NOTE: Because the COVID-19 situation is dynamic, with new governmental measures each day, employers should consult with counsel for the latest developments and updated guidance on this topic.

On April 7, 2020, the San Francisco Board of Supervisors adopted an emergency ordinance (the "PHELO") that requires private employers with 500 or more employees to provide paid public health emergency leave during the COVID-19 public health emergency (“PHE”).  This ordinance is one of a number of situations where local jurisdictions have enacted laws to require companies that are not otherwise covered by the Families First Coronavirus Response Act (“FFCRA”) to provide additional sick time to its employees.  Mayor London Breed is expected to sign the ordinance, which will become effective upon her signature.  Unlike the FFCRA, which is scheduled to remain effect through December 31, 2020, the PHELO will remain in effect until the 61st day following enactment (unless San Francisco enacts a separate measure extending the timeframe) or the COVID-19 PHE ends, whichever occurs first. Although the PHELO says PHE leave expires when the law does, employers can extend an employee’s access to PHE leave. Notably, employers do not receive tax credits or monetary relief for providing PHE leave.

In certain respects, the San Francisco ordinance is similar to other proposals in Los Angeles and San Jose, in that it contains minimal information and is based loosely on the federal FFCRA, which took effect on April 1.

Until the San Francisco Office of Labor Standards Enforcement (“OLSE”) creates rules and guidelines, the pre-existing San Francisco Paid Sick Leave Ordinance (the "PSLO") rules and guidelines will apply, which provides a clearer path for employers.

Covered Employers and Employees

The PHELO will apply to private employers with 500 or more employees. Although the law does not say which employees to count when assessing that threshold, San Francisco has, to date, not taken a geographically limited approach, so that all employees of a company, regardless of where they work, should be counted for purposes of determining coverage by the PHELO. Moreover, the PSLO counts all workers, including full-time, part-time and  temporary employees.

The PHELO will cover employees that performed 56 or more hours of work in San Francisco during the 365 days immediately preceding the law's effective date, including employees that are part-time, temporary and Welfare-to-Work Program participants. Similar to the federal FFCRA, the PHELO allows an employer of an employee who is a health care provider or an emergency responder to elect to exclude such an employee from the law's requirements. For purposes of this potential exception, San Francisco uses the broad definitions from the FFCRA rules, as follows.

• Health Care Provider: Anyone employed at any doctor’s office, hospital, health care center, clinic, postsecondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions. This definition includes any individual employed by an entity that contracts with any of these institutions described above to provide services or to maintain the operation of the facility where that individual’s services support the operation of the facility. This also includes anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments. This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is a health care provider necessary for their response to COVID-19.

• Emergency Responder: Anyone necessary for the provision of transport, care, healthcare, comfort and nutrition of such patients, or others needed for the response to COVID-19. This includes but is not limited to military or national guard, law enforcement officers, correctional institution personnel, fire fighters, emergency medical services personnel, physicians, nurses, public health personnel, emergency medical technicians, paramedics, emergency management personnel, 911 operators, child welfare workers and service providers, public works personnel, and persons with skills or training in operating specialized equipment or other skills needed to provide aid in a declared emergency, as well as individuals who work for such facilities employing these individuals and whose work is necessary to maintain the operation of the facility. This also includes any individual whom the highest official of a state or territory, including the District of Columbia, determines is an emergency responder necessary for their response to COVID-19.

Note, however, that according to comments from Supervisor Gordon Mar, a PHELO co-sponsor, next week the Board of Supervisors will consider a measure specific to health care providers (possibly emergency responders – as of publication of this article, the proposed text is unavailable).

Unlike the federal FFCRA, the PHELO provides a potential exception for employers with unionized workforces. Any or all of the law's requirements do not apply to employees covered by a bona fide collective bargaining agreement, to the extent the requirements of the PHELO are expressly waived in the CBA in clear and unambiguous terms.

Amount & Value of PHELO Leave

When the ordinance takes effect, employers must provide each covered employee an amount of PHE leave equivalent to what the federal FFCRA requires for emergency paid sick leave. However, unlike with the definition of health care provider and emergency responder, the PHELO cites the FFCRA statute, rather than the PSLO rules. The San Francisco OLSE may yet clarify or confirm which rules should be used by employers. In the meantime, the FFCRA statutory standards provide the following leave entitlements:

• Full-Time Employees: Entitled to 80 hours.
• Part-Time Employees: Entitled to a number of hours equal to the number of hours that such employee works, on average, over a 2-week period.
  
  • In the case of a part-time employee whose schedule varies from week to week to such an extent that an employer is unable to determine with certainty the number of hours the employee would have worked if such employee had not taken leave, the employer must use the following in place of such number:
    • A number equal to the average number of hours that the employee was scheduled per day over the 6-month period ending on the date on which the employee takes leave, including hours for which the employee took leave of any type.
    • If the employee did not work over such period, the reasonable expectation of the employee at the time of hiring of the average number of hours per day that the employee would normally be scheduled to work.

The PHELO does not prevent an employer from providing or advancing additional paid time off to an employee.

Unlike the federal FFCRA, the PHELO allows employers to offset the amount of PHE leave by the amount of paid leave they provided employees on or after February 25, 2020, for any reason the ordinance identifies. Employers, however, cannot count "previously accrued hours" for offset purposes. For example, if employers voluntarily allowed employees during this period to use their pre-existing San Francisco PSLO hours, employers cannot use those hours to offset PHELO leave obligations. Like the federal FFCRA, under the PHELO, PHE leave is in addition to any leave employers were required to provide employees, e.g., California and/or San Francisco paid sick leave, and/or non-COVID-19 pre-existing employer-provided paid leave benefits. Moreover, the PHELO permits employees to use PHE leave before using other accrued paid time off, or may voluntarily choose to use other employer-provided accrued paid time off before using PHE leave (but an employer may not require this). Significantly, the PHELO prohibits employers from changing any paid time off policies on or after the ordinance's effective date except to provide additional paid leave.

Covered Uses & Family Members

Employees who are unable to work – either at their customary place of work or by means of telework – can use PHE leave for a number of reasons. It is important, first, to highlight a key difference between the FFCRA and the PHELO: employers must make PHE leave available, regardless of whether or when the employee is scheduled to work. For example, during the hearing, Supervisor Mar noted the law applies to furloughed employees who experience a qualifying event.  The PHELO defines qualifying event as including:

1.  An employee being subject to an individual or general federal, state, or local quarantine or isolation order related to COVID-19.
   
   1. Includes, but is not limited to, an employee who is unable to work due to the shelter-in-place order issued by the governor and/or San Francisco, any subsequent orders requiring residents to stay in their homes during the emergency, or shelter-in-place orders issued by other San Francisco Bay Area jurisdictions.
   2. Includes an employee who is a member of a "vulnerable population" per the San Francisco Department of Public Health and unable to work due to recommendations in orders issued by the Department, or any order issued by the governor or Bay Area jurisdictions requiring additional restrictions for vulnerable or high-risk populations. The "vulnerable population" includes people who are 60 years old and older, people with certain health conditions such as heart disease, lung disease, diabetes, kidney disease and weakened immune systems, and people who are pregnant or were pregnant in the last two weeks.

2. An employee being advised by a health care provider to self-quarantine.

3. An employee experiencing symptoms associated with COVID-19 and seeking a medical diagnosis.

4. An employee caring for a family member who is subject to an order described in 1, has been advised as described in 2, or is experiencing symptoms as described in 3.

5. An employee caring for a family member whose school or place of care has been closed, or whose care provider is unavailable, due to the PHE.

6. An employee experiencing any other substantially similar condition specified by the local health officer, or under the federal FFCRA [Section 5102(a)(6)] by the U.S. Secretary of Health and Human Services.

As a condition of taking PHE leave, employers cannot require employees to take leave in increments of more than one hour.

The PHELO adopts the definition of family member in San Francisco's PSLO: child; grandchild; grandparent; parent; sibling; spouse or registered domestic partner. Additionally, if employees do not have a spouse or registered domestic partner, they may designate one person for whom they may use PHE leave.

Requesting & Documenting Leave

Employers can require employees to follow reasonable notice procedures to use PHE leave, but only when the need for leave is foreseeable. Moreover, employers can require employees to identify the basis for requesting PHE leave, but they cannot require the employee to disclose health information. At this time, it is unclear whether the PHELO will incorporate PSLO standards for unforeseeable absences. Unless San Francisco OLSE issues guidance saying otherwise, the existing PSLO standards allow employers to take reasonable measures to verify that employees use leave for a covered purpose, if verification does not require employees to disclose more information than necessary to make that determination. The PHELO states that employers cannot require other documentation, including but not limited to a doctor’s note.

Paying PHE Leave

For pay rate purposes, the PHELO incorporates standards in the PSLO. For nonexempt employees, employers must either calculate the rate in the same manner as the regular rate of pay for the workweek in which the employee uses leave (whether or not the employee actually works overtime in that workweek) or calculate the rate by dividing the employee’s total wages – excluding overtime premium pay – by the employee’s total hours worked in the full pay periods of the prior 90 days of employment. For exempt employees, employers calculate the rate in the same manner they calculate wages for other forms of paid leave time. As for timing, employers must pay PHE leave no later than the payday for the next regular payroll period after an employee takes PHE leave. Similar to the PSLO, the PHELO does not obligate employers to provide or pay for any unused PHE leave when employment ends.

Notice, Paystub & Recordkeeping Requirements

Within three days after San Francisco OLSE publishes and makes available a new mandatory notice, employers must make that notice available in a manner calculated to reach all employees: by conspicuously posting at the workplace; via electronic communication; and/or by conspicuously posting on an employer’s web- or app-based platform. The notice must be in English, Spanish, Chinese, and any language spoken by at least 5% of employees who are, or were prior to the public health emergency, at the workplace or job site.

The PHELO also contains a paystub requirement for employers subject to the paystub requirement under California's paid sick leave law. To the extent feasible, on the same written notice state law requires, employers must set forth the amount of PHE leave available. If an employer provides unlimited paid time off to an employee, it may satisfy the requirement by indicating on the notice or the itemized wage statement “unlimited.”

Employers must retain records related to PHE leave in the same manner and to the same extent as records under the San Francisco PSLO, i.e., records must be kept for at least four years.

Prohibitions, Penalties & Damages

In many respects, the PHELO prohibitions mirror those in the PSLO, e.g., employers cannot require employees to find a replacement worker or interfere with employees attempting to or exercising their rights; policies cannot count PHE leave use as an absence that may lead to or result in discipline, discharge, demotion, suspension, or any other adverse action. The PHELO also expands on PSLO protections. The PHELO anti-retaliation provision not only prohibits discharging, demoting, suspending, discriminating, or taking adverse action, but also bars any reduction of employee benefits, due to an employee’s exercise of their PHELO rights. Except as otherwise provided by potentially forthcoming rules or guidelines, the PSLO administrative and civil enforcement provisions apply to the PHELO, so employees can file private lawsuits and recover numerous types of damages, and OLSE can assess administrative penalties.

Next Steps

Depending on how soon the mayor signs the ordinance, covered employers could have very limited time to develop policies, procedures, and practices to implement the law. In the absence of the OLSE publishing guidelines and rules, employers should consult with counsel to determine, as best as possible, what the PHELO requires.