On February 19, 2023, San Francisco’s Private Sector Military Leave Pay Protection Act took effect. The ordinance requires covered employers to provide supplemental pay to an employee while on leave for military duty for up to 30 days in a calendar year.
San Francisco’s Office of Labor Standards Enforcement has issued Implementation Guidance to assist employers with compliance. The guidance provides answers to frequently asked questions (FAQ) regarding the ordinances, such as which employers are covered by the ordinance, which employees are covered, and how to calculate supplemental pay. The FAQ notes the following important points:
The ordinance covers employers with 100 or more employees worldwide. The ordinance is not limited to employers that have 100 or more employees who live or work in San Francisco. Where the employee count fluctuates above or below 100 over the course of the year, the employer should use the average number of employees per pay period during the preceding calendar year. Moreover, owners who perform work for compensation for the business are also counted for purposes of determining the employee threshold.
Notably, the City and County of San Francisco and all other governmental entities are not covered employers.
Only employees who work within the geographic boundaries of San Francisco and who are members of the reserve corps of the United States Armed Forces, National Guard, or other United States uniformed service organizations are covered by the ordinance. The ordinance does not cover employees who work at San Francisco International Airport or who work within federal enclaves such as the Presidio, Fort Mason, and Golden Gate National Recreation Area.
Calculating Supplemental Compensation
Under the ordinance, for up to 30 calendar days in a calendar year, a covered employer must pay a covered employee supplemental compensation, which is the difference between the employee’s gross military pay and the amount of gross pay the employee would have received from the employer had the employee worked their regular work schedule. The employee should not receive more compensation than they would have received had they worked their regular work schedule.
“Gross military pay” includes the basic pay rate which can be assessed for the federal Armed Forces at www.dfas.mil. That website lists the current basic pay rates according to the employee’s rank. Gross military pay does not include any military pay allowances, such as combat, clothing, housing, or aviation.
The employee’s gross pay includes their wages for hours they would have worked and includes overtime if the employee was regularly scheduled for overtime hours. In addition, the employer is required to continue paying all benefits, including health care, retirement, and profit-sharing as if the employee had worked their regular schedule.
If an employee does not have a regular or predetermined work schedule at the time they are required to take military leave, the employer should determine the employee’s regular work schedule based upon the employee’s monthly, bi-weekly, semi-monthly or weekly pay periods immediately preceding the employee’s military leave as follows:
- Three monthly pay periods;
- Six bi-weekly or semi-monthly pay periods; or
- Twelve weekly pay periods.
In calculating supplemental pay, employers should not include periods in which an employee was on unpaid or partially paid leave prior to taking military leave.
The Implementation Guidance covers many other important topics. If you have questions regarding the guidance or the San Francisco Military Leave Pay Protection Act, contact a Jackson Lewis attorney to discuss.