Seyfarth Synopsis: In 2021, West Hollywood joined the rising ranks of California cities with their very own native sick go away and/or minimal wage necessities. West Hollywood enacted an ordinance that created paid and unpaid break day mandates in addition to minimal wage obligations and mandates for the distribution of service fees, which went into impact for many employers on July 1, 2022. In Might 2023, the Metropolis revealed amended rules that made just a few impactful adjustments to the Ordinance, together with setting a selected threshold of compensated go away that may very well be designated for paid sick go away functions solely, adjusting accrual charges for compensated go away, and altering the ready time interval to be used of go away.
On November 15, 2021, West Hollywood enacted an Ordinance that allows workers to accrue as much as 96 hours of compensated go away per yr for sick go away, trip, or private necessity, and as much as 80 hours of uncompensated go away which can be utilized for worker or member of the family sick go away after compensated go away is totally exhausted. The Ordinance additionally set a schedule for rising the Metropolis’s minimal wage. On Might 16, 2022, West Hollywood amended the Ordinance to make clear a few of its extra complicated provisions. Most not too long ago, in Might 2023, the Metropolis amended the rules on this Ordinance.
West Hollywood additionally publishes administrative supplies, corresponding to required posters relating to the minimal wage and the break day provisions.
Learn how to Get 4 Stars for Compliance
Employers want to ensure they keep on script with the important thing parts of the Ordinance:
- Completely different Efficient Dates for Resort Versus Normal Employers: For resort employers, the Ordinance took impact on January 1, 2022. For all different employers, the Ordinance took impact on July 1, 2022.
- Two Hours of Work Creates a West Hollywood “Worker”: “Worker” contains any one who performs a minimum of two hours of labor throughout the geographic boundaries of West Hollywood for an employer in a selected week, and is entitled to minimal wage (i.e. is nonexempt).
- Broad Definitions of Employers and Resort Employers: Employers are outlined broadly. “Resort employers” broadly encompasses inns, in addition to entities that personal or management leased or sublet premises linked to the resort (for instance, a spa or restaurant).
West Hollywood Takes PTO to the Massive Time
The Metropolis’s compensated break day (“PTO”) provisions allow workers to accrue compensated break day that can be utilized for sick go away, trip, or private necessity.
- As much as 96 Hours of Compensated Time Off: Full-time workers are in a position to accrue as much as 96 hours of compensated break day per yr. Half-time workers should obtain a pro-rated quantity. Employers should not “unreasonably deny” an worker’s request to make use of accrued go away.
- Employers Can Separate Paid Sick and Trip/Private Time: The rules clarify that employers can separate the 96 hours of compensated go away into separate buckets for sick time and trip/private time. Nonetheless, a minimum of 50% of the compensated time (48 hours) should be accessible to be used for trip or private necessity. Any paid sick go away part should adjust to each the California State paid sick go away regulation (which was amended efficient January 1, 2024, by SB 616) and West Hollywood requirements. Any private necessity or trip time should be handled as trip time underneath California regulation (which means no “use it or lose it” and accrued, unused time should be paid out upon termination).
- PTO Allotment and Accrual: The Might 2023 rules present that each one workers, together with part-time and momentary workers, who work a minimum of 30 days inside a yr for a similar employer, should obtain a minimum of 24 hours of compensated go away that can be utilized for sick go away functions starting on the ninetieth calendar day of employment. The 24-hour allotment of sick go away is a part of workers’ complete allotment of compensated break day per yr. Full-time workers are nonetheless in a position to accrue as much as 96 hours, inclusive of the 24-hour sick go away allotment, and part-time workers shall accrue a professional rata period of time.
- Accrual Charge for Paid Sick Go away in Extra of 24 Hours: The Might 2023 rules seem to require that the primary 24 hours of compensated go away categorized as paid sick go away accrue at an accelerated charge of .046 hours of sick go away per hour labored. As soon as an worker has accrued 24-hours of paid sick go away, any further paid sick go away can accrue at a charge of a minimum of 0.033 hours of sick go away per hour labored (i.e. 1 hour of paid sick go away for each 30 hours labored). As compared, the prior rules set an accrual charge of 0.047 hours per hour labored for the complete financial institution of compensated go away, as much as 96 hours per yr, and an accrual charge of 0.039 hours for workers’ financial institution of uncompensated go away as much as 80 hours per yr. The brand new rules usually present that compensated and uncompensated go away can accrue at a charge that ensures full time workers obtain 96 hours of compensated go away and 80 hours of uncompensated go away by the top of the 12 month interval (which might be prorated for part-time workers).
- Carryover: Unused, accrued compensated break day should be allowed to hold over till the break day reaches a most stability of 192 hours, except the employer’s established coverage is extra beneficiant. The utmost stability for uncompensated break day is 80 hours, which carries over from yr to yr.
- Money-Out Not Required: The unique Ordinance required coated employers to offer a money cost to workers for any accrued compensated time above 192 hours each 30 days. Nonetheless, the amended model deletes the 30-day cash-out provision.
- Charge of PTO Pay: In contrast to California’s state-wide PSL, the speed of pay for compensated break day relies solely upon the bottom charge of pay. Employers who search to have West Hollywood paid sick go away or any payout of PTO at termination adjust to state necessities might want to tread rigorously.
- Uncompensated Time Off: Employers should additionally allow full-time workers to take a minimum of eighty (80) further hours per yr of uncompensated break day for use for sick go away functions the place the worker has exhausted their compensated break day for that yr. Full-time workers ought to accrue 80/52 hours of uncompensated break day per week, or obtain a frontload of time as much as the 80 hour most. Half-time workers obtain a proportional quantity. Unused, accrued uncompensated break day will carry over till the break day reaches a most of 80 hours, except the employer’s established coverage is extra beneficiant. Uncompensated break day doesn’t accrue in extra of 40 hours in a given week.
- Credit score The place Credit score Is Due. Although the ordinance shouldn’t be crystal clear on this level, the rules counsel that solely the hours labored throughout the Metropolis rely in the direction of accrual.
- 90-Day Ready Interval. In line with the Might 2023 rules, workers are eligible to make use of uncompensated go away and any accrued compensated go away after the primary 90 days of employment, or per firm insurance policies, whichever is sooner. The prior iteration of the rules had a a lot lengthier six-month ready interval for uncompensated break day (though uncompensated break day can’t be used till the worker has exhausted compensated break day).
- No Illegal Practices or Retaliation: As with comparable ordinances, employers are prohibited from lowering hours or advantages with a purpose to pay wages lower than the established minimal wage, and they’re prohibited from retaliating in opposition to workers for exercising their rights underneath the Ordinance.
- Legal responsibility for Civil Penalties and Lawsuits: The Ordinance supplies for administrative penalties and creates a non-public proper of motion for aggrieved workers.
- Rehire Obligations: Like common California paid sick go away, if an worker is rehired inside a yr, the beforehand accrued and unused compensated go away (designated as sick go away) and uncompensated sick go away should be reinstated.
Minimal Wage Necessities
Along with the paid break day parts as described above, West Hollywood’s Ordinance incorporates a minimal wage part, elevating the minimal wage above the degrees set by the state and different native areas. Beginning July 1, 2023, the citywide minimal wage for all companies turned $19.08. This charge will stay in impact till June 30, 2024, and can then enhance based mostly on the Client Worth Index.
The Metropolis will announce the adjusted charges yearly on or earlier than every April 1st and publish a bulletin saying the adjusted charges, which can even take impact on July 1st of every yr.
- Discover and Posting: Each employer shall put up the Metropolis’s poster in a conspicuous place at any office or job web site the place coated workers work. Notices shall be posted in English, Spanish, and some other language spoken by a minimum of 5 p.c (5%) of coated workers. At hiring, employers are additionally required to offer discover of the employer’s identify, deal with, and phone quantity in writing. Employers must also inform their workers of the doable proper to the earned earnings tax credit score underneath state and federal regulation.
- Report Retention: Much like state necessities, employers must retain payroll information pertaining for a minimum of three years.
Service Cost Necessities within the Limelight
Employers are required to distribute Service Prices to workers who carried out companies (excluding managers and supervisors). The Ordinance defines a Service Cost as one thing that’s not a gratuity, however is a separately-designated quantity charged and picked up from clients for service, or is described in such a approach that clients may moderately consider that the quantity is for these companies or is in any other case to be paid or payable on to workers, together with these fees designated on receipts, invoices, or billing statements underneath the time period “service cost,” “desk cost,” “porterage cost,” “automated gratuity cost,” “healthcare surcharge,” “advantages surcharge,” or comparable language.
Can We Exit Stage Left?
The ordinance supplies an avenue for companies that will expertise hardship to hunt a waiver, which requires particular discover provisions to workers. The provisions within the Ordinance will also be waived by way of a collective bargaining settlement, however solely the place the waiver is about forth in clear and unambiguous phrases.
Office Options
Because the paid go away panorama continues to broaden, firms ought to attain out to their favourite Seyfarth legal professional for options. To remain up-to-date on paid go away developments in California and past, click on right here to join Seyfarth’s Paid Sick Go away mailing record.
Edited by Coby Turner