California paid family leave: {beginning July 1, employees are allowed six weeks off—with partial pay—to care for a newborn or other family member. Here's how employees & employers can prepare}

California CPA, May, 2004 by David A. Wimmer, Jeffrey W. Mayes

WHAT EMPLOYERS NEED TO DO

Employers must obtain from the EDD the necessary notices and publications to provide their employees. The easiest way to do this is through the EDD's website at www.edd.ca.gov.

All employers first should obtain copies of DE 2511, a two-page brochure that provides an overview of the Paid Family Leave program. This brochure must be provided to all new employees hired on or after Jan. 1, 2004, and all employees taking leave to care for an ill family member or bond with a child after July 1, 2004.

Employers also should obtain the workplace posting notice--either DE 1858 or DE 1857A. DE 1858 should be used by employers covered only by SDI; DE 1857A should be used by employers covered by both SDI and Unemployment Insurance. If employers do not know if they also are covered by Unemployment Insurance, they should contact their payroll company or employment law counsel. Employers should post the DE 1858 or DE 1857A notice with their other employee postings.

Employers can require employees taking paid family leave to use a maximum of two weeks of accrued, unused vacation time prior to being eligible for paid family leave benefits. Where paid family leave is taken concurrently with a FMLA/CFRA leave, the employer may require employees to exhaust their accrued, unused vacation.

Employers who desire to require employees to use vacation on their paid family leave should amend their vacation policy to detail how much vacation, up to the two weeks maximum, employees must take prior to receiving paid family leave benefits.

For example, if an employer requires employees to use the maximum of two weeks vacation, the first week employees use vacation will count as the employee's waiting period. The second week employees receive vacation pay they will not receive any paid family leave wage replacement. In the third week, absent any administrative delay by the state, employees will begin receiving their paid family leave partial wage replacement benefits, which will continue for five more weeks.

Consequently, if Bob's employer requires him to take one week of vacation prior to receiving paid family leave benefits, Bob will begin receiving those benefits in his second week of leave. Assuming he requires leave for eight weeks, Bob will receive a partial wage for all six weeks following the week his employer required him to take vacation, leaving one week without vacation pay or wage replacement.

EFFECT OF OTHER LEAVE ACTS

If an employer has 50 or more employees, the Federal Family and Medical Leave Act and California Family Rights Act provide a leave of up to 12 weeks per year for reasons similar to paid family leave. Although sharing some eligibility requirements, there are important differences between the various acts.

* FMLA/CFRA are in effect. Thus, employees eligible for FMLA/CFRA may take those leaves. Employees must wait until July 1, 2004 before taking paid family leave because the partial wage replacement does not begin until July 1. If Bob needed to take his leave on Jan. 1, 2004, as opposed to Aug. 1, 2004, he could only obtain a FMLA/CFRA leave--not paid family leave.