California's Paid Family Leave Program expands the definition of a family member and brings new leave challenges for employers

June 26, 2014

Employment Law Alert

Author(s): Marjorie S. Fochtman, Dale A. Hudson

On the tenth anniversary of California’s Paid Family Leave (“PFL”) insurance program, the program has been amended to expand the categories of family members for whom workers may take time off to provide care. Since 2004, the PFL program has provided up to six weeks of partial income replacement for employees who take time off work to care for a seriously ill child, spouse, parent or registered domestic partner, or to bond with a new child. On July 1, 2014, the program will expand to provide paid leave benefits for workers to care for parents-in-law, grandchildren, grandparents and siblings.

The PFL insurance program is different from other family leave laws because it does not actually require that employers grant an employee a leave of absence or reinstate the employee at the conclusion of leave. Because the PFL program is funded by employees through mandatory payroll deductions, it does not impose a direct financial impact on employers. The law does require that employers post a notice and provide employees with a brochure.

A few limitations exist on an employee’s ability to use the leave. PFL benefits do not begin until after the employee has satisfied a seven-day waiting period. In addition, the employer may require the employee to use up to two weeks’ vacation leave or paid time off (PTO) prior to receiving benefits. The first week of vacation or PTO is applied to the waiting period. An individual is not eligible for PFL benefits for any day that another family member is able and available for the ill family member.

As stated previously, PFL benefits do not provide job protection or return rights. However, if an employee’s request for leave is protected by the federal Family and Medical Leave Act (FMLA) or the California Family Rights Act (CFRA), the employee may be entitled to job protection rights under either or both of those statutes. An individual who is entitled to leave under FMLA and/or CFRA must take PFL concurrent with leave taken under those acts. Prior to the recent amendment, if the employee and the employer were covered by FMLA or CFRA, a leave eligible for PFL was also likely protected by FMLA/CFRA. Accordingly, the employee would have the right to protected leave, and the employer would have the right to obtain certification of the need for leave from the family member’s health care provider. However, the expansion of PFL benefits for the care of grandparents, grandchildren and siblings will create new headaches for employers. For example, employees may be confused by the “Paid Family Leave” terminology and assume that they are receiving protected leave. In addition, if an employer wishes to obtain certification to document the need for leave, it will need to create new documentation for that purpose.

While the PFL statute does not provide job protection, employers should be cautious about terminating an employee who requests time off to provide caregiver services. Family Responsibility Discrimination (“FRD”) is a theory of discrimination gaining recognition, but is not yet codified in federal or California law. FRD may arise when an employer discriminates against an employee because of family care responsibilities. Most often directed at new mothers, increasingly it may arise when an employer treats an employee less favorably than other employees based on a perception that the employee will be less committed because of the employee’s caregiving responsibilities.

Another possible risk is a claim of associational discrimination. Both the federal Americans with Disabilities Act (ADA) and California’s Fair Employment and Housing Act (FEHA) prohibit an employer from discriminating against an employee because that employee is associated with a person who has, or is perceived to have, a disability. In a recent California case, Rope v. Auto-Chlor System of Washington, Inc., 220 Cal. App. 4th 635 (2013), a California court of appeal found that associational disability discrimination may have occurred where an employer terminated an employee to avoid the expense of providing the employee with paid leave while the employee donated a kidney to his disabled sister. The boundaries of prohibited associational discrimination are not yet clearly defined, but it would not be surprising if employees argue that associational discrimination has occurred in those instances where an employee is terminated for taking leave that was eligible for PFL, but not protected by FMLA or CFRA.

In addition, San Francisco recently passed the Family Friendly Workplace Ordinance, which provides employees the right to ask for flexible or predictable working arrangements for their family caregiving responsibilities. The Ordinance also prohibits an employer from discharging, threatening to discharge, demoting, suspending or otherwise taking adverse employment action against any person on the basis of caregiver status.

Clearly, family responsibilities are affecting and will increasingly affect the workplace. Further legislation protecting employees with caregiver responsibilities is likely. It is probably only a matter of time before the California Family Rights Act is expanded to include the expanded family relationships covered by PFL. A measure introduced in 2012, Assembly Bill 2039, would have broadened the California law to cover those categories, but it did not pass. The experience with the expanded family coverage in PFL will likely spur efforts to expand CFRA to include job protection and reinstatement rights for employees who care for this expanded list of family members.

What Should Employers Do Now?

  • Consider whether to expand your family leave policy to cover these new forms of caregiver leave.
  • Create new leave request forms for employees who request leave to care for parents-in-law, grandchildren, grandparents and siblings, and consider requiring certification from the relative’s health care provider to document the need for leave.
  • If granting personal leave for the new categories of caregivers, decide if you will continue health insurance during the leave.
  • If you do not grant leave for these new categories of caregivers, revise your existing leave policies to make this explicit.
  • Check to see if your current policies prohibit all forms of associational discrimination or retaliation, and revise them if they do not.
  • Educate and train managers about how to respond to employee requests for time off or schedule changes due to family caregiving responsibilities.
  • Post the updated Paid Family Leave notice.
  • Provide the updated brochures about PFL benefits to new employees, and to employees leaving work to care for a seriously ill family member or to bond with a new child.

The foregoing has been prepared for the general information of clients and friends of the firm. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel. If you have any questions or require any further information regarding these or other related matters, please contact your regular Nixon Peabody LLP representative. This material may be considered advertising under certain rules of professional conduct.

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