California’s COVID-19 Supplemental Paid Sick Leave Must be Paid to Terminated Employees Says Department of Labor

May 2021

In our recent update, we provided guidance on how to comply with Senate Bill 95 ("SB 95") which created Supplemental Paid Sick Leave (“SPSL”) for California employees for COVID-19 related reasons. In short, SB 95 required employers with over 25 employees to provide up to 80 hours of paid sick leave for qualifying COVID-19 related reasons and mandates payment of SPSL retroactively to January 1, 2021.

We received numerous questions from clients regarding payment of SPSL to employees who were terminated or resigned before the effective date of the law, March 29, 2021. The answer to this question appeared simple, considering the statute defines “covered employee” as an “employee” and not an “employee or former employee.”  Absent language in the statute which would appear to confer an obligation to pay SPSL to former employees and seeing no guidance on this issue in the Department of Industrial Relations FAQ, we reached out to the Labor Commissioner directly.  The Labor Commissioner’s response was this: “Former employees can request retroactive Supplemental Paid Sick leave for 2021 because it was accrued while they were employed. The day(s) they took off was a day(s) on which they should have been paid if it was for a qualifying reason and they timely requested payment.” 

While we find this interpretation to be without support in the text of the statute, and certainly subject to legal challenge in court, in light of this guidance, employers would be prudent to issue SPSL to former employees who request retroactive payment for leave taken for a qualifying reason after January 1, 2021, even if they were terminated or resigned before the effective date of the law.