After a two-year break, San Francisco Health Care Security Ordinance employer reporting has resumed this year. Employers who are subject to the San Francisco Health Care Security Ordinance (HCSO) or the Fair Chance Ordinance (FCO) must submit the 2021 Employer Annual Reporting Form by May 2, 2022.

The HCSO applies to employers with 20 or more total employees worldwide and at least one employee who performs work within the city or county of San Francisco. The ordinance requires the employer to meet a certain spending threshold for each San Francisco employee related to health care. Employers must report the number of employees covered by the ordinance per quarter in 2021 and detail the health care expenditures made each quarter (payments for health insurance, contributions to the City Option or irrevocable expenditures to a reimbursement account).

The FCO applies to employers who have five or more total employees worldwide and at least one employee who performs work within the city or county of San Francisco. Additionally, employers who have a service contract with the City of San Francisco are also subject to the ordinance, regardless of the number of employees. The FCO ordinance prohibits employers from asking about arrest or conviction records on a job application. Employers must report whether their employment application in San Francisco asks about arrest or conviction information; and whether they conducted background checks on conviction or arrest records before a live interview (including telephonic).

Failure to comply with the annual reporting may result in a penalty of $500 per quarter assessed against the employer.

Covered employers should ensure that they retain supporting records to establish compliance with the spending requirements and FCO requirements. For 2022 compliance, covered employers should ensure that they displayed the posters for the 2022 HCSO Notice and FCO Poster in their workplaces or job site. Covered employers should also contribute the 2022 minimum healthcare expenditures for the San Francisco employees and satisfy all other requirements under those ordinances during 2022.

Reporting Form »
Reporting Instructions »
San Francisco HCSO Main Site »

The California Department of Industrial Relations published FAQs related to the 2022 COVID-19 Supplemental Paid Sick Leave (SPSL), which was originally discussed in the March 1, 2022, edition of Compliance Corner.

The SPSL requirement applies to employers with 26 or more employees. The new guidance clarifies that employers must include all employees nationwide to determine size. Employees are eligible for the leave if they work in California and are unable to work (including telework) due to their own COVID-19 related symptoms or are caring for a family member with COVID-19 related symptoms, they or a family member is receiving the vaccine, or they or a family member is experiencing vaccine related side effects. Independent contractors are not eligible for SPSL.

The law appeared to require employers to establish two different banks of leave: 40 hours for leave related to quarantine and the vaccine and an additional 40 hours if the employee or family member tested positive for COVID-19. The new guidance clarifies that an employer may alternatively have a single bank of up to 80 hours for any of the qualifying reasons.

Lastly, the law required employers to identify on the paystub the amount of COVID-19 SPSL used by the employee. Employers are not required to add separate lines for each 40-hour bank and may instead report a single line for the 80-hour 2022 SPSL. This requirement was effective for the payday related to the first full pay period starting after February 19, 2022.

Employers should adjust their policies and documentation accordingly based on the new guidance.

Department of Industrial Relations, 2022 COVID-19 SPSL FAQs »

On February 9, 2022, Gov. Newsom signed SB 114 into law, which is the 2022 COVID-19 Supplemental Paid Sick Leave (SPSL). The 2021 version of the law expired on September 30, 2021. Like the prior version, employers with 26 or more employees must provide paid leave to employees who are unable to work (including telework) for a COVID-19 related reason.

The new law is retroactively effective to January 1, 2022. Employers must make available two different banks of 40 hours paid leave each; this varies based on the reason for leave.

The first bank of COVID-19 SPSL, up to 40 hours, is available to covered employees unable to work or telework due to any one of the following reasons:

• Employee’s own health: The employee is subject to a quarantine or isolation period related to COVID-19 or has been advised by a healthcare provider to quarantine due to COVID-19 or is experiencing symptoms of COVID-19 and seeking a medical diagnosis. This includes a quarantine period following exposure to COVID-19.
• Caring for a family member: The employee is caring for a family member who is subject to a quarantine or isolation period related to COVID-19 or has been advised by a healthcare provider to quarantine due to COVID-19, or the employee is caring for a child whose school or place of care is closed or unavailable due to COVID-19 on the premises.
• Vaccine-related: The employee or family member is attending a vaccine appointment or cannot work or telework due to vaccine-related side effects — this includes a booster shot.

The second bank of COVID-19 SPSL, up to 40 hours, is available only if an employee or a family member for whom they are providing care tested positive for COVID-19. As defined under the previous law, family members include a child, parent, spouse, registered domestic partner, grandparent, grandchild or sibling. A positive test result includes that from an over-the-counter testing product. The employer may require documentation of the test result, including a photo of the result or electronic communication from the testing provider. The employer may require an additional test five days after the initial negative test result, but only if the employer makes the test available to the employee either by securing a testing appointment or providing a test.

Employers should have posted a notice in the workplace by February 19, 2022. If employees do not report to a physical worksite, the employer should distribute the notice electronically. Starting with the paycheck related to the first full pay period following February 19, 2022, employers must identify on the paystub the amount of COVID-19 SPSL used by the employee.

Employers should take action to post the required notice, update their payroll system to reflect the required paystub information, revise their leave policies, and generally make the paid leave available to employees. Additionally, because the law is retroactive to January 1, 2022, employers should be prepared to reprocess payment, per employee request, for qualifying leave that occurred prior to February 19, 2022.

2022 COVID-19 Supplemental Paid Sick Leave FAQs »
2022 COVID-19 SPSL Poster »

The Department of Fair Employment and Housing (DFEH) updated the “Your Rights and Obligations as a Pregnant Employee” and “Family Care and Medical Leave and Pregnancy Disability Leave” posters. These publications inform employees of their rights under California’s Family Rights Act (CFRA) and Pregnancy Disability Leave (PDL). Employers with five or more employees must post the notices at their California worksites. If employees work remotely, the notice may be delivered electronically. If 10% or more of the company’s workforce speak a language other than English, the notice must be posted in that language, which is available from the DFEH publications webpage.

“Your Rights and Obligations as a Pregnant Employee” Poster, 2022 »
“Family Care and Medical Leave Pregnancy Disability Leave” Poster, 2022 »
DFEH Publications Webpage »

The Department of Fair Employment and Housing (DFEH) revised the Certification of Health Care Provider, which is used for an employee requesting leave under the California Family Rights Act (CFRA). CFRA is California’s version of FMLA. It previously applied to employers with 50 or more employees. However, effective January 1, 2021, the law and its requirements apply to employers with five or more California employees. The law provides up to 12 weeks of unpaid leave for an eligible employee with a serious health condition (except for maternity related disability, which is covered by Pregnancy Disability Leave, or PDL), to care for a family member with a serious health condition, or for an employee to bond with a newly born or adopted child.

The certification form has been changed to reflect the revised definition of a family member, which was effective January 1, 2021, and includes the employee’s child, parent, parent-in-law, grandparent, grandchild, sibling and spouse. Child and parent include those satisfying the loco parentis status.

Employers should begin using the revised form immediately.

Revised “Certification of Health Care Provider,” 2022 »

Effective January 14, 2022, the Occupational and Health Standards Board issued revised regulations implementing Cal-OSHA’s COVID-19 Prevention Emergency Temporary Standards. The rules apply to all employees in all places of employment except worksites with one employee who has contact with no other persons, employees teleworking from a non-employer site and employees covered by the state’s Aerosol Transmissible Diseases Standard.

Employers must establish, implement and communicate a written COVID-19 Prevention Program. The policy may be integrated with the employer’s Injury and Illness Prevention Program (existing Cal-OSHA requirement). Required elements of the program include a procedure for employees to report COVID-19 symptoms and workplace hazards (without fear of retaliation); procedure for employees with medical conditions to request accommodations; provide information on COVID-19 testing access; process for screening employees for COVID-19 symptoms (which may include employees self-screening at home); evaluation of how to maximize ventilation with outdoor air, air filtration, air cleaning systems; process for correcting hazards and procedures for investigating COVID-19 cases in the workplace.

Within one business day of the date the employer knew or should have known of a COVID-19 case, the employer must provide written notice to all employees and contractors who were present at the same worksite within the high-risk period. The notice should not identify the case by name. The employer must make COVID-19 testing available during paid time at no cost to employees who had close contact. Close contact is defined as being within six feet of a COVID-19 case for 15 minutes or more in a 24-hour period. Tests must be approved for use by the FDA and include home kits if the test is not both self-administered and self-read by the employee.

Employers must also provide COVID-19 testing available to symptomatic employees who are not fully vaccinated. The cost of the test must be paid by the employer and the employee must be paid for the time spent taking the test.

If employees are not fully vaccinated, the employer must provide face coverings and the employees must wear them when indoors. Face covering for this purpose is defined as a surgical mask, medical procedures mask, a respirator (worn voluntarily) or a fabric mask of at least two layers. The mask requirement does not apply to an employee who is alone in a room or vehicle; while eating or drinking; or those who cannot wear a face covering due to a medical or mental condition (including hearing impairment). Those not wearing a face covering must be at least six feet from other persons unless they are fully vaccinated or test negative weekly.

Affected employers should work with outside counsel to establish and implement policies and procedures in compliance with the requirements.

Cal-OSHA COVID-19 Prevention Emergency Temporary Standards »

Beginning September 30, 2020, California employers with more than 100 employees were required to offer employees a qualified retirement plan (such as a 401(k)) or participate in the state-run retirement savings program known as CalSavers. The requirement applied to employers with 51 to 100 employees on June 30, 2021, and will apply to employers with five or more employees on June 30, 2022. For this purpose, employer size is based on the number of California-based employees reported on the Employment Development Department quarterly report.

Before the June 30, 2022 deadline, small employers must sponsor a qualified retirement plan or register with CalSavers. Under CalSavers, an employer must automatically enroll eligible employees in the retirement program with a contribution of at least 3% of earnings. New employees must be enrolled within 30 days of employment. Employees may opt out of or back into the program at any time.

CalSavers Employer Registration »

The Employment Development Department (EDD) recently announced that the 2022 employee contribution rate for State Disability Insurance and Paid Family Leave will decrease from 1.2% to 1.1%. The taxable wage base from which the contributions will be taken will increase from $128,298 in 2021 to $145,600 in 2022. The maximum weekly benefit increases from $1,357 to $1,540.

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 »

Signed into law in June 2019, the California Individual Health Coverage Mandate established a state individual mandate effective beginning 2020. The law requires California residents to maintain minimum essential coverage (MEC) or pay a penalty. In conjunction with this mandate, there is a reporting requirement for employers that provide self-insured MEC to residents.

Reporting for the 2021 coverage year is due March 31, 2022, to the California Franchise Tax Board. The state will accept copies of federal Forms 1095-B and 1095-C. Self-insured employers must report coverage for any California resident who had coverage for any portion of the calendar year 2021. Note that employers are only subject to these requirements if their carrier does not complete this reporting. Failure to report can result in a $50 per covered person penalty.

Similar to federal filing, electronic returns are required if filing 250 or more forms.

Franchise Tax Board, Reporting Instructions »

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 »