Managing Medical Leave in California

Editor's Note: This content has been updated to reflect changes made by Senate Bill 616 to the Healthy Workplaces, Healthy Families Act, effective Jan. 1, 2024.

Overview

Managing medical leaves of absence in California is challenging for HR professionals due to the state's multiple leave laws and their interactions with federal laws and employer policies. California employers must consider both state and federal laws, such as the California Family Rights Act (CFRA), California Pregnancy Disability Leave (PDL), and the Family and Medical Leave Act (FMLA).

Medical leaves of absence may also involve consideration of disability leave under the California Fair Employment and Housing Act (FEHA), California workers' compensation laws, and the Americans with Disabilities Act (ADA).

Although some provisions of the California leave laws mirror the federal FMLA, others do not. Therefore, employers must be aware of and comply with all legal requirements.

Compliance with myriad employment laws related to medical leaves of absence is critical for any organization with employees in California because liabilities for noncompliance can be costly from legal, employee relations and employer brand perspectives. Employers are well-advised to consult with an employment law attorney with experience in both California and federal leave laws when administering medical leaves. 

Job Protected Leave

California Family Rights Act

The CFRA partly mirrors the federal FMLA. The overall intent of the CFRA is to mandate that covered employers help employees balance work and personal medical demands while maintaining reasonable job protections. The CFRA provides job-protected medical leave for eligible employees with unpaid time off for their own serious health conditions; to care for a covered family member with a serious health condition; for bonding with a newborn child, a foster child or an adopted child; and for a qualifying military exigency. Though the CFRA closely resembles the FMLA, the two laws do differ. 

Employer Coverage

The CFRA applies to private employers that have employed at least five employees within the United States, the District of Columbia or a U.S. territory for 20 or more calendar workweeks during the current or preceding calendar year. The 20 workweeks do not have to be consecutive. Public agencies are covered employers without regard to the number of employees. Public as well as private elementary and secondary schools are also covered employers without regard to the number of employees.

California employers with operations in other states must count all employees when determining if they meet the CFRA's test of five employees during 20 workweeks, regardless of the number of hours worked. In addition, employees from temporary or staffing agencies or professional employer organizations (PEOs) must be counted if a joint employment relationship exists.

Although the CFRA does not specifically address joint employment, the California Code of Regulations §7297.10 indicates that, barring inconsistencies with state law, the California Department of Industrial Relations, Division of Labor Standards Enforcement (DLSE), incorporates the federal regulations interpreting the FMLA. FMLA regulation §825.106 provides joint employment guidance.

Employee Eligibility for Leave

In addition to working for a covered employer, an employee must meet two eligibility requirements to take CFRA job-protected leave:

• The employee must have 12 months of service with the employer.
  
• The employee must have worked at least 1,250 hours in the 12-month period immediately before the date the CFRA leave is to begin.

Qualifying Events

• The CFRA provides eligible employees up to 12 weeks of protected, unpaid leave in a 12-month period for the following qualifying events:

  • Bonding with or caring for a newborn child of the employee or the placement of a child in connection with the adoption or foster care of the child by the employee. (Pregnancy disability leave is not covered by the CFRA).
  • Care for the employee's spouse (including those in same-sex marriages), registered domestic partner, child (of any age), child of domestic partner, parent, parent-in-law, sibling, grandparent, grandchild or designated person.
  • An employee's own serious medical condition that prevents the employee from performing his or her job duties.
  • A qualifying military exigency related to the covered active duty or call to covered active duty of an employee's spouse, domestic partner, child (of any age), or parent in the United States Armed Forces, as specified in Section 3302.2 of the Unemployment Insurance Code.
    

Interaction with the FMLA

The CFRA and the FMLA differ in many ways, and California employers must know the requirements for each. In some cases the CFRA is more generous, but in other areas the FMLA is more generous and also more expansive than the CFRA. The California Code of Regulations §7297.10 provides that to the extent that the CFRA and the FMLA are not inconsistent, the more generous statute will apply.

Review a chart of the differences and see further explanations below:

• The 12 workweeks of family care and medical leave may be taken under state law concurrently with the FMLA, except for leave taken under the FMLA for disability due to pregnancy, childbirth or related medical conditions. California PDL covers leave taken due to pregnancy, childbirth or related medical conditions.
• Unlike under the FMLA, registered domestic partners in California are considered spouses. The FMLA does not cover leave taken for a registered domestic partner's serious health condition. Theoretically, an employee could take 12 weeks of leave to care for a registered domestic partner under the CFRA, then take an additional 12 weeks under the FMLA to care for a child with a serious health condition.
• Under CFRA regulations, the employer may require, or the employee may elect to use vacation time or other paid leave; however, the use of sick leave is reserved for the employee's own serious health condition or other reasons mutually agreed upon between the employer and the employee. While the FMLA requires the use of paid leave be addressed in the employer's policy, there is no such requirement under CFRA. According to CFRA regulations, "an employee receiving any form of disability payments is not on "unpaid leave" and, therefore, an employer may not require the employee to use paid time off, sick leave, or accrued vacation." The same principle applies to employees receiving paid family leave through the state.
• The FMLA provides care for ill or injured service members, and an employee who is the spouse, child, parent or next of kin of an injured covered service member may take a total of 26 weeks of leave during a 12-month period to care for the covered service member. However, the leave is covered under the CFRA only if the family member is a covered CFRA employee (i.e., a spouse, child or parent). If "next of kin" is not within these categories, CFRA leave would not be exhausted when FMLA leave is used for this purpose. Furthermore, CFRA leave is for only 12 weeks, so the last 14 weeks would be FMLA leave only.
• Under the FMLA, eligible employees may work an intermittent or reduced schedule for baby bonding only if the employer agrees. Under the CFRA, though, employers must allow employees to work an intermittent or reduced schedule for baby bonding if requested. The minimum intermittent leave duration is two weeks for CFRA-only baby bonding leave, but employers must grant a request for leave of less than two weeks' duration on any two occasions.
• The FMLA stipulates that if both spouses work for the same employer, leave is limited to 12 weeks between the spouses if the leave is taken to care for the employee's parent with a serious health condition, for the birth of the employee's son or daughter, to care for the employee's child after birth, or for placement for adoption or foster care. Each spouse's unused portion of FMLA leave would still be available for other purposes, such as for the employee's or child's serious health condition. If one spouse-employee is not FMLA-eligible, the other eligible FMLA spouse-employee could take the entire 12 weeks of leave. The CFRA does not permit an employer to combine weeks of leave between employees for any reason.

• Under the FMLA, employers can ask for a diagnosis of an employee's serious health condition when necessary to support the need for leave. If additional leave is requested at the end of the period that the health care provider originally estimated the employee needed for family leave, the employer may require the employee to obtain recertification. However, under the CFRA, regulations specify that an employer cannot ask for a diagnosis, but the employee may choose to disclose the diagnosis. As such, California employers should use the Certification of Health Care Provider form Certification of Health Care Provider form provided by the California Civil Rights Department (CRD) rather than the FMLA medical certification forms to avoid the unauthorized disclosure of a medical diagnosis.

• FMLA regulations authorize employers to request second and third medical opinions regarding the serious health condition of a family member, same as for an employee. No such authorization is allowed under CFRA regulations. Even if the employer doubts the medical certification for an employee needed to care for a family member, the employer must accept the certification. Employers can ask for recertification only if the original date of return has expired.

This is not an exhaustive list, but it does provide some of the most significant differences that will affect the majority of employers.

See 29 C.F.R. §825 The Family and Medical Leave Act of 1993 and California Government Code of Regulation—CFRA 12945.2.

CFRA Posting Requirements

Employers with five or more employees must post the CRD's notice Family Care and Medical Leave (CFRA Leave) and Pregnancy Disability Leave (or create their own).

Family and Medical Leave Act

The FMLA closely mirrors the CFRA, but, as noted above, there are differences. Employee rights are covered under both regulations.

Eligibility

To be eligible for job-protected FMLA leave, an employee must work for a covered employer and must meet the following requirements:

• Have worked for that employer for at least 12 months.
• Have worked at least 1,250 hours during the 12 months before the start of the FMLA leave.
  
• Work at (or receive direction from) a location where at least 50 employees are employed or within 75 miles of that location.

A covered employer must grant an eligible employee up to a total of 12 workweeks of unpaid leave in any 12-month period for one or more of the following reasons:

• The employee's own serious health condition.
• The birth of a child or the placement of a child with the employee for adoption or for foster care.
• To care for a spouse, child or parent with a serious health condition.
• Any qualifying exigency arising out of the fact that the spouse or a son, daughter or parent of the employee is on covered active duty (or has been notified of an impending call or order to covered active duty) in the armed forces. An eligible employee is entitled to a total of up to 26 workweeks of service member caregiver leave during any single 12-month period if the employee is the spouse, child, parent or next of kin caring for a covered military service member or veteran. This leave is available during only one single 12-month period and taking this leave does not limit the availability of leave for other FMLA-qualified reasons during any other 12-month period.

See 29 C.F.R. §825 The Family and Medical Leave Act of 1993 and FMLA Poster.

Pregnancy Disability Leave

The  FEHA, the same state law that prohibits discrimination, provides protection for pregnancy-related disabilities. PDL allows employees disabled by pregnancy, childbirth or a related medical condition to take up to four months (defined as 17.3 weeks or 122 days, which equals one-third of a calendar year) of job-protected leave. It does not provide for any time off for the birth or placement of a child in foster care or adoption.

Thus, a woman with a difficult pregnancy or childbirth is entitled to up to 17.3 weeks or 122 days of disability leave (with the proper medical certification), and the employer cannot discriminate against her on the basis of the pregnancy or pregnancy-related disability. Employers should also note that additional leave time under the FEHA as a reasonable accommodation could be triggered if an employee has a qualifying disability.

Employer Coverage

PDL applies to private employers that employ at least five or more full- or part-time employees. California public employers are covered regardless of the number of employees. A not-for-profit religious association or religious corporation that is exempt from federal and state income tax is not an employer under the meaning of this act.

Eligible Employees

Unlike under the CFRA and the FMLA, PDL has no length-of-service or hours-worked requirement before an employee disabled by pregnancy, childbirth or related medical condition is entitled to the leave. Therefore, a newly hired employee is immediately eligible for such leave.

Duration of Leave and Qualifying Events

PDL can be taken for any period(s) of actual disability caused by the employee's pregnancy, childbirth or related medical condition, per pregnancy. A woman is disabled by pregnancy if, in the opinion of her health care provider, she is, among other things:

• Unable, because of pregnancy, to perform any one or more of the essential functions of her job or to perform any of these functions without undue risk to herself, to her pregnancy's successful completion or to other persons.
• Suffering from severe morning sickness.
• In need of taking time off for prenatal or postnatal care, bed rest, gestational diabetes, or pregnancy-induced hypertension or preeclampsia.
• In need of taking time off for postpartum depression, childbirth, loss or end of pregnancy, or recovery from childbirth, loss or end of pregnancy.

An employee is entitled to up to four months of PDL while she is disabled by pregnancy, childbirth or related medical condition as determined by her health care provider. For purposes of PDL, "four months" means time off for the number of days the employee would normally work within the four calendar months (one-third of a year, or 17⅓ weeks or 122 days), following the commencement date of PDL.

For a full-time employee who works five eight-hour days per week, or 40 hours per week, "four months" means 693 hours of leave entitlement, based on 40 hours per week times 17.33. Employees working a part-time schedule would have their PDL calculated on a pro-rata basis.

PDL permits an employer to require an eligible employee to obtain a certification from her health care provider of her need for PDL, or the medical advisability of an accommodation or a transfer. A model medical certification for pregnancy disability is available from the CRD.

Interaction with the FMLA and the CFRA

PDL runs concurrently with FMLA leave, but not with CFRA leave. Pregnancy is not covered or considered a serious health condition under the CFRA, and women with difficult pregnancies are not entitled to protected leave under the CFRA. CFRA leave can be used by an employee only following the birth of a child to care for or bond with a healthy newborn or to care for a newborn with a serious health condition. Instead, disabilities related to pregnancy are covered under PDL and the FMLA, and possibly the FEHA as a disability-related reasonable accommodation.

Even if an employee has no complications with her pregnancy, she could be entitled to PDL if she is disabled due to a pregnancy-related medical condition post-childbirth as determined by her health care provider.

See, How to Manage Pregnancy-Related Leave in California for more guidance.

Posting PDL Notices

Organizations must post notices about employees' right to PDL and give an employee a copy of the appropriate notice as soon as practicable after the employee tells the employer of her pregnancy. Notices can be electronically posted, but they also need to be in employee handbooks. 

See CRD Posters, guides and fact sheets

Reproductive Loss Leave

Effective Jan. 1, 2024, employers with five or more employees must allow an employee who has worked for the employer for at least 30 days to take up to five days of unpaid leave following a reproductive loss such as, miscarriage, stillbirth or an unsuccessful assisted reproduction. Employees may choose to use any accrued and available paid sick leave or other paid time off. Employers are prohibited from retaliating against any employee for requesting or taking leave for a reproductive loss.

See Senate Bill 848 and California Establishes New Leave for Reproductive Loss.

Time Off for Victims of Domestic Violence or Sexual Assault

California  Labor Code §230.1 requires an employer with 25 or more employees to provide victims of domestic violence or sexual assault unpaid time off for up to 12 weeks to obtain help from a court; to seek medical attention; to obtain services from an appropriate shelter, program or crisis center; to obtain psychological counseling; or to participate in safety planning, such as permanent or temporary relocation.

Labor Codes §230 and §230.1 currently prohibit an employer from discharging or discriminating or retaliating against an employee who is a victim of domestic violence or sexual assault for taking time off from work in connection with court proceedings or to seek medical attention and other specified services as a result of these crimes against them.

S.B. 400 further extends the time-off protections to include employees who are victims of stalking. The law prohibits discharge, discrimination and retaliation against employees because of their status as victims of domestic violence, sexual assault or stalking if the employees/victims provide notice to their employers or the employers have actual knowledge of this status.

Employers are also required to provide reasonable accommodations to employees who are victims of domestic violence, sexual assault or stalking and who request an accommodation for their safety while on the employer's premises.

Reasonable accommodations may include the implementation of safety measures, such as:

• Job transfer.
• Job reassignment.
• Modified schedule.
• Changed work telephone.
• Changed workstation.
• Lock installation.
• Assistance in documenting domestic violence, sexual assault or stalking that occurs in the workplace.
• Implementation of safety procedures.
• Adjustment to job structure, the workplace facility or work requirements in response to domestic violence, sexual assault or stalking.
• Referral to a victim assistance organization.

As with disability accommodations, employers are required to engage in a timely, good-faith interactive process with the employee to determine effective reasonable accommodations.

An employer may request that an employee provide a written certification that the employee is a victim of domestic violence, sexual assault or stalking, and that the requested accommodation is for the safety of the victim while at work. The employer may request recertification every six months.

Any documentation provided to an employer identifying an employee as a victim of domestic violence, sexual assault or stalking must be kept confidential and must not be disclosed by the employer except as required by law or as necessary for the safety of employees in the workplace. The employer must give the employee notice before any disclosure of the information is made.

The employee may request a new accommodation based on changed circumstances, and, in such a case, the employer must repeat the interactive process with the employee.

Employees are required to notify their employers when an accommodation is no longer needed.

Employers are prohibited from retaliating against an employee who has requested a reasonable accommodation, whether the request was granted or not. S.B. 400 authorizes reinstatement, back pay and injunctive relief for violations of the law.

Voluntary Drug or Alcohol Rehabilitation Leave

Employers with 25 or more employees must provide unpaid time off for employees voluntarily attending drug or alcohol rehabilitation programs absent undue hardship on the employer as a form of reasonable accommodation. The law does not provide a specific amount of time off; instead, employers must provide reasonable time off that does not cause undue hardship. Sometimes, the length of the rehabilitation program is used to determine what is reasonable. Employees may use accrued paid sick leave, and the employer may permit the use of PTO or vacation leave. This type of leave may run concurrently with the FMLA or the CFRA.

See California Labor Code §1025.

Interaction with the FMLA, the CFRA and the ADA

This type of time off may also be covered by the FMLA or the CFRA if the employee is otherwise eligible and meets the criteria for a serious health condition. If so, employers should follow the approval and medical certification process under the FMLA or the CFRA and inform the employee that the time off is designated as FMLA or CFRA time. The two leave obligations may run concurrently.

Alcoholism and drug addiction may also be covered under the FEHA disability regulations and the ADA, requiring the employer to provide reasonable accommodations.

See Are employees undergoing treatment for drug and alcohol addictions covered under the ADA?

Disability Leave as a Disability Accommodation

California  employers with five or more employees, under the FEHA disability regulations, and employers with 15 or more employees, under the ADA, may need to provide time off as a form of a reasonable accommodation to an employee with a disability. Length is not specified and is on a case-by-case base. Reinstatement is generally guaranteed subject to undue hardship exception.

See When Must Employers Provide Leave Under the ADA?

Wage Replacement and Paid Leave Rights

California also has several laws regarding wage replacement for employees on family or medical leave. Employers need to be mindful of these laws when managing leave for employees in California.

Healthy Workplaces, Healthy Families Act of 2014/California Paid Sick Leave

The Healthy Workplaces, Healthy Families Act of 2014 (HWHFA) as amended by SB 616 requires almost all employers with employees in California to provide their employee(s) with paid sick leave. This act provides for job protection as well as for employer paid leave.

Employer Coverage

California paid sick leave applies to all employers regardless of size that have at least one employee who works more than 30 days in one calendar year. The law also applies to employers based outside California with employees who work 30 or more days within a year in California.

Employee Eligibility

The law applies to all full-time, part-time and temporary employees. The law does not cover a few narrow categories of workers, including those who provide in-home supportive services (who are covered under the IHSS Paid Sick Leave Program), and those covered by collective bargaining agreements (CBA). However, employees working under a CBA must be allowed to use any paid sick leave for the same reasons as indicated under the act.

Upon oral or written request, the employer must allow employees to use their accrued sick leave for the following:

• The diagnosis, care or treatment (including preventive treatment) of an existing health condition for the employee or the employee's family member.
• An employee who is the victim of domestic violence, sexual assault or stalking.

"Family member" is defined as including:

• A child (regardless of age), including a biological, adopted or foster child; legal ward; or a child to whom the employee stands in loco parentis.
• A biological, adoptive or foster parent; stepparent; legal guardian of an employee; the employee's spouse or registered domestic partner; or a person who stood in loco parentis when the employee was a minor child.
  
• A parent-in-law.
  
• A spouse.
• A registered domestic partner.
• A grandparent.
• A grandchild.
• A sibling.
  
• A designated person.
  

Amount of Leave

Employees must accrue paid sick leave at the rate of one hour for every 30 hours worked, beginning at the start of their employment to a maximum accrual of 40 hours per year. Employees can use accrued paid sick days beginning on the 90th day of employment. Employers can offer more generous sick leave plans if they wish.

Alternatively, employers can provide an annual lump sum of leave that grants at least 40 hours or five days of sick leave for the year available immediately at the beginning of a yearlong period, except for initial hires who must be able to use 24 hours or three days of sick leave by the 120th day of employment, and 40 hours or five days of sick leave by the 200th day of employment. 

Employers must allow employees to carry over their unused sick leave balance from year to year, although accruals can be capped at 80 hours or 10 days. Employers can also prohibit employees from using more than 40 hours or five days of sick time per year, even if they have accrued more time. Accrued paid sick time is not required to be paid out upon termination of employment; however, it must be reinstated to the employee if he or she is rehired within 12 months. 

Interactions with Other Regulations

Employers that already provide paid leave (such as PTO, vacation or personal time) in amounts more than 40 hours a year do not have to offer any additional paid time off if the employee is allowed to take the time off for the same reasons covered by the paid sick leave law. However, employers should ensure that they are tracking employee sick leave use and provide written notice on the employee's wage statement or pay stub with the available balance.

In addition, all employers must comply with additional record-keeping, notice and posting requirements. Failure to keep the required records creates a presumption against the employer that the employee is entitled to the maximum number of hours provided for under the law. 

California paid sick leave and kin care

In 2016, California's kin care leave law (Labor Code §233) was amended to align with the HWHFA (paid sick leave law) by revising the definition of family members and the reasons for leave. Employers must allow employees to use half of their annual sick leave accrual for all the same reasons described in the paid sick leave law.

See CA Labor Code §233.

California paid sick leave, the CFRA and the FMLA

When CFRA leave is used for the employee's own serious health condition, the employee may elect, or the employer may require the employee, to use any accrued vacation time or other accumulated paid leave, including any accrued sick leave. Additionally, the employee may elect to use accrued sick leave for any other reason mutually agreed to by the employer.

With the broader definition of "family member," the employee may be entitled to time off under the California paid sick leave program and the CFRA that would not count against the employee's FMLA protected leave time.

California paid sick leave, SDI, PFL and workers' compensation

Any accruals the employee has on record for the California paid sick leave program or an employer's paid sick leave program can be used for the waiting periods associated with State Disability Insurance and workers' compensation wage replacement programs. In addition, an employer may coordinate benefits with the state to supplement Disability Insurance or Paid Family Leave with paid sick leave. See Integration/Coordination of State Disability Insurance (SDI) Benefits.

Local Paid Sick Leave Ordinances

California employers also need to consider local city/county paid sick leave laws. San Francisco became the first California city to offer paid sick leave in 2007. Ordinances in Oakland and Emeryville took effect in 2015, followed by a Los Angeles ordinance in 2016 and Santa Monica and San Diego in 2017. Employers will need to stay on top of developments with local laws as more cities and counties implement paid sick leave requirements. 

Kin Care Leave

Kin care does not provide additional leave, but it does require employers that provide paid sick leave to permit employees to use up to half of their accrued annual sick leave benefits to care for a sick family member. This law applies to all California employers—both public and private, regardless of number of employees. Leave taken under kin care is protected and may not be "counted against" or used as a basis for disciplining an employee for absenteeism. See California Labor Code §233.

The Michelle Maykin Memorial Donation Protection Act/Organ and Bone Marrow Donor Leave

Employer coverage

This paid leave law applies to private and public employers with at least 15 employees. Unlike the leave laws previously mentioned, this law does not specify the number of weeks in a year that the employer must employ 15 employees. An eligible employee is defined as an individual with at least a 90-day period of employment with the employer immediately preceding the date of leave. The law requires employers to provide up to 30 days of paid leave per year for an organ donation in any one-year period, and up to five days of paid leave per year for a bone marrow donation. As of January 1, 2020, an additional unpaid leave of up to 30 business days must be granted to an employee donating an organ. The leave may be taken in one or more periods of absences, but the combined total may not exceed the maximums allowed by law. 

See California Labor Code 1510, as amended by AB 1223.

General Provisions

• Employers must maintain group health plan coverage under the same condition as if the employee had been actively at work during the leave period. In regard to other benefits, the employer must continue to treat the employee as continuously employed during this leave period for the purpose of his or her right to salary adjustments, sick leave, vacation, PTO, annual leave or seniority.
• Employees may be required to take up to two weeks of earned sick or vacation leave for organ donation and up to five days for bone marrow donation.
• State employees who have exhausted all available sick leave must be permitted to take a leave of absence with pay for up to 30 days for the purpose of organ donation and up to five days for bone marrow donation. Employers must pay employees for the leave time if paid leave has not yet been earned or if it is exhausted.
• The employer can require an employee to provide written verification that the employee is an organ or bone marrow donor and that there is a medical necessity for the organ or bone marrow donation.
• Leave taken under this act does not run concurrently with leave taken under the FMLA or the CFRA.
• Employers must restore an employee to the same or equivalent position after return from leave.
• Covered employers must make reasonable efforts to keep information about an employee's treatment private.

Workers' Compensation

According to the California Department of Industrial Relations, the workers' compensation system is based on a trade-off between employers and employees. Employees are entitled to receive prompt, effective medical treatment for on-the-job injuries or illnesses no matter who is at fault and, in return, are prevented from suing employers over those injuries. All California employers are required by law to have workers' compensation insurance.

Workers' compensation insurance provides six basic benefits: medical care, temporary disability benefits, permanent disability benefits, supplemental job displacement benefits, vocational rehabilitation and death benefits.

Labor Code §132a also protects an injured employee's job by making it a misdemeanor for an employer to discriminate in any way, including discharge or threat of discharge, against an employee who has filed or is thinking about filing a workers' compensation claim or an employee who has received a workers' compensation award.

While the employee is on workers' compensation medical leave, the employer should treat the leave as a job protection under the CFRA and the FMLA as well. After leave is exhausted under the CFRA and the FMLA, employers will likely need to proceed into the interactive disability accommodation discussion to determine if additional leave can be accommodated under the ADA and/or the FEHA. In very limited cases of "business necessity," employers may replace and not reinstate an employee on workers' compensation medical leave; however, employers are strongly advised to seek legal counsel before doing so due to the protections of Labor Code §132a and the history of litigation associated with such terminations.

See Department of Industrial Relations—Workers' Compensation Employer Information.

California Wage Replacement Programs

The California Employment Development Department (EDD) administers the state Paid Family Leave (PFL) and Disability Insurance (DI) benefits through funds collected by payroll taxes. These programs provide wage replacement programs and do not provide job protection; however, other state and federal statutes such as the FMLA or the CFRA may provide job protection.

See Disability Insurance and Paid Family Leave Benefits.

Paid Family Leave Benefits

PFL insurance provides up to eight weeks of benefits for individuals who must take time off for the following reasons:

• To care for a seriously ill child, spouse, parent or registered domestic partner, grandparent, grandchild, sibling, or parent-in-law.
• To bond with the employee's new child or the new child of the employee's spouse or registered domestic partner.
• To bond with a child in connection with the adoption or foster care placement of the child with the employee or the employee's spouse or registered domestic partner.

Employees are not eligible for PFL if:

• They are claiming or receiving unemployment insurance or California DI benefits.
• They are receiving workers' compensation benefits at a weekly rate equal to or greater than the PFL rate.
• They fail to have an independent medical examination when requested to do so.

Additionally, an employee is not eligible for PFL benefits for any day that another family member is able and available for the same period of time during which the employee is providing the required care. 

Employers may require the employee to use up to two weeks of vacation leave or PTO before receiving benefits; however, employers are not permitted to require the use of paid sick leave. No more than eight weeks of PFL benefits may be paid within any 12-month period. PFL benefits are subject to federal income tax but not to California income tax. 

PFL has no time-in-job requirement for eligibility. In addition, PFL provides no job protection. It is a wage-replacement-only program to care for a family member or to bond with a new child.

See California Extends Paid Family Leave Benefits to 8 Weeks.

Certification for PFL

A medical certification is required when a PFL claim is filed to provide care for a seriously ill family member. The certification must include a diagnosis and International Classification of Diseases code, the beginning date of the disability, the probable duration, and the estimated time that care will be needed. The certification must also state that the serious health condition warrants the participation of the employee to provide care, including offering psychological comfort and arranging third-party care.

A separate certification must be completed for leave associated with the birth, adoption or foster care placement of a child.

The certification process may be completed online or by mail and requires completion by the employee, physician and employer.

The employee is responsible for obtaining a physician/practitioner certification for his or her disability. The claim will be returned if the physician/practitioner certification is not received within 30 days. The employee must provide the receipt number to his or her physician/practitioner after the employee has filed the claim. Although the employer will be notified that an employee has submitted a DI or PFL claim, the employee's detailed claim information is confidential and will not be shared with the employer. See Options to File for Paid Family Leave Benefits.

Employer PFL notice requirements

Employers must provide the Paid Family Leave (DE 2511) brochure to new employees and employees who request leave to care for a seriously ill family member or to bond with a new child. Employers are not required to provide the PFL insurance claim forms to their employees. See Paid Family Leave Forms and Publications.

State Disability Insurance (DI)

The California EDD administers the state DI program, which provides partial wage replacement for employees unable to work due to the employee's own nonwork-related sickness or injury for up to 52 weeks. This program is funded by employee contributions in the form of a state tax through payroll deductions. There are no employer contributions for the state plan; however, the law permits employers to establish a private short-term disability plan, either insured or self-insured, that is equal to or better than the state plan. The employer must receive EDD's approval of the plan, and the majority of employees must agree to the voluntary plan as opposed to the state disability plan.

 See Voluntary Plans.

Although there are a few differences in voluntary versus state plans, for ease of understanding, the information provided below is based on a state disability plan.

Employer Coverage and Employee Eligibility

An employer is an entity with one or more employees in the current or preceding calendar year that has paid wages exceeding $100 in any calendar quarter. According to the EDD, an employee is eligible if the following criteria are met:

• The individual must be unable to do his or her regular or customary work for at least eight consecutive days.
• The individual must be employed or actively looking for work at the time he or she becomes disabled.
• The individual must have lost wages because of the disability or, if unemployed, have been actively looking for work.
• The individual must have earned at least $300 from which SDI deductions were withheld during a previous period.
• The individual must be under the care and treatment of a licensed doctor or accredited religious practitioner during the first eight days of his or her disability. (The beginning date of a claim may be adjusted to meet this requirement.) The individual must remain under care and treatment to continue receiving benefits.
• The individual must complete and mail a claim form within 49 days of the date he or she becomes disabled or risk losing benefits.

The individual's doctor must complete the medical certification of the disability. A licensed midwife, nurse-midwife or nurse practitioner may complete the medical certification for disabilities related to normal pregnancy or childbirth.

A spouse, registered domestic partner, parent or child who provides care for a DI claimant may also be eligible to receive PFL benefits.

Eligible employees must be covered under a state DI or voluntary plan. Employees are eligible at the time of hire if they meet the above requirement regardless of hours worked or employment classification.

Length and Amount of Benefit

Generally, employees may obtain up to 52 weeks of full DI benefits, or the amount of wages in the base period, whichever is less. The base period covers four quarters, basically the wages an individual earned in the previous five months to 18 months before the DI claim. Employees receive about 55 percent of the highest quarter earnings of the base period up to the maximum benefit amount. There is a seven-day wait period before benefits are payable. 

See Calculating Disability Insurance Benefit Payment Amounts.

Interaction with Other Laws

Below are the ways in which California DI relates to other laws:

• PDL. Employees may receive DI concurrently with PDL.
• CFRA. Employees may receive DI concurrently with leave taken for their own serious health condition under the CFRA.
• FMLA. Employees may receive DI concurrently with leave taken for their own serious health condition under the FMLA.
• Workers' compensation insurance. Generally, employees may not receive wage replacement from both workers' compensation and DI.

Interaction with Employer-Paid Vacation and Sick Leave Policies

Employers can require employees to use paid leave during the seven-day waiting period. 

Vacation is not considered wages for DI benefits. Therefore, employers can require or allow employees to use vacation while receiving DI benefits. However, both the FMLA and the CFRA prohibit employers from requiring employees to substitute paid leave if the employee is receiving wage replacement benefits under DI or workers' compensation, except during the wait period or to supplement the difference in full wages versus partial wage replacement. Employers or employees may require the use of paid sick leave during leave for PDL; employers must allow, but may not require the use of, paid vacation or personal leave during PDL leave. 

DI pays only a portion of an employee's regular earnings, approximately 55 percent. Therefore, employers may require or permit employees to supplement DI with PTO or sick time, up to 100 percent of the employee's regular pay as long as the employer has a policy requiring employees to supplement benefits payments and the PTO or sick leave policy permits the use of the paid leave for the purpose for which the employee is taking the leave. See Integration/Coordination of State Disability Insurance (SDI) Benefits.

Employer Posters and Notices

Employers must post EDD Form DE 1857A if covered under both DI and unemployment compensation laws. If the employer is covered only under DI, it should post Form DE 1858.

Employers must also give employees the Disability Insurance Provisions pamphlet, DE 2515, at the time of hire and if an employee becomes disabled due to pregnancy or due to his or her own nonwork-related serious health condition.

Once an employee files a DI claim, the state will send the employer Form DE 2503, which the employer must complete and return to the state within two days of receipt.

See Disability Insurance Forms and Publications.

Other Employer Policies and Practices

Employers can define their own policies and practices regarding medical leaves of absence and PTO; however, those practices must meet the compliance threshold as outlined by various regulations. In addition, an employer may, as a competitive practice, offer more generous programs than the law requires, but nothing in an employer handbook, practice or policy can deny an employee his or her statutory rights.

Vacation and PTO

Many employers voluntarily offer paid vacation and PTO benefits to employees, and employers may permit an employee to use these benefits for medical leave absences. In California, paid vacation and PTO are considered a form of wages that are earned while working.

Employers must pay earned, unused vacation or PTO (or any paid day that can be used for any reason) at the end of employment, whether termination is voluntary or involuntary, unless the vacation or PTO plan is covered under the Employee Retirement Income Security Act (ERISA).

Once earned, vacation or PTO time (or any paid day that can be used for any reason) cannot be forfeited. In other words, use-it-or-lose-it policies are prohibited in California. However, employers can place a reasonable cap on the accrual of vacation. The DLSE will look at several factors to determine if a cap is reasonable:

• The amount of vacation offered.
• Opportunity for employees to use the vacation.
• Business involved.

The DLSE historically opined that a worker must have at least nine months after the vacation accrues before a cap will be deemed effective, and it was recommended that any cap should be 1.75 times the annual accrual rate. In March 2006, the Labor Commission issued a new manual and withdrew its prior opinion letters on the issue. The current enforcement position suggests that the DLSE has adopted a less stringent approach as to what constitutes "reasonable." The DLSE manual currently states that policies that require vacation to be used in the year it is earned "or in a very limited time following the accrual period" will not be enforced. Thus, a cap of 1.5 times the annual vacation accrual may be enforceable. However, an employer providing a cap under 1.75 is exposing itself to legal risk since the law is unclear. Many employers maintain a cap of 1.75 times the annual accrual rate to minimize risk.

Employers do have latitude in policy development regarding the amount of paid vacation provided, when employees begin earning vacation and when employees may take vacation. 

See Vacation FAQs.

Employers are encouraged to have clearly written vacation and PTO policies that have been reviewed by legal counsel to ensure compliance with the laws and rulings.