California Parental Leave Bill Sent to Governor's Desk

Bill would require businesses with 20-49 employees to provide unpaid, job-protected baby-bonding leave

Lisa Nagele-Piazza, J.D., SHRM-SCP By Lisa Nagele-Piazza, J.D., SHRM-SCP September 20, 2017
California Parental Leave Bill Sent to Governors Desk

A California bill that would expand the state's parental leave law is on its way to Gov. Jerry Brown's desk—but it's not clear whether he will approve the legislation.

"He might veto the bill," said Christopher Olmsted, an attorney with Ogletree Deakins in San Diego. "Gov. Brown vetoed a similar bill, S.B. 654, in 2016, and that bill provided just six weeks of parental leave," he said.

The 2017 bill, S.B. 63, would require businesses with 20-49 employees to provide 12 weeks of job-protected parental leave to eligible workers following a child's birth, adoption or foster care placement. Currently, California's parental leave law applies to businesses with 50 or more employees.

[SHRM members-only HR Q&A: How does California Family Rights Act (CFRA) leave differ from FMLA leave?]

S.B. 63 was introduced by Sen. Hannah-Beth Jackson, D-Santa Barbara, and is largely supported by Democrats. "Any new parent knows that the birth of a new baby comes with a host of changes and challenges. But losing a job should never be among those challenges," Jackson said in a press statement.

Sen. Jeff Stone, R-Temecula, opposes the bill. He said Republican lawmakers support parental leave for larger businesses but that this bill could cause small businesses to struggle and possibly leave the state.

When Brown, who is a Democrat, vetoed the 2016 bill, his letter to the Senate explaining his reasons mentioned the impact that the leave requirement might have on small businesses, Olmsted said.

Susan Groff, an attorney with Jackson Lewis in Los Angeles, noted that it's possible Brown could find that certain amendments to S.B. 63 adequately address his concerns.

Mediation Pilot Program

The bill would make it unlawful for employers to deny leave to eligible workers or to fire or take other adverse employment action against workers who exercise their rights under the proposed law. Thus, small businesses would face litigation risks under the proposed law.

One of the more significant amendments since S.B. 63 was introduced was the proposal of a mediation pilot program for parental leave-related claims, Groff explained. Until Jan. 1, 2020, the bill would require the California Department of Fair Employment and Housing, upon receiving funding from the legislature, to create a parental leave mediation pilot program.

Under the pilot program, within 60 days of receipt of a right-to-sue notice, an employer may request all parties participate in the department's Mediation Division Program. If the employer makes such a request, an employee would be prohibited from pursuing any civil action under the law until the mediation is complete, Groff said.

"Arguably, the governor may find that the proposed mediation program addresses concerns related to costly litigation for small employers," she noted. "In fact, last year the governor suggested [that] a similar mediation proposal should have been considered to help protect small employers."

She added that Democrats have a supermajority in the state's legislature. "Of interest is whether the Democrats may override the veto, should the governor veto the bill again," she said.

Olmsted noted that the mediation program will be implemented only if the legislature provides funding.

Key Provisions

If S.B. 63 is enacted, affected employers would have to offer up to 12 weeks of parental leave to eligible employees beginning Jan. 1, 2018, Olmsted explained. Eligible employees are those who have been employed with the company for at least 12 months, worked at least 1,250 hours during the previous 12-month period, and work at a job site with at least 20 employees within 75 miles of that site.

"If both parents work at the same company and they are otherwise eligible for leave, the company may require them to share the 12-week allotment between them," Olmsted added.

Mothers and fathers would be able to take the unpaid, job-protected leave within the first 12 months after a child's birth, adoption or foster care placement.

HR's Role

Small businesses will need to be aware of the costs associated with S.B. 63 if it is enacted, Groff said. "While the leave may be unpaid, there are other attendant costs."

As an example, she said, S.B. 63 would require employers to maintain employee medical benefits during the leave period. Employers must also determine how to cover job duties while employees are on leave, and such coverage may be especially challenging for small employers. 

"If an employer asks other employees to work overtime to cover the job duties of employees on leave, then with the ever-increasing state and local minimum-wage rates, overtime comes with added expense," she added.

Olmsted noted that if the bill becomes law, affected employers should update their employee handbooks to include the parental leave policy.


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