Workplace Alert: When is the San Diego Minimum Wage and Sick Pay Ordinance Effective?

A number of compliance issues have arisen since the passage of San Diego’s Earned Sick Leave and Minimum Wage Ordinance (the “Ordinance”) on June 7, 2016. The most pressing question is the Ordinance’s effective date. This article addresses that question and provides updates on additional compliance issues, such as whether the Ordinance will allow front loading of paid sick time or accrual caps. Effective Date The Ordinance will not become effective until the San Diego City Council approves a resolution certifying the election results. According to the information provided by the City of San Diego’s website, that approval is expected by the San Diego City Council the week of July 11 or July 18. The Ordinance will become effective immediately upon approval of the resolution. Front Loading of Sick Time and Accrual Caps According to the City, the City Council will also be issuing an implementing ordinance, which will hopefully answer a number of open questions, such as front loading sick time and accrual caps. The Ordinance as drafted does not provide any mechanisms for employers to “front load” (or advance) paid sick time. Instead, the Ordinance requires employees to accrue one hour of paid sick time for every 30 hours worked. According to an FAQ document issued by the City, the City Council’s implementing ordinance may address whether other accrual methods such as front loading of time will satisfy the Ordinance. Additionally, accrual caps for paid time are not presently permitted under the Ordinance. While employers may limit use of accrued sick time to 40 hours per year, employees must be permitted to continue accruing paid sick time and carrying it over from year-to-year. The City’s FAQ document says that the Council will consider whether caps are permissible as part of the implementing ordinance. Employer Action We’ll send another update once the implementing ordinance is issued. The best practice may be to delay any major revisions to paid time off policies until after the City issues the implementing ordinance to see if additional clarification is provided. For additional questions regarding the Ordinance, please contact Lisa Frank or Brenda Kasper.