Potential Expansion of Leave Law Would Hurt Businesses Facing Slashed Profits, Income Amid COVID-19

Monday, July 27, 2020

(Northern California Record)

A new bill that would make small businesses subject to the same family leave law as large companies would adversely impact the California business community at a time it is already struggling under the COVID-19 economic decline and new shut down orders, a trade group coalition says.

SB 1383, which passed the Senate earlier this month, would require businesses with five or more workers to provide up to 12 weeks of unpaid family leave; the current law applies to businesses with 50 or more employees.

“It’s happening when businesses can least afford it and presents a particular burden to small businesses by lowering the threshold from 50 to five," Jennifer Barrera, CalChamber executive vice president, told the Northern California Record. “There’s no question we’re in an economic crisis due to the coronavirus, and the governor on Monday shutting down businesses again adds to their very precarious position. This bill is one more obstacle to their ability to maintain their operations.”

A letter from the chamber, signed by 100 supporting groups, cites the most recent labor market data from the state’s Employment Development Department (EDD), which says California has roughly 1.6 million employers, and 1.1 million of them have fewer than five employees.

SB 1383 also provides for recourse through civil litigation.

“Any misstep invites a private right of action,” Barrera said. “Our perspective is we should be looking at ways to help businesses. I would suggest that this is that time that they cannot handle any more burdens on them.”

More family members also would qualify under SB 1383.

“The employee could take leave under SB 1383 for three months to care for a domestic partner, child of a domestic partner, grandparent, grandchild, or sibling, return to work, and then take another three months off under [federal] FMLA for the employee’s own medical condition or the medical condition of a spouse, child or parent or for the birth, adoption or foster care placement of a child,” the coalition’s letter states.

AB 5 restrictions also would prevent many kinds of temporary hiring, Barrera said.

“When you add in all these family members that are not part of the federal leave law, it becomes a stacking issue, basically six months off of work,” Barrera said. “At large employers, that’s maybe okay, but at the same time, hotels and airlines are seeing a record number of layoffs and financially struggling; this adds another layer of burden onto them.”

The state’s family leave program through EDD already presents an alternative to SB 1383, which is sponsored by Sen. Hannah-Beth Jackson, D-Santa Barbara.

“It isn’t mandatory, but you see employers offering it voluntarily without the threat of litigation,” Barrera said. “So saying they wouldn’t give leave without a law is not supported by the data that’s out there.”

Additionally, the CARES (Coronavirus Aid, Relief, and Economic Security) Act has expanded family leave provisions, Barrera said.

“You can’t just look at SB 1383 in isolation, but in the general landscape of all the leave laws that are already out there and how it adds more burden onto those employers already suffering as a result of this pandemic,” Barrera said.

Category: COVID-19