Episode 37: CalChamber Employment Law Experts Review Questions on Minimum Wage Ordinances, Maternity Leave

Welcome to the Workplace, a podcast by Cal Chamber. I'm Erica Frank, Cal Chamber's General Counsel and Executive Vice president. And today back on the podcast, we have Cal Chambers, labor law experts Matthew Roberts and Bianca Saad. Welcome.

Thank you, Erica. It's exciting to be back.

Thank you. Happy to be here.

It is always a pleasure to have you here. As you take a step back from answering all of the those labor law helpline questions that we receive from businesses across California today, we're going to spice things up a little bit because both of you have completely different topics to talk about today. So let's get started. Bianca, let's start with you.

All right, so one of the common questions that we get on the helpline as well as at our seminars has to do with minimum wage. So, so we've got California's minimum wage. And the 2019 rate for minimum wage right now is $11 an hour for those smaller employers with 25 or fewer employees, $12 an hour for those larger employees with 26 or more employees. And that rate's going to be going up a dollar per hour for each of those rates for 2020. Where it gets complicated is that we also, in addition to California, have the California rate, we have those local minim rates. And right now we are pushing 30 by 2020, we will be above 30 for minimum wage rates.

30? Not $30 an hour, but 30 localities that have their own minimum wage rate.

That's exactly right. So come 2020, we will have more than 30 localities that have their own separate and higher than California minimum wage rates.

Bianca, how do businesses even know about this?

Yeah, it can be tricky.

We try to advise and let employers know that these rates are there. Certainly our members, they have the resources to go and look at the maps and you can see where based on where your employees work because it's not just where your business is located. So then that can be a dicey piece and it's just something that you have to really kind of just be look out for as a California employer because they're popping up left and right is what we've seen has been the trend over the years.

So Bianca, I know that you are doing your best to field all of those calls from employers wanting to make sure that they're paying the appropriate minimum wage. Are there other resources that Cal Chamber offers to help employers not only identify which localities have a minimum wage rate, but help them figure out how to apply the minimum wage and to which employees?

Yeah, that's a great question. So on our HR California website, We have a very, very thorough section that's dedicated only to local ordinances and not just the minimum wage ordinances, because there are other paid sick leave ordinances that apply to certain localities as well as a handful of others. San Francisco comes to mind because they certainly have the most out of any other locality. But it's a really great resource because it breaks it down by how to determine whether or not your sub to this ordinance what the minimum wage rate is or what the other rules, if you will, are to follow. A lot of them come with their own posters that must be posted which are also available on Cal Chambers store if you have poster requirements, as well as record retention requirements, among many, many other things. And they all vary just enough to be dangerous to wear. Just because you know what, what the rules are of one minimum wage or other local ordinance, it does not mean that that's going to be the case for the next city over.

So, Bianca, do you often receive calls from employers that have employees that cross many locality lines? If that's the right way to phrase it, yes, absolutely.

Especially in the Bay Area because there are so many. So you've got places like Berkeley, Oakland, San Francisco, Emeryville, they all have their own rates. And so all takes, generally speaking, it's two hours or more in a calendar week or a particular week that an employee is going to be subject to this minimum wage rate. So if you've got employees who are spending time in various localities, you really have to track to know, okay, the employee worked X number of hours for this particular pay period at this particular rate versus maybe the city over. So, yes, it's something that we do get a lot of questions about.

So when you're explaining this to our members and to employers, are they freaking out?

Yeah, sometimes. Because depending on again, the number of employees you have that are traveling and you know, it can be quite an administrative headache. One approach that some employers choose to take because of that administrative headache is they will just take the highest minimum wage rate that they know that they're going to be subject to and they'll pay it across the board.

I could see how some employers would choose to do that, although that just means it's a hit on the bottom line. Absolutely. Are there penalties that go along with a violation of the local requirements?

Yeah, that's a great question. There are penalties. Employers who violate can be subject to penalties, fines, and not just that, but also civil suits as well. So it can be quite expensive. The penalties and fines can increase by the number of viol as the days Go on. They can add up. So it is definitely something to be aware of.

And one more question, because this is so fascinating, but California's minimum wage has incrementally been increasing over the years. Do these local ordinances also increase on an annual basis or on some type of basis?

Yes, great question. Yes, most of them do have increases, and they'll either happen mid year or they'll happen at the beginning of the year. So again, each one is a little bit different, but they do have their own schedule that generally on an annual basis, they will increase.

Wow, that is a lot. I can understand why you probably get a lot of questions on that issue. Mr. Roberts, how are you today?

I'm doing great. Erica, how are you doing?

I'm doing well, thank you. So tell me about some of the calls you've been receiving since the last time we spoke.

Yeah, there's been quite a few calls recently about, quote, unquote, maternity leave. Oftentimes a member will call in and say, I have a pregnant employee who will be going out on maternity leave. What do we have to do? What steps do we have to take? And there's a lot that goes into that question. The first thing is that maternity leave isn't exactly a precise term that we use in California for what's otherwise known as baby bonding or pregnancy disability leave. What I like to talk about with members in both the seminars is that it's important to use precise terms when talking about human resources or California law, because these terms have meaning. And when you talk about something like maternity leave, there's a whole wide range of laws that are implied when you talk about maternity leave, and it's best to talk about each one individually.

So give me an example.

Sure. So the laws that may apply when you're talking about maternity leave are things like pregnancy disability leave, the FMLA or the CFRA that we discussed about last time, a new law that was passed a couple years ago called the New Parent Leave Act. We're also talking about wage replacement issues such as state disability insurance and paid family leave. And so, as you can see, there's a lot of different areas that come up when you talk about maternity leave. One of the biggest misnomers about it is that it only applies to mothers or to the childbearing parents, when in reality the other parent under some of these laws also has statutory leave rights.

Okay. So I suppose that when you're speaking with members, a lot has to do with the size of the company. Again, like we've talked about before, is this the Birthing parent or the non birthing parent, what are some other things that you need to consider?

Yeah, so what you need to consider mostly is how these leaves interact with each other. And of course, in our seminars, we talk for hours and hours about how these leaves interact with each other on a podcast. Couldn't possibly cover them all. But with the size of the employers, things like pregnancy disability leave, which is for the pregnant parent who is disabled because of the pregnancy, that's only for any employer with five or more employees is covered. When you're talking about baby bonding, such as under the California Family Rights Act, CFRA or FMLA, that's the same 50 or more employees threshold applies there. The new law we talked about, New Parent Leave act, applies to employers with 20 or more employees. And so that's the first step we talk about when we get on the phone. I say, okay, well, how many employees.

Do you have and how long is the leave that they're entitled to under those various laws that you just mentioned?

Well, that just adds to the fun because it's different depending on what law it is. Pregnancy Disability or pdl. As you can see, this is a real big Alphabet soup. PDL is up to 17 1/3 weeks or 4 months, but not guaranteed that they can take it all. They can only take it if their condition is certified as a disability condition by a medical provider. So a common thing I get with the members who call in, say, oh, my employee said they're taking pregnancy disability leave. And so I asked them, I say, well, did they give you a medical certification? Oh, no, she just said she's taking it. And I said, well, that's one of the steps you need to figure out. Because PDL can only be taken when a doctor certifies that she has this disabling condition. The employee can't just say, I'm taking maternity leave. Which is why it's important to know the difference between these different leave laws.

I could see how that happens quite frequently.

Quite frequently. And then with CFRA and FMLA, those are 12 weeks. As we've discussed before, the new Parent Leave act is also 12 weeks. And that's only for baby bonding has nothing to do with a disabling condition. So once the baby is born and the birthing parent is healthy and the other parent wants to, they can take baby bonding leave solely for the purposes of bonding with their baby up to 12 weeks within the first year after the baby was born.

Okay, so you talked about wage replacement under SDI and the Paid Family Leave act, do you get questions from members saying, well, my employee wants to take paid family leave.

Yes. And this is one of those ones where everyone gets confused. They say, oh, my employee is going to take paid family leave to bond with their baby. And I say, well, California didn't do us any favors since we already have to know so much. But when they describe something as paid family leave, people assume it's a leave of absence, when in fact it's actually wage replacement. So the way those things kind of work is if you qualify for paid family leave for baby bonding, it's just wage replacement. You apply to the state's Employment development department for wage replacement because you're taking time to baby bonding. It's not a leave of absence, which is the biggest problem. I get that all the time. And in fact, very recently I had a conversation with an employer that was having trouble with differentiating the two between baby bonding leave and PFL or paid family leave.

I can understand how that happens because like you said, the name attached attached to wage replacement benefits really doesn't speak to that. It speaks to a leave of absence.

Yeah, very common to be confused by that so much. So we have about seven or eight charts up on HR California, our website, that I go and I direct the members to. I say, instead of having a 30 minute conversation with me in which everybody is confused by the end of it, let me direct you over to the website, because on the website we have a great number of forms and tools that you can use and we have leave interaction charts that we also provide during our seminars. And those go through great lengths to show you how each of the leaves interact with each other, when one applies, when one doesn't apply, and then showing you on the bottom of the chart when you're on one type of leave, this is the kind of wage replacement that applies. And then this is the other if you're on a different type of leave.

Wow. Well, thank you. That's a lot of information. Boy, both of you both have some very interesting topics to talk about and so divergent from the other. I can see how the Labor Law Helpline is used very frequently by Cal Chamber members and is a tremendous resource to the business community. So thank you.

Thank you.

Thank you, Erica.

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