SB 616 in practice: 40 hours, and the traps in the fine print

Most employers got the headline of SB 616 right and the edges wrong, which is the normal outcome when a familiar entitlement changes size rather than shape. The number went from 24 hours to 40. Almost everything that causes trouble was already there and simply became more valuable.

The mechanics first, because they are worth stating exactly. Employees accrue at least one hour of paid sick leave for every 30 hours worked. Usage can be capped at 40 hours or five days per year, whichever is greater for that employee. Accrual can be capped at 80 hours or ten days. An employer may instead front-load the full 40 hours at the start of the year and skip accrual tracking entirely. An employee must have worked 30 days for you within a year to be covered, and may be required to complete 90 days of employment before using any of it.

Front-loading is the option most small employers should take, and the reason is not generosity. Accrual has to be tracked, shown on the wage statement, and carried over correctly; front-loading replaces all of that with a single number at the start of the year. The trade is that you cannot claw back what goes unused, and for a business with low turnover that is usually cheaper than the administration it removes.

Accrue and carry over, or front-load and forget it. What you may not do is front-load and also enforce an accrual cap.

Now the parts that generate claims. You may not require an employee to find their own replacement as a condition of taking sick leave — the cover shift is the employer's problem, not the sick person's, and asking is itself a violation regardless of whether they were ultimately paid. You may not require a doctor's note as a condition of using accrued sick leave for a qualifying purpose. And you may not count sick leave against an attendance policy, which is the one that catches good employers: a points-based system that treats a lawful sick day as an occurrence is retaliation wearing the clothes of a neutral rule.

Carryover is the second trap. Unused accrued sick leave carries over to the next year — it is not vacation and there is no lawful "use it or lose it". What you may cap is the balance (80 hours) and the annual usage (40 hours), which together let a policy stay bounded without ever expiring anything. Getting this wrong tends to produce a year-end email telling everybody their sick balance resets in January, which is both unlawful and, unhelpfully, in writing.

The third is that state law is a floor. Several California cities run their own ordinances with larger entitlements, different accrual caps, or broader definitions of family member, and where they conflict the employee gets whichever provision is more generous — not whichever came first, and not whichever is in your handbook. A business with worksites in two cities can genuinely owe two different policies.

Sick leave does not expire, is not conditional on finding cover, and cannot be counted as an absence. Those three cause most of the claims.

One more that is easy to miss: unused sick leave is not paid out at separation the way vacation is, because it is not a vested wage. But if you fold sick days into a single PTO bank, you have converted them into vacation — and then all of it is a vested wage, all of it is payable at termination, and none of it can be forfeited. Combining the two banks is a legitimate choice with a real cost attached, and it should be made on purpose rather than because one bank was simpler to administer.

The audit here is a policy read rather than a records pull. Take your handbook and check five sentences: the annual amount, the carryover language, whether a doctor's note is required, whether replacement cover is mentioned, and whether sick days appear anywhere in the attendance policy. Then check the city ordinance for every worksite. Most of what goes wrong is written down already, which is the good news — it means it can be fixed in an afternoon rather than reconstructed from three years of timesheets.