California’s New Parental Leave Act

Source: CalChamber

For more than 20 years, only employers with 50 or more employees had to provide eligible employees with protected time off to bond with a newborn, or a child placed with the employee for adoption or foster care. That’s because those employers were covered by the federal Family Medical Leave Act (FMLA) and the California Family Rights Act (CFRA). Both laws give employees the right to take protected time off for certain qualifying reasons, one of which is bonding with a new child.

Employers with less than 50 employees had no legal obligation to allow employees to take off time for baby bonding — but that all changes on January 1, 2018, when California’s New Parent Leave Act goes into effect.

Under the New Parent Leave Act (Parental Leave), employers with 20 or more employees must provide eligible employees with 12 weeks of unpaid, job-protected leave to bond with a new child.

Compliance with this new law is essential. You will be liable if you fail to provide an eligible employee with Parental Leave, fail to guarantee the employee the right to return to the same or comparable position at the end of Parental Leave, or take any adverse action against an employee for taking Parental Leave or for exercising his/her rights under the law.

Who’s Eligible for Parental Leave?

The New Parent Leave Act applies to:

  • Any person who directly employs 20 or more persons to perform services for a wage or salary; and
  • The state and any political or civil subdivision of the state and cities, regardless of the number of employees.

To be eligible for Parental Leave, an employee must:

  • Have worked for a covered employer for at least 12 months;
  • Have worked at least 1,250 hours in the 12 months before taking leave; and
  • Work at a worksite that has at least 20 employees within a 75-mile radius.

Parental Leave is available only to employees who are not subject to both FMLA and CFRA. However, that doesn’t mean that employers covered by FMLA/CFRA shouldn’t be concerned with the New Parent Leave Act.

There may be times when an employer covered under FMLA/CFRA has an employee who is not eligible for FMLA/CFRA but is eligible for Parental Leave. For instance, the employee might not be eligible for FMLA/CFRA because the employee works at a worksite with less than 50 employees within a 75-mile radius. This employee, however, will be eligible for Parental Leave if the employee has worked for you for at least 12 months, worked at least 1,250 hours in the last 12 months and works at a worksite with at least 20 employees within a 75-mile radius.

For example, you have 75 employees at your corporate headquarters in Oakland and 25 employees at your satellite office in San Diego. Jennifer has been a full-time employee for the past five years and works in your San Diego office. She just adopted a baby and wants to take 12 weeks off to bond with her new child.

  • Jennifer is not eligible for baby bonding leave under FMLA/CFRA because she does not work at a location with 50 or more employees within a 75-mile radius.
  • Jennifer is eligible for Parental Leave under the New Parent Leave Act because she works at a location with 20 or more employees within a 75-mile radius.

Duration and Timing of Leave

Eligible employees can take up to 12 weeks of Parental Leave to bond with their new child. The leave must be taken within one year of the child’s birth, adoption or foster care placement.

The 12 weeks of Parental Leave is in addition to the up to four months of Pregnancy Disability Leave (PDL) available to a pregnant parent. An employee eligible for PDL and Parental Leave can take up to four months of protected leave when disabled by pregnancy and then an additional three months of Parental Leave.

If both parents work for you and both are eligible for Parental Leave, you must allow both to take Parental Leave. However, you are not required to provide more than 12 weeks total for both employees. You may allow the employees to take the leave simultaneously, but are not required to do so.

Pay During Parental Leave

Though Parental Leave is an unpaid leave of absence, the law allows employees to use accrued vacation pay, paid sick time or other accrued paid time off (PTO) to receive compensation during the leave. If an employee requests to use such time, you must allow them to do so.

Although employees have the right to use accrued vacation, sick or PTO during Parental Leave, employers cannot require employees to use such time.

Employees who take Parental Leave can also apply for Paid Family Leave (PFL) benefits through California’s Employment Development Department (EDD). Eligible employees can receive up to six weeks of PFL benefits from the EDD while on Parental Leave. Employees working in San Francisco who take Parental Leave may also be eligible for supplemental compensation during their leave under the San Francisco Paid Parental Leave Ordinance.

Benefits During Parental Leave

One of the protections that comes with Parental Leave is the right to continued health benefits. If you provide health benefits under any group health plan, you must continue providing those benefits to an employee on Parental Leave, and you must do so for the entirety of the leave (up to 12 weeks).

The law requires that you maintain and pay for the employee’s health coverage at the same level and under the same conditions as coverage would have been provided if the employee was continuously employed during the entire leave period.

If an employee does not return to work after Parental Leave, however, you can recover the premium you paid for maintaining the employee’s coverage — as long as the employee’s failure to return was for a reason other than the continuation, recurrence or onset of a serious health condition, or other circumstances beyond the employee’s control.

Employer Notice Requirement

The New Parent Leave Act requires that employers provide employees with a guarantee of reinstatement before an employee begins his/her Parental Leave. If you fail to provide this guarantee of reinstatement before the employee’s leave begins, you will be treated as if you refused to allow the employee to take Parental Leave and can be held liable for a violation of the law.

Employers should ensure that all employees taking Parental Leave are provided a guarantee that the employee will be reinstated to the same or comparable position at the conclusion of the employee’s Parental Leave. The guarantee should be in writing. CalChamber will have a form available for employers to use.

Returning to Work After Leave

When an employee returns from Parental Leave, you must reinstate the employee to the same or comparable position. If you need to terminate an employee on Parental Leave or have concerns about reinstatement, seek legal counsel.

Pilot Mediation Program

The New Parent Leave Act also requires that the Department of Fair Employment and Housing create a mediation pilot program to mediate disputes between employers and employees related to Parental Leave.

Unanswered Questions About Parental Leave

It may seem like there are more questions than answers when it comes to Parental Leave, but some help may be on the way.

The New Parent Leave Act directs the California Fair Employment and Housing Council (FEHC) to incorporate the CFRA regulations to govern Parental Leave, provided the CFRA regulations are within the scope of and are not inconsistent with Parental Leave. The FEHC is expected to propose regulations for the New Parent Leave Act in 2018.

The FEHC will need to answer a number of issues not addressed by the new law, such as:

  • How do employers determine whether they meet the 20 employee threshold to be a covered employer? When will employers cease to be covered once they drop below 20 employees?
  • For employees who work remotely, what is their worksite? Is it the worksite to which they report, such as with FMLA/CFRA leave?
  • Can new parents take Parental Leave on an intermittent basis? The CFRA regulations provide that the basic minimum duration of a CFRA baby bonding leave is two weeks, but an employer must grant a request for a CFRA leave of less than two weeks’ duration on any two occasions and may grant requests for additional occasions of leave lasting less than two weeks. Will the same rule apply to Parental Leave?
  • If an employee wants to take Parental Leave following PDL, are the requisite 1,250 hours of service counted from the period immediately preceding her first day of PDL, rather than the first day of her subsequent Parental Leave, as it would be for CFRA baby bonding leave?
  • How will employment periods of 12 months be counted for Parental Leave?  Will an employee’s break in service of seven years or more not be counted, as it would generally not under the CFRA regulations (except for military service)?
  • Can the employee use mandatory paid sick leave during the Parental Leave even though that is not a permissible usage of paid sick leave under the Healthy Families, Healthy Workplaces Act?
  • Will there be a key employee exception as there is under the FMLA/CFRA?
  • Will employers be required to display a poster about Parental Leave rights or provide any other notices to employees?
  • Will employees be required to provide any advance notice of the need for leave?
  • Will there be any joint-employer liability, and, if so, what is the standard?

Best Practices

Don’t delay! With an effective date of January 1, 2018, there is no time to waste in getting compliant. At a minimum, employers should:

  • Update employee handbooks to include a Parental Leave policy;
  • Prepare a written guarantee of reinstatement that can be provided to employees who request Parental Leave; and
  • Train employees handling leaves of absence on this new type of leave and its requirements.

Consult legal counsel with any questions regarding application of the New Parent Leave Act.

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