documentation.

San Francisco Board of Supervisors Ordinance »
San Francisco Office of Labor Standards Enforcement HCSO Information »

On March 9, 2021, Gov. Newsome signed SB 95 into law, requiring employers to provide supplemental paid sick leave to eligible employees. The law applies to employers with 26 or more employees. Unfortunately, neither the new law nor subsequent guidance clarified which employees have to be counted toward the 26-employee threshold. If we look conservatively to how California administers their other laws, all employees working for the employer nationwide would be counted.

Employees are eligible for paid leave for the number of hours they typically work in a two-week period up to 80 hours. The leave allotment is in addition to any normal PTO, paid leave, or mandated safe and sick leave.

The reasons for leave are:

1. The covered employee is subject to a quarantine or isolation period related to COVID-19 as defined by an order or guidelines of the State Department of Public Health, the federal Centers for Disease Control and Prevention, or a local health officer who has jurisdiction over the workplace.
2. The covered employee has been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19.
3. The covered employee is attending an appointment to receive a vaccine for protection against contracting COVID-19.
4. The covered employee is experiencing symptoms related to a COVID-19 vaccine that prevent the employee from being able to work or telework.
5. The covered employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
6. The covered employee is caring for a family member, who is subject to an order or guidelines described in subparagraph A or who has been advised to self-quarantine, as described in subparagraph B. Family member for this purpose is defined as: child (biological, adopted, foster, stepchild, legal ward or a child to whom the employee stands in loco parentis); parent (biological, adoptive, foster, stepparent or legal guardian of an employee or the employee's spouse or registered domestic partner, or a person who stood in loco parentis when the employee was a child); spouse; registered domestic partner; grandparent; grandchild; and sibling.
7. The covered employee is caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.

Employees should be paid their normal rate of pay while on leave up to a maximum of $511 per day.

The law is effective retroactively back to January 1, 2021, and is in effect through September 30, 2021. Many counties and cities across the state of California have enacted their own COVID-19-related leave laws, which means that employers will need to make sure that their policies comply with both state and local laws. Remember, federal FFCRA emergency paid sick leave and expanded FMLA are currently optional for an employer. If an employee's leave qualifies under both state/local and federal, the employer would be able to receive a federal payroll tax credit.

Employers should update their leave policies, make adjustments to their payroll systems, post the required notice and communicate to employees as soon as possible.

California SB 95 »
Required Poster »
2021 COVID-19 Supplemental Paid Sick Leave FAQs »

The San Jose COVID-19 Paid Sick Leave Ordinance was originally effective April 7, 2020 and expired December 31, 2020. The ordinance is extended to June 30, 2021.

As a reminder, the law requires employers to provide paid sick leave to employees who are unable to work for one of the following reasons:

• The employee is subject to quarantine or isolation by federal, state or local order due to COVID-19.
• The employee is caring for someone who is quarantined or isolated due to COVID-19.
• The employee is advised by a health care provider to self-quarantine due to COVID-19 or is caring for someone who is so advised by a health-care provider.
• The employee experiences symptoms of COVID-19 and is seeking medical diagnosis.
• The employee is caring for a minor child because a school or daycare is closed due to COVID-19.

Employers who were required to provide leave under FFCRA were previously exempt. However, now that leave under FFCRA is optional for employers, the paid sick leave ordinance applies to all employers that meet the following two requirements:

• The employer is subject to the Business License Tax required by Chapter 4.76 of the Municipal Code, or maintains a facility within the boundaries of the City; and
• The employer is lawfully allowed to conduct business activities under the County of Santa Clara, state or federal health orders.

Employees are eligible only if they leave their residence to perform work and they have worked for the employer within the city of San Jose for at least two weeks.

Eligible full-time employees may receive up to 80 hours of paid sick leave up to a daily max of $511. Part-time employees may receive paid sick leave based on the average number of hours and pay rate for a two-week period.

Employers who were originally exempt because of FFCRA should update their leave policies and communicate eligibility to employees in compliance with the revised ordinance.

Paid Sick Leave Ordinance, Extended and Expanded »

The San Francisco Board of Supervisors and Mayor Breed recently extended the provisions of the Public Health Emergency Leave, which was originally enacted April 2020. The ordinance applies to employers with 500 or more employees (counting employees inside and outside San Francisco).

Employees working in San Francisco may take up to 80 hours (two weeks) of paid leave if they experience a qualifying reason. The reasons for leave are:

• The employee is subject to an individual or general Federal, State, or local quarantine or isolation order related to COVID-19.
• The employee has been advised by a health care provider to self-quarantine.
• The employee is experiencing symptoms associated with COVID-19 and seeking a medical diagnosis.
• The employee is caring for a family member who is subject to an order as described above, has been advised by a health care provider or is experiencing COVID-19 symptoms.
• The employee is caring for a family member whose normal school or place of care has been closed, or the care provider is unavailable, due to the public health emergency.
• The employee is experiencing any other substantially similar condition specified by the Local Health Officer, or under Section 5102(a) (6) of the Families First Coronavirus Act, by the United States Secretary of Health and Human Services.

Effective February 11, 2021, certain bona-fide Section 501(c)(3) non-profit employers are prospectively exempt from the leave requirement. To qualify for the exemption, the non-profit entity must not be engaged in healthcare operations and a majority of their annual revenue is "program service revenue that is not unrelated business taxable income" under Section 512 of the IRC.

Employers should remain in compliance with the posting requirement and provision of leave. While the current extension is only for 61 days, it is expected to be extended again.

Public Health Emergency Leave Extension »
Public Health Emergency Leave Poster »

Effective March 21, 2021, employers with employees who are covered by SFO’s Quality Standards Program (QSP) – adopted by the San Francisco Airport Commission – are required to meet a health care spending requirement. It is important to note that the QSP does not apply to all workers employed at SFO, but personnel involved in performing services which directly impact safety and/or security at the Airport, such as checkpoint security screening, skycap baggage check-in, baggage handling, aircraft cleaning and fueling, food preparation for aircraft delivery, grounds maintenance, custodial, and other employees issued an Airport badge with air operations area access.

The employer of such employees must comply with one of the following health care spending options:

1. Offer 90% actuarial value medical coverage to employees and dependents at no cost to the employee. All tiers of coverage must be employer paid. The coverage must provide benefits for all 10 categories of Essential Health Benefits including pediatric dental and vision. This applies to any employee covered by the QSP regardless of the number of hours worked.
2. Pay $9.50 per hour (not to exceed $380 per week) for any QSP employee into the City Option Program.

The coverage for any program eligible employee should be effective before or on March 21, 2021. The employer should have an enrollment or waiver for each employee covered by the QSP. An employee must provide proof of other coverage with the waiver. Going forward, coverage for new employees must be effective on or before the first day following 30 days of employment.

Covered employers must also post the required notice.

San Francisco Healthy Airport Ordinance, FAQ's »
Waiver Form »
Notice »

The City Council extended the Emergency Paid Sick Leave, which was originally enacted May 12, 2020 and expired December 31, 2020. The ordinance will now remain in effect until the end of the local health emergency (and is retroactively reinstated back to January 1, 2021).

Employers with 50 or more employees must provide up to two weeks of paid leave for employees who are unable to perform work (including telework) for COVID-19-related reasons. The reasons for leave are like those under the FFCRA:

• The employee is subject to quarantine or isolation by federal, state or local order due to COVID-19.
• The employee is caring for someone who is quarantined or isolated due to COVID-19.
• The employee is advised by a healthcare provider to self-quarantine due to COVID-19 or is caring for someone who is so advised by a healthcare provider.
• The employee experiences symptoms of COVID-19 and is seeking medical diagnosis.
• The employee is caring for a minor child because a school or daycare is closed due to COVID-19.

Additionally, an employee may be eligible for leave if the employee:

• Is 65 years of age or older.
• Has a health condition such as heart disease, asthma, lung disease, diabetes, kidney disease or weakened immune system.
• Has any condition identified by an Alameda County, California or federal public health official as putting the public at heightened risk of serious illness or death if exposed to COVID-19.
• Has any condition certified by a healthcare professional as putting the employee at a heightened risk of serious illness or death if exposed to COVID- 19.

Importantly, employers cannot request or require a healthcare provider’s certification.

Employees are eligible if they performed at least two hours of work within the city of Oakland after February 3, 2020. Full-time employees (those who average 40 hours per week) are eligible for up to 80 hours of paid leave with part-time employees eligible for their average hours worked over a two-week period. Employees must be paid normal wages up to $511 per day. Health benefits must be continued during the leave period.

Employers should continue to comply with the ordinance requirements. The employer is only required to provide up to 80 hours of leave one time. In other words, employees did not receive a new emergency paid sick leave allotment with the new calendar year.

Emergency Paid Sick Leave Extended »

The Board of Supervisors retroactively extended and expanded the Supplemental Paid Sick Leave Ordinance, which was originally enacted on April 28, 2020. The ordinance required employers with 500 or more employees nationally to provide paid sick leave to employees in LA County and expired on December 31, 2020. The ordinance now expires two weeks after the end of the local COVID-19 health emergency (and is retroactively extended from January 1, 2021). Furthermore, since leave under FFCRA is now optional for employers, the Board expanded the law to apply to all sized employers in the unincorporated areas of the county.

Employees do not need to satisfy a service requirement. An employee merely needs to be employed during the period covered by the ordinance. To be eligible, an employee must not be able to work (including telework) due to one of the following reasons:

• A public health official or health care provider requires or recommends the employee isolate or self-quarantine to prevent the spread of COVID-19.
• The employee is subject to a federal, state or local quarantine or isolation order related to COVID-19 (e.g., is at least 65 years old or has a health condition such as heart disease, asthma, lung disease, diabetes, kidney disease or weakened immune system).
• The employee needs to care for a family member who is subject to a federal, state or local quarantine or isolation order related to COV1D-19 or has been advised by a health care provider to self-quarantine for reasons related to COVID-19.
• The employee takes time off work because the employee needs to provide care for a family member whose senior care provider, school or childcare provider ceases operations in response to a public health or other public official's recommendation.

Eligible full-time employees may receive up to 80 hours of paid sick leave up to a daily max of $511. Part-time employees may receive paid sick leave based on the average number of hours and pay rate for a two-week period during the eligibility period.

Importantly, an employer may not require a doctor’s note or other documentation from the employee.

Employers who were originally exempt because of size should revise leave policies and communicate eligibility to employees in order to comply with the ordinance’s requirements.

Supplemental Paid Sick Leave, Revised »

The City Council and Mayor Garcetti recently revised the Supplemental Paid Sick Leave Ordinance, which was originally enacted on April 7, 2020. The ordinance applies to employers with 500 or more employees within the city of Los Angeles or 2,000 or more employees within the U.S. The following employers are exempt:

• Employers who have an existing policy which provides 160 hours or more of paid leave annually.
• New businesses (other than construction) that started in the city (or relocated from outside the city) on or after September 4, 2019, through March 4, 2020.
• Any business that has been closed or inoperable for a period of 14 days or more due to a city official’s emergency COVID-19 order.
• Governmental agencies, emergency and health services personnel, and global parcel delivery services.

Eligible full-time employees may receive up to 80 hours of paid sick leave up to a daily max of $511. Part-time employees may receive paid sick leave based on the average number of hours and pay rate for a two-week period during the eligibility period.

Originally, an employee was eligible if they performed any work within the city of Los Angeles for the employer and had been employed with the same employer from February 3, 2020, through March 4, 2020.  These terms of eligibility excluded new employees because the public health emergency has continued for such a lengthy period. Accordingly, the city revised the ordinance to allow certain employees who have been employed by the employer for 60 days to become eligible. The revisions were effective February 10, 2021.

To be eligible, an employee must not be able to work (including telework) and satisfy one of the following conditions:

• The employee has been diagnosed with COVID-19.
• The employee has isolated or self-quarantined because of a requirement or recommendation of a public health official or health care provider.
• The employee is at least 65 years old or has a health condition such as heart disease, asthma, lung disease, diabetes, kidney disease or weakened immune system.
• The employee needs to care for a family member who is not sick but who public health officials or health care providers have required or recommended isolation or self-quarantine.
• The employee needs to provide care for a family member whose senior care provider or whose school or childcare provider caring for a child under the age of 18 temporarily ceases operations in response to a public health or other public official’s recommendation. This provision is only applicable to an employee who is unable to secure a reasonable alternative caregiver.

An employer may not require a doctor’s note nor other documentation from the employee.

Employers should revise their policies and communicate eligibility to newer employees who were previously excluded. The ordinance will remain in effect until two weeks after the end of the local COVID-19 health emergency.

Supplemental Paid Sick Leave Ordinance, Revised »

The Employment Development Department (EDD) recently announced that the 2021 employee contribution rate for State Disability Insurance and Paid Family Leave will increase from 1.0% to 1.2%. The taxable wage base from which the contributions will be taken will increase from $122,909 for calendar year 2020 to $128,298 in 2021. The maximum weekly benefit increases from $1,300 to $1,357.

Employers should be aware of this change in rates and limits, and they should work with their payroll provider to adjust employee contributions.

EDD Announcement »