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AB-1179 Employer provided benefit: backup childcare.(2021-2022)

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Date Published: 02/18/2021 09:00 PM
AB1179:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 1179

Introduced by Assembly Member Carrillo

February 18, 2021

An act to add Article 6 (commencing with Section 2950) to Chapter 2 of Division 3 of the Labor Code, relating to employment.


LEGISLATIVE COUNSEL'S DIGEST


AB 1179, as introduced, Carrillo. Employer provided benefit: backup childcare.
Existing law, the Healthy Workplaces, Healthy Families Act of 2014, requires employers to provide an employee, who works in California for 30 or more days within a year from the commencement of employment, with paid sick days for prescribed purposes, to be accrued at a rate of no less than one hour for every 30 hours worked. Existing law authorizes an employer to limit an employee’s use of paid sick days to 24 hours or 3 days in each year of employment.
This bill would require an employer to provide an employee, on or after January 1, 2022, who works in California for the same employer for 30 or more days within a year from the commencement of employment, with up to 60 hours of paid backup childcare benefits, to be accrued and used as provided. The bill would define “backup childcare” as childcare provided by a qualified backup childcare provider to the employee’s child when the employee’s regular childcare provider cannot be utilized, and “paid backup childcare” as an employee benefit consisting of the employer paying for a qualified backup childcare provider to provide backup childcare for an employee’s child that is compensated at the state minimum wage or the federal minimum wage, whichever is higher.
This bill would apply to employers with 1,000 or more employees, the state, political subdivisions of the state, and municipalities, including charter cities. The bill would require employers to keep records for at least 3 years documenting the hours worked and paid backup childcare benefits used by the employee and to allow the Labor Commissioner to access those records. The bill would provide that if an employer does not maintain adequate records, the employee is presumed to have accrued the maximum number of benefit hours accruable, unless the employer can prove otherwise by clear and convincing evidence.
The bill would include findings that changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares all of the following:
(a) Parents with children under 14 years of age make up almost one-third of the country’s workforce, or roughly 50 million workers.
(b) Prior to the pandemic, the average working parent missed eight days a year due to childcare issues. The increased loss of childcare during the pandemic has forced over 2 million women out of the workforce. Economic recovery through decreased unemployment rates will rely on their continued participation or reentry into the labor force.
(c) Inadequate backup childcare is one of the top reasons women drop out of the workforce.
(1) Approximately one-third of highly educated women drop out of the workforce every year and 74 percent of those women say the lack of decent childcare was the primary reason.
(2) For low-wage workers, parents may be forced to choose between losing a job and setting up suboptimal care. This could lead to unnecessary encounters with child protective services.
(3) Single mothers of young children who received a company subsidy for childcare have been found to be 40 percent more likely to still be employed after two years.
(4) The ability to stay in the workforce, along with paying less out-of-pocket for childcare, could increase family economic stability and, in turn, could increase child well-being.
(d) At this time, only 7 percent of companies offer any backup childcare as a net benefit. Currently, parents and the government overwhelmingly pay for childcare costs, while corporations and philanthropies provide a scant 1 percent contribution to this overwhelming burden.
(e) In a review of companies that currently offer backup childcare, it was found that the annual usage rate amongst all employees was less than 4 percent. For a company with 1,000 employees, a 4 percent usage rate would cost an average of twenty-eight dollars and eighty cents ($28.80) per employee, per year. Assuming the usage rate doubles once backup care becomes a standard benefit, the cost is likely to remain less than fifty dollars ($50) per employee, per year.
(f) Supporting access to childcare could save employers money on lost revenue associated with attrition due to childcare obstacles, as well as the costs to train and hire new employees, which is generally approximately 20 percent of an employee’s salary.
(g) Thus, in order to support working families and protect children, the Legislature intends to require certain employers to make backup childcare available to their employees as an employment benefit.

SEC. 2.

 Article 6 (commencing with Section 2950) is added to Chapter 2 of Division 3 of the Labor Code, to read:
Article  6. Backup Childcare Benefit

2950.
 (a) An employer in this state shall provide paid backup childcare as a direct benefit to their eligible employees pursuant to this article.
(b) An employer may provide the backup childcare benefit as follows:
(1) By contracting with a licensed childcare provider and providing direct payments to the licensed provider for the hours used by the employee.
(2) Directly paying a qualified backup childcare provider upon receipt of an invoice detailing the number of hours used by the employee.
(3) By reimbursing an employee for up to 60 hours for backup childcare paid by the employee.

2951.
 As used in this article the following terms have the following meanings:
(a) “Backup childcare” means childcare provided by a qualified backup childcare provider to the employee’s child when the employee’s regular childcare provider cannot be utilized.
(b) “Employee” does not include the following:
(1) An employee covered by a valid collective bargaining agreement if the agreement expressly provides for the wages, hours of work, and working conditions of employees, and expressly provides for the payments to support backup childcare and expressly provides for final and binding arbitration of disputes concerning the application of its paid backup childcare provisions.
(2) An employee in the construction industry covered by a valid collective bargaining agreement if the agreement expressly provides for the wages, hours of work, and working conditions of employees, premium wage rates for all overtime hours worked, and regular hourly pay of not less than 30 percent more than the state minimum wage rate, and the agreement either (A) was entered into before January 1, 2021, or (B) expressly waives the requirements of this article in clear and unambiguous terms. For purposes of this subparagraph, “employee in the construction industry” means an employee performing work associated with construction, including work involving alteration, demolition, building, excavation, renovation, remodeling, maintenance, improvement, repair work, and any other work as described by Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code, and other similar or related occupations or trades.
(3) An individual employed by an air carrier as a flight deck or cabin crew member that is subject to the provisions of Title II of the federal Railway Labor Act (45 U.S.C. Sec. 151 et seq.), provided that the individual is provided with paid backup childcare benefits equal to or exceeding the amount established Section 2952.
(4) An employee of the state, city, county, city and county, district, or any other public entity who is a recipient of a retirement allowance and employed without reinstatement into the employee’s respective retirement system pursuant to either Article 8 (commencing with Section 21220) of Chapter 12 of Part 3 of Division 5 of Title 2 of the Government Code, or Article 8 (commencing with Section 31680) of Chapter 3 of Part 3 of Division 4 of Title 3 of the Government Code.
(c) “Employer” means any person employing another under any appointment or contract of hire, and includes private employers with 1,000 or more employees, the state, political subdivisions of the state, and municipalities, including charter cities.
(d) “Family member” means any of the following:
(1) A child, which for purposes of this article means a biological, adopted, or foster child, stepchild, legal ward, or a child to whom the employee stands in loco parentis. This definition of a child is applicable regardless of age or dependency status.
(2) A biological, adoptive, or foster parent, stepparent, or legal guardian of an employee or the employee’s spouse or registered domestic partner, or a person who stood in loco parentis when the employee was a minor child.
(3) A spouse.
(4) A registered domestic partner.
(5) A grandparent.
(6) A grandchild.
(7) A sibling.
(e) “Health care provider” has the same meaning as defined in paragraph (9) of subdivision (b) of Section 12945.2 of the Government Code.
(f) “Paid backup childcare” or “paid backup childcare benefit” means an employee benefit consisting of the employer paying for a qualified backup childcare provider to provide backup childcare for an employee’s child that is compensated at the state minimum wage or the federal minimum wage, whichever is higher.
(g) “Qualified backup childcare providers” means either of the following:
(1) Licensed childcare providers licensed by the State Department of Social Services.
(2) License-exempt childcare providers, as defined in Section 1596.60 of the Health and Safety Code.

2952.
 (a) An employee who, on or after January 1, 2022, works in California for the same employer for 30 or more days within a year from the commencement of employment is entitled to paid backup childcare benefits as specified in this section.
(b) (1) An employee shall accrue the paid backup childcare benefit at the rate of not less than one hour per every 34 hours worked, beginning at the commencement of employment or the operative date of this article, whichever is later.
(2) An employee who is exempt from overtime requirements as an administrative, executive, or professional employee under a wage order of the Industrial Welfare Commission is deemed to work 40 hours per workweek for the purposes of this section, unless the employee’s normal workweek is less than 40 hours, in which case the employee shall accrue backup childcare benefits based upon that normal workweek.
(3) An employer may use a different accrual method, other than providing one hour per every 34 hours worked, provided that the accrual is on a regular basis so that an employee has no less than 60 hours of accrued backup childcare benefits by the 200th calendar day of employment or each calendar year, or in each 12-month period.
(4) An employer may satisfy the accrual requirements of this section by providing not less than 60 hours of backup childcare benefits, which is available to the employee to use by the completion of the employee’s 200th calendar day of employment.
(c) An employee shall be entitled to use accrued paid childcare beginning on the 90th day of employment, after which day the employee may use paid backup childcare benefit hours as they are accrued.
(d) Accrued paid childcare shall carry over to the following year of employment. However, an employer may limit an employee’s use of the accrued paid backup childcare benefits to 60 hours in each year of employment, calendar year, or 12-month period. This section shall be satisfied and no accrual or carryover is required if the full amount of the benefit is received at the beginning of each year of employment, calendar year, or 12-month period. The term “full amount of the benefit” means 60 hours.
(e) An employer is not required to provide additional paid backup childcare benefits pursuant to this section if the employer has a paid childcare policy that makes available an amount of leave applicable to employees that may be used for the same purposes and under the same conditions as specified in this section, and the policy does one of the following:
(1) Satisfies the accrual, carryover, and use requirements of this section.
(2) (A) Provides paid backup childcare benefits to a class of employees before January 1, 2022, pursuant to a policy that used an accrual method different than providing one hour per 34 hours worked, provided that the accrual is on a regular basis so that an employee, including an employee hired into that class after January 1, 2022, has no less than 15 hours of accrued backup childcare within three months of employment of each calendar year.
(B) If an employer modifies the accrual method used in the policy it had in place prior to January 1, 2022, the employer shall comply with any accrual method set forth in subdivision (b) or provide the full amount of the benefit at the beginning of each year of employment, calendar year, or 12-month period. This section does not prohibit the employer from increasing the accrual amount or rate for a class of employees covered by this subdivision.
(f) (1) Except as specified in paragraph (2), an employer is not required to provide compensation to an employee for accrued, unused paid backup childcare benefits upon termination, resignation, retirement, or other separation from employment.
(2) If an employee separates from an employer and is rehired by the employer within one year from the date of separation, previously accrued and unused paid backup childcare benefits shall be reinstated. The employee shall be entitled to use those previously accrued and unused paid backup childcare benefits and to accrue additional paid backup childcare benefits upon rehiring, subject to the use and accrual limitations set forth in this section. An employer is not required to reinstate accrued paid backup childcare benefits to an employee that was paid out at the time of termination, resignation, or separation of employment.
(g) An employer shall provide an employee with written notice that sets forth the amount of paid backup childcare benefits available for use on either the employee’s itemized wage statement or in a separate writing provided on the designated pay date with the employee’s payment of wages. If an employer provides unlimited childcare benefits, the employer may satisfy this section by indicating on the notice or the employee’s itemized wage statement “unlimited.”
(h) An employee may determine the amount of the paid backup childcare benefits they need to use, provided that an employer may set a reasonable minimum increment, not to exceed two hours, for the use of the paid backup childcare benefit.
(i) For the purposes of this section, an employer shall calculate the paid backup childcare benefit using any of the following calculations:
(1) Paid backup childcare benefits for nonexempt employees shall be calculated in the same manner as the regular rate of pay for the workweek in which the employee uses the paid backup childcare benefit, whether or not the employee actually works overtime in that workweek.
(2) Paid backup childcare benefits for nonexempt employees shall be calculated by dividing the employee’s total wages, not including overtime premium pay, by the employee’s total hours worked in the full pay periods of the prior 90 days of employment.
(3) Paid backup childcare benefits for exempt employees shall be calculated in the same manner as the employer calculates wages for other forms of paid leave time.
(j) An employer shall provide payment for backup childcare no later than the payday for the next regular payroll period after the backup childcare was used.

2953.
 (a) An employer shall keep for at least three years records documenting the hours worked and paid backup childcare benefits accrued and used by an employee, and shall allow the Labor Commissioner to access these records. An employer shall make these records available to an employee. If an employer does not maintain adequate records pursuant to this section, it shall be presumed that the employee is entitled to the maximum number of hours accruable under this article, unless the employer can show otherwise by clear and convincing evidence.
(b) Notwithstanding any provision of this article, an employer is not obligated to inquire into or record the purposes for which an employee uses the paid backup childcare benefit. An employer shall not compel an employee to provide documentation verifying use of their first 60 hours.
(c) This section shall preempt any local ordinance to the contrary.

2954.
 (a) This article does not limit or affect any laws guaranteeing the privacy of health information, or information related to domestic violence or sexual assault, regarding an employee or employee’s family member. That information shall be treated as confidential and shall not be disclosed to any person except to the affected employee, or as required by law.
(b) This article shall not be construed to discourage or prohibit an employer from the adoption or retention of a paid backup childcare benefit policy more generous than the one required herein.
(c) This article does not lessen the obligation of an employer to comply with a contract, collective bargaining agreement, employment benefit plan, or other agreement providing more generous paid backup childcare benefits to an employee than required herein.
(d) This article establishes minimum requirements pertaining to the paid backup childcare benefit and does not preempt, limit, or otherwise affect the applicability of any other law, regulation, requirement, policy, or standard that provides for greater accrual or use by employees of the paid backup childcare benefit or that extends other protections to an employee.

2955.
 The Legislature finds and declares that establishing uniform statewide regulation of certain aspects of paid backup childcare benefits is a matter of statewide concern and is not a municipal affair as that term is used in Section 5 of Article XI of the California Constitution. Therefore, this article applies to all cities, including charter cities.